The Lamacchia Housing Report presents overall home sale statistics and highlights the average sale prices for single families, condominiums, and multi-family homes in Massachusetts and New Hampshire for September 2020 compared to September 2019. It also looks at other metrics in Massachusetts like Homes Listed for Sale, Homes Pending, and Price Adjustments made to active listings, as they are often the best indicators for predicting future trends in the market.
This month’s report will be unlike years’ past due to the lingering effects of COVID and the massive amount of home sellers that didn’t list their homes in late March and early April when the lockdown first hit.
Massachusetts Home Sales Up 25.3%
Massachusetts sales are up by 1,943 sales, 25.3% over September 2019. Sales increased by 27% in single families, 26% in condos and by 9.5% in multi-families. The significant increase in sales in September is a result of the delayed spring market- buyers and sellers are still playing catch up when by now, September tends to be a little calmer. Not this year, thanks to COVID.
Prices have increased again by 9.9%, $46,403 overall in Massachusetts compared to this time last year. All three categories increased in prices. When demand is high and supply is low, sale prices increase naturally with buyers outbidding one another
Homes Listed for Sale:
This is the third month this year that the number of homes listed exhibited an increase which is a positive sign for buyers. There were an additional 281 homes listed in September 2020 over September 2019- a 2.6% increase. This imbalanced market is slightly tipping towards the buyers’ favor and will hopefully be a less competitive environment for buyers than it has been all year so those who want to get deals done before the holidays can.
Pending Home Sales:
Pending home sales are up by 15.7% over September 2019 which continues to prove that this market is hot. The historically low mortgage rates have helped give more buying power in multiple offer situations and have provided an incentive for frustrated buyers to stay out there as it’s almost unheard of to see 30-year loans at 3% for so long.
As you can see in the chart below, the number of homes that have gone pending this year over last year is higher in the past few months than it has ever been.
Price Changes:
Price changes (reductions) decreased by 20.5% over September 2019 which shows that buyers are willing to pay what sellers want- particularly if the house is priced well. This is typically the season for price adjustments – buyers markets have more selection and sellers need to be the ones who are competitive. COVID has flipped the script and the need for price adjustments isn’t as prevalent, but if you are a seller and are not getting almost immediate offers or at least interest, it’s likely that your price point is higher than it should be.
New Hampshire Home Sales Down 7.2%
New Hampshire exhibited a decrease in sales and an increase in prices when compared to September 2019. Sales saw a 7.2% decrease with 101 fewer sales. There was a decrease in sales in single and multi-families and a slight 1% increase in condos. Prices increased by 18.4% in all three categories to $374,834.
What’s Ahead?
That post-Labor Day spike in the number of homes listed we hoped we’d see thankfully happened which took some of the edge off for buyers. Sellers realize how good the market is and buyers who haven’t lost hope are motivated to seal the deal.
The Fall market tends to be when the imbalance shifts into the buyer’s favor, with less competition and more selection but this year hasn’t alleviated the pressure as much as normal. Safety guidelines and historically low mortgage rates have helped perpetuate buyer activity despite the historically low supply of homes.
Most sellers want to sell for the most money but they need to stay grounded when pricing their homes. Pricing should be based on actual comps and not what they heard their neighbor sold for. If sellers are trying to receive offers that are high, pricing high won’t get you there. Price appropriately and buyers will compete and that’s when the over-asking offers start to roll in. Two things to remember though: first, the highest offer isn’t always the best one- it could be flimsy or riddled with contingencies- and second, if a home has been on the market for a few weeks without much interest, it’s likely that a price adjustment may need to be considered.
The market is trying to catch up to where it would be had COVID not put a massive wrench in the works, but it’s not quite there yet.
Data provided by Warren Group & MLS PIN and compared to the prior year.