South Boston: The Latest Trends Shaping the Housing Market

In case you missed it, the experts have taken a look at the data for the year and surmised that 2018 is looking to be a seller’s market again. That means that sellers this year are going to have an advantage in the field over aspiring homebuyers. 

While there are many factors at work in our local market, it appears the fact that not enough new (and affordable) homes are being built, a flood of first-time millennial homebuyers entering the market and a recovering economy has resulted in a housing inventory shortage across the city and nation. 

You might be wondering, with all the new luxury condos under construction in South Boston, if it’s going to be exempt from this trend. 

However, though Southie’s currently undergoing a remarkable amount of growth and change, it still appears to be following much of the same general real estate trends as the rest of the city. 

Here’s a breakdown of Southie’s real estate market as it compares to the city averages:

Sales

For Boston, pending sales were as stagnant as ever with an increase of .3%, ending the year at 5,958. South Boston, on the other hand, closed out at 782, a 3.5% increase which also makes up roughly 13% of the entire Boston proper market.

Closed sales were up a mere 18 properties citywide from last year, whereas in South Boston they increased by 27 units from last year.

Listings

Citywide, the number of homes for sale was 7,190 for 2017. That’s an increase of 5% from 2016. In South Boston, active listings capped out at 968 for 2017, having an increase of 8.5%. Something to note: the current listing inventory in South Boston for Q1 2018 was a whopping 64 average days on market compared to 32 days in Q1 2017. This is a direct result of new construction inventory hitting the market which will most certainly help to create an interesting and active year ahead.

Prices

It’s no surprise that home prices both in Southie, and the city as whole increased. The median Boston condo sales price increased by 3.8% to ~$840k for the year, whereas in Southie, they increased by 6% to ~$727k. 

So, what does all of this mean for you?

If you’re a homeowner, this is definitely a great time to sell your home if you want or need to take cash off the table (whether for peace of mind or an impending life event). This is especially true if your home is priced where the base of the pyramid of buyers are. Buyers are eagerly seeking out affordable real estate in this desirable and growing neighborhood, meaning your home could move quickly.

That being said, just because it’s a seller’s market doesn’t mean you can make the mistake of setting whatever price you want—in fact, your home’s initial list price could very well make or break the deal for you because buyers ultimately determine the market, and can sniff out unrealistic seller price expectations. Buyers are more intelligent than ever with their comparative home shopping skills, and will more likely test price points this year because mortgage rates are rising and home price increases have continued to outpace wage growth in our market. Also, the word is out that you can buy a new construction condo in South Boston any day of the week. With all that in mind, it’s a good idea to do what you can to stay competitive, even in a seller’s market.

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Request a free, no-obligation listing consultation with your local expert.

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If you’re looking to buy a home, on the other hand, don’t be discouraged! There are still plenty of opportunities for you to find a great home within your budget in Southie. Even with continued price increases, as you can see from the graph above, close to 67% of all home sales in the South Boston neighborhood in 2017 were under $800k. That being said, this is the time to stay vigilant, and act quickly, working with a local agent who has boots on the ground and knows the local terrain inside and out. Don’t be a tire kicker and procrastinate on making offers, going to showings, and making decisions, or you could end up seeing your ideal home swooped out from under you on multiple occasions. 

On the other hand, though, you don’t want to make any hasty decisions. The deal needs to make sense. As predicted, mortgage rates will be increasing in 2018, so you don’t want to get sucked into a bidding war and end up paying far more for the home than it’s true market value, just because you’re afraid to lose the home to another buyer and likely want to just settle on a place. Be open and communicative with your agent, who should be an expert in the neighborhood and be able to advise you to the best course of action during your home search.

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Have any questions? As an owner, is now a right time to sell and take tax free gains off the table? As a buyer, does Southie still make sense for you? For a free consultation or if you have further questions feel free to message me directly.

Schedule a meeting or chat with me here

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Chris Fitzpatrick is a licensed real estate broker in South Boston. Chris prides himself on his knowledge of South Boston nuances, off-market listings and new development projects that are rapidly shaping the neighborhood. He focuses on adding value in the form of creating proprietary real estate market data, predictive analytics, and technology helping sellers, buyers, and developers. Chris can talk your ear off about the benefits of yoga, loves to travel, is passionate about entrepreneurship, and loves rooting for the underdog.