Sky-high Prices and Limited Inventory Continue to Hold Back Prospective Buyers
Sales of both single-family homes and condominiums plummeted on a year-over-year basis in October as sky-high prices and limited inventory continue to hold back prospective buyers, but real estate market analysts did not sound overly alarmed Friday.
Homebuyers purchased 5,285 single-family homes in October, down 21.2 percent from October 2020 but a 1 percent increase over sales from the same month in 2019, The Warren Group said. Meanwhile, the median sale price increased to an October record of $500,000 last month, up 9.9 percent from October 2020’s median price and up 28.5 percent from October 2019’s median price of $400,000. The number of single-family home sales has declined for four consecutive months.
“At first glance a casual observer might think that a decline of 21.2 percent in single-family home sales in October was a cause for concern about the real estate market in Massachusetts,” Warren Group CEO Tim Warren said. “However, I would point out that the second half of 2020 was an extraordinary six months for home sales due to the disruption to the 2020 Spring market by COVID-19. October sales this year beat the number in October 2019, and every other October all the way back to 2004.”
He added, “Somehow, despite low inventory, high prices and rising interest rates, homes keep selling at pretty good clip, and prices continue their upward climb.”
Through 10 months of 2021, there were 51,150 single-family home sales in Massachusetts, a 3.4 percent increase over the first 10 months of 2020, and the year-to-date median single-family home price has increased 15.1 percent to $510,000.
The 2,089 condominium sales recorded in October represented a 15.8 percent decrease from October 2020 and a drop of 1.4 percent from October 2019, The Warren Group said. The median sale price of a condo increased 3.7 percent on a year-over-year basis to $425,000, also a new high for the month of October.
