While it comes as no surprise to learn that housing prices in downtown Boston are costlier than in those areas that lay outside of the downtown area, two recent reports have found that the gap may be bigger than once believed. At the same time, as prices are growing higher and higher in Boston, the number of sales are on the decline. This is not due to a lack of interest, however, as the city is simply continuing to experience a very tight market with too homes available in its inventory to meet demand.
Examining Sale Prices
According to the first report, which was published by real estate research site PropertyShark, the median sale price in downtown Boston was $369,000 higher than the overall median for the city. This is despite the overall median increase that occurred after the 2008 financial crisis, which gave it a bump from $335,000 to $590,000. During this same time period, median prices in the downtown area jumped from $637,500 to $959,000. For the purposes of this particular report, downtown was defined as the Financial District, Downtown Crossing and some of the surrounding blocks.
Appraiser Miller Samuel and brokerage Douglass Elliman also created a report focusing on the fourth quarter of 2018. The researchers found that condo and townhouse prices were generally up in downtown Boston neigbhorhoods, with the median condo sale price being up to $838,500. According to Zillow, on the other hand, the city’s median price was $617,900 in November 2019.
At the same time as prices continue to increase in Boston, November data shows that home sales took a bit of a dip that same month. According to the Massachusetts Association of Realtors, sales of single-family homes were down by 0.9 percent in November when compared to that same month the previous year. On the other hand, the median cost of a single-family home went up by 4.1 percent to $395,000.
Condos had even more troubles than single-family homes, with the Massachusetts Association of Realtors finding that sales dropped by 11.7 percent in November when compared to the same month in 2018. Nonetheless, prices increased by 1.4 percent during this same time period to $375,000.
Overall, the number of closed deals for both condos and single-family homes have been down or flat for most of 2018. In addition, the median prices have been up or flat for an even longer period of time. This translates into a tight market for potential buyers with annual declines in inventory in November for both single-family homes and condos.
Given the current market conditions, those who are interested in purchasing a home in Boston are not likely to have an easy time finding something that is available. Furthermore, those who are serious about buying have little room to be picky. Unfortunately for those who want to call Boston their home, this trend is not likely to reverse itself any time soon. In fact, it is likely to only grow worse until the city manages to make more housing options available.