Updated: May 7, 2020
Anyone who pays even the slightest attention to the real estate market in and around the Boston area knows that it’s a seller’s market out there. It’s been that way for many years. We’ve written blog after blog for buyers, detailing the big and small ways they can make their offers more appealing to sellers. We’ve also helped dozens of sellers sort through multiple bids to choose the best offer. However, we have recently observed a number of signs and signals that indicate a coming shift in the real estate market; here’s what we’ve seen and what it means to buyers.
California is a trend-setter (I’m not talking about Hollywood fashion).
Change has to start somewhere, and our Compass colleagues in the Golden State are reporting a shift towards a more balanced market, probably due to the incredibly high prices (the median price in CA this year is $536,250, a 7.3% increase compared to this time last year). Inflated prices result in fewer offers per property, and homes sitting on the market longer before the sale. Case in point: There’s been a drop of 11.8% in sales of both new and existing houses and condominiums in California since 2017. This in turn leads to home prices dropping and inventory increasing. It takes time for these shifts to come our way, but we anticipate similar trends making their way to the east coast in the next 12–16 months.
Our neighboring colleagues see the shift, too.
I recently took an accreditation class and there were a lot of local realtors (outside the Boston area) talking about this shift away from the intense seller’s market we’ve been experiencing. Many suburbs are seeing price drops as well as slight increases in days on the market. We have not yet experienced this shift within the Boston area, but the market is definitely changing.
We’ve seen this before.
Because Liz and I have been in the business for years and worked through the last selling boom and bust, we know what a hot market looks like when it’s starting to cool. Read this New York Times article for a clear rundown on what might be coming our way.
What does this mean for you? A chance at some stability.
This anticipated shift towards a buyer’s market gives potential home buyers a chance to jump into the real estate market with better success. “More-balanced market” buyers have more options: We can actually imagine a time when buyers will not have to waive every contingency, sell their existing home to raise enough cash, and make an offer 20% over asking price. It will be a time when buyers will be able to see the property for more than 20 minutes at an open house before making an offer.
No matter what kind of market we're in, we have the know-how and experience to help our buyers, so please reach out if we can help you understand the pros and cons of this particular market.
A note for sellers: When you price your home right and stage it appropriately for buyers, we will always be able to sell your home.