Boston Real Estate Market 2018
The housing market in Metro Boston is back on track and looking healthy for 2018. A number of factors are driving this recent growth. The prediction is that prices will rise in 2018 as they will in most of the US housing market.
The reason for the unusual late season surge is due to a big pent up demand from homebuyers and plenty of foreign real estate investors. Low mortgage rates, a strong economy, and the inventory of homes for sale is bolstering sales.
The 1,101 single-family detached homes sold in October 2017 was the fourth highest sales total on record for the month and was a 14.3 percent increase on the 963 homes sold in October 2016 – GBAR report.
Home prices in Boston in October according to GBAR rose 8.2% and condos rose 6.6%. According to Zillow, home prices are forecasted to climb another 5% in 2018.
Home prices grew 3.1% over the last 12 months in Metro Boston and 7% in the city of Boston itself. NAR reports the average home price was $633,000. Zillow has the average detached house price at $544,000.
As the graphic below shows, prices have been rising fast since 2013. The trend looks the same for the next 12 months based on housing constraints, demographics, and a positive economic forecast.
This chart below courtesy of Realtor.com shows home price growth in Boston’s largest communities.
|Town||Avg Home Prices||Average Home Price 2014||Forecast Price end of 2108|
Take a good look at this heatmap of rental prices, and it might give you a good idea of home prices as well. The further you go from Downtown Boston, the more likely you are to find affordable homes. Be forwarned of Boston’s congested, time consuming commutes to which I can attest are as bad as any.
Boston Home Prices Not all That Severe Compared to California
Too many reports have it that Boston’s real estate is extremely unaffordable, but take a look at prices in Los Angeles, Washington DC, and New York. Compared to the Bay Area and LA Home prices, Boston’s real estate looks very good, even for buyers.
See what’s happening in southen US cities: Miami Real Estate forecast , San Diego Housing forecast, and the Houston Real Estate forecast for 2018. And compare to the super hot city of Seattle Wa. Who is going to win SB52? SuperBowl 2018 Predictions.
Investors might want to review properties outside of Boston city such as Easton, Lawrence, Worcester, Lynn, Salem, Stoughton, Framingham, Brockton, and Dedham. They’re nice communities and there’s plenty of property to build on.
However, it looks as though home prices are about to rise in Boston. So the questions: “should I buy a house?” or “should I sell my house” in Boston aren’t easy to answer. To help with a sell decision, see the post on selling tips and on best renovation for ROI.
What Supports the Boston area Economy?
Boston has a strong regional economy bolstered by transportation, tourism, financial services, and increasingly venture capital. Boston is becoming the Silicon Valley of the north with major influx of funding for startups in FinTech, MedTech and EduTech. Ultimately, all decisions to buy a home in Boston relate back to the US economy, US housing market, and the Massachusetts economy.
Boston’s Powerful Economic Engine
Boston’s economy is a power house yet restrictions on immigration will retard its output. Retiring babyboomers (although many are continuing to work) and a full employment situation mean growth will be constrained by a lack of workers, including skilled workers from other countries.
It’s good news for workers in other cities and states who need jobs. If you can find somewhere to live in Boston, you should have little trouble finding a great job.
Employment and Wages in Massachusetts Will Rise in 2018
Good news for workers is that wages are expected to grow 4% which will result in higher home prices. The unemployment rate will fall to 3.7%. Higher costs for wood will push home prices up further. A good strategy might be to buy soon because all factors point upward.
The real estate market et al, is expected to grow 2.2%. All of this will heat up the Boston market making housing more unaffordable. And just like California, workers will be willing to relocate further from the city to buy what they can afford. And Millennials do want to buy homes or condos with their growing wages.
Finding a Home In Boston’s Many Neighborhoods
If you’re thinking of a move to Boston, you’ll want to scout out the most affordable neighborhood for you and your family. Prices vary a great deal. NAR reports these recent prices:
|Area||Units For Sale||Units For Rent||Median
|Back Bay East||85||148||$1,550,000|
|Back Bay West||52||118||$1,399,000|
With the Boston housing market looking so good for 2018, and with employment/and economic strength so positive, it might be a no brainer to move to Massachusetts in 2018.
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