Housing slump not over - BostonHerald.com
When I read through the above article, it is clear everyone that the Massachusetts housing market is not the pot of gold that everyone experienced in '04 and '05. What the Herald buried down three quarters of a page was the following quote:
Massachusetts’ housing market isn’t in as rough a shape.
Regular readers of this blog recognize by now that the median numbers, when analyzed a number of different ways show a different picture. Are things down since '05? Of course they are, and they needed to come down. The '05 market was the height of unsustainable growth. That winter we heard "Bubble" and the spring of '06 heard talks of interest rates "sky-rocketing" up to well over 7% Well, last year the market did "correct" and the rates temporarily approached 7%, but what happened next surprised everyone. The rates took a turn down in November '06 and at one point I was able to refinance my 6.625% 30 year interest only loan into a 6.0% 30 year PITI (conventional principal, interest, taxes and insurance) loan for the same monthly payment. In a period of 6 months I completely upgraded my long-term financial flexibility.
All of a sudden the talk of a "bubble" went away and the market absolutely took off this past spring ('07). By April all indications within Brookline and other immediate Boston suburbs, pointed to this being one of the strongest real estate markets ever. Then the media got wind of the unfortunate conditions in Florida, California and other areas of the country with less housing demand. The firestorm started with the "credit crunch" and all of a sudden foreclosures were at "record levels." For those keeping track of these things, there were no more than 3 foreclosures in any month within the town of Brookline, and there were even a few months with zero.
What the media was failing to notice was '06 was much harder on home sellers than '07 had been. Now we're facing a problem where the market could possibly grind to a halt and nobody in the media would be able to guess why. Time after time, conversation after conversation it is becoming apparent that there is no quality housing stock coming onto the market. Buyers are out there right now needing to buy. People are trying to find housing, and their options right now are completely limited by the fear that the media has instilled in all potential sellers. Rental prices are going through the roof right now, showing us that people still have significant money to spend on their housing. Almost every buyer I speak with, and across the board most agents I talk to all say they are out there actively looking and there is nothing good to look at.
The numbers (which you can find in the archive here) are strong for Brookline. Home sellers who pay attention to the market are selling their property quickly and for good prices. Buyers are out looking (I know one open house that had almost 40 people the first weekend). If you are thinking about selling, put your property on now where you will face almost no competition. When the spring comes around the market should be crowded again and we'll finally get to see how this shakes out.
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