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Price Decreases?
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PostPosted: Thu Jul 26, 2018 5:23 pm GMT    Post subject: Price Decreases? Reply with quote

Hey everyone - I've been noticing in my redfin emails that there was some price drops on listings. I have to say that's the first time I've seen that in a while in the Boston area. Has anyone else been noticing? Do we think it's just sellers who think they can list their homes for anything rather than a true sign we're reaching the top of what people will pay vs mortgage rates going up?
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PostPosted: Thu Jul 26, 2018 6:28 pm GMT    Post subject: Re: Price Decreases? Reply with quote

guest wrote:
Hey everyone - I've been noticing in my redfin emails that there was some price drops on listings. I have to say that's the first time I've seen that in a while in the Boston area. Has anyone else been noticing? Do we think it's just sellers who think they can list their homes for anything rather than a true sign we're reaching the top of what people will pay vs mortgage rates going up?


If these homes were priced in line with similar recent comps, and they
had do drop the prices, then that's a good sign that values are softening.
You'd have to know the recent comps to be sure.
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bsg61
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PostPosted: Thu Jul 26, 2018 8:18 pm GMT    Post subject: Reply with quote

Yes, I've been noticing price drops as well. Prices are rather astronomical to begin with so it doesn't come as a surprise. It seems that the frequency of new listings being sent to my inbox is increasing as well - noticeably in the last two weeks - so maybe sellers are thinking that this is their chance before things start to turn.

I have heard that Boston is different from other places, all real estate is local and you can't believe everything you read, but saw this article recently:

https://www.cnbc.com/2018/07/24/southern-california-home-sales-crash-a-warning-sign-to-the-nation.html
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PostPosted: Thu Jul 26, 2018 8:22 pm GMT    Post subject: Reply with quote

I think the current situation is there is no affordable housing, but there are so many out of reach homes available. Most of the price drop might be happening to properties that is priced above 900K. For condo below 400k, or SFH below 600K, I don't see too much price drop, even though it is completely piece of junk.

The Sick fact in Boston area is, beside a few slum areas, 500K is the entry level for SFH. But once you hit over the million mark, what you are getting contains way better value than those $800k or below crab shack. From the million dollar mark north, every 10k increase in price, will get you almost into a whole new level of luxury. The problem is not many people can come up with down payment, and handle the monthly payment for 1 million plus home yet in Boston.
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PostPosted: Thu Jul 26, 2018 8:57 pm GMT    Post subject: Reply with quote

Anonymous wrote:
I think the current situation is there is no affordable housing, but there are so many out of reach homes available. Most of the price drop might be happening to properties that is priced above 900K. For condo below 400k, or SFH below 600K, I don't see too much price drop, even though it is completely piece of junk.

The Sick fact in Boston area is, beside a few slum areas, 500K is the entry level for SFH. But once you hit over the million mark, what you are getting contains way better value than those $800k or below crab shack. From the million dollar mark north, every 10k increase in price, will get you almost into a whole new level of luxury. The problem is not many people can come up with down payment, and handle the monthly payment for 1 million plus home yet in Boston.


So actually I have been seeing the drops in the lower end of the market, those are the Redfin emails I get bc that’s my price range. Couple Watertown and newton condos around 400-500 dropping. I have seen any price drops at all really in this market for a few years so that’s why it stuck out to me and thought I’d mention it here!

Also agree with the other poster that I’m getting a lot more new listing in my email as well. I’m just interested in what might be coming down the pipeline soon for this market.

Also saw this article on reddit too: http://www.crainsnewyork.com/article/20180726/REAL_ESTATE/180729924/housing-market-may-be-headed-for-its-worst-slowdown-in-years
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PostPosted: Thu Jul 26, 2018 9:46 pm GMT    Post subject: Reply with quote

Quote:
Couple Watertown and newton condos around 400-500 dropping


What are the size and condition for those watertown/newton area mid 400k condo you mentioned?

I know there were tone of developments in watertown/newton line for luxury condo on pleasant street, so inventory there is abundant. If a studio or 1 bed there asking for mid 400k, then it is over priced and I am not surprised price should go lower, as interest rate is on a rise.

tinny price drop could due to a balance act of seller based on current interest rate. I won't get the false hope up, unless the drop is more than 5%.

Provide same redfin samples of price drop so we all can analyzed if this is the beginning of a big down trend in price.
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PostPosted: Thu Jul 26, 2018 10:10 pm GMT    Post subject: Reply with quote

Anonymous wrote:
Quote:
Couple Watertown and newton condos around 400-500 dropping


What are the size and condition for those watertown/newton area mid 400k condo you mentioned?

I know there were tone of developments in watertown/newton line for luxury condo on pleasant street, so inventory there is abundant. If a studio or 1 bed there asking for mid 400k, then it is over priced and I am not surprised price should go lower, as interest rate is on a rise.

tinny price drop could due to a balance act of seller based on current interest rate. I won't get the false hope up, unless the drop is more than 5%.

Provide same redfin samples of price drop so we all can analyzed if this is the beginning of a big down trend in price.


Sure, let’s check out if this is real or just due to the issues you’re stating above...some of these do seem like they were overpriced to begin with, but I feel like in the past few years anything was selling and it didn’t seem to matter, I don’t remember seeing prices drop at all, ever.

It’s also depressing seeing listings that sold for 100-200k less 3-4 years ago in the 300-400k range now...

25k drop: https://www.redfin.com/MA/Watertown/11-Wollitzer-Ln-02472/unit-11/home/146046023?

10k drop: https://www.redfin.com/MA/Watertown/32-Whites-Ave-02472/unit-23D/home/146176623?

20ish k drop: https://www.redfin.com/MA/Newton/2-Colonial-Ave-02460/unit-1/home/142391289?

10k drop: https://www.redfin.com/MA/Newtonville/935-Washington-St-02460/unit-12/home/11417857?

20k drop: https://www.redfin.com/MA/Waltham/74-School-St-02452/unit-F1/home/146081989?

30k drop: https://www.redfin.com/MA/Waltham/114-Thornton-Rd-02453/home/11816127?

10k drop: https://www.redfin.com/MA/Waltham/34-Ravenswood-Rd-02453/home/11810885?

50k drop: https://www.redfin.com/MA/Waltham/24-Lakeview-Ter-02451/home/11801861?

Recent 25k drop: https://www.redfin.com/MA/Waltham/651-Trapelo-Rd-02452/home/11803957?

30k drop: https://www.redfin.com/MA/Cambridge/71-Oxford-Ave-02138/unit-4/home/11604017?

20k drop: https://www.redfin.com/MA/Stoneham/146-Marble-St-02180/unit-202/home/11667076?

12k drop: https://www.redfin.com/MA/Stoneham/6-Hersam-St-02180/home/11663378?
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PostPosted: Fri Jul 27, 2018 1:27 am GMT    Post subject: Reply with quote

I went through your list quickly. the 2 newton and 1 Cambridge homes' price drop is so small, totally feel like just compensating interest rate hike. There are couple of waltham and 1 water home price drop close to or more than 5%, hopefully that indicates a crack to current housing unaffordability. Need to review those cases individually to see why the bigger price drop.

Over all, I feel like it is more a indication of price being flat currently. Looking forward to the winter of 2018, see if price down trend will have bigger acceleration.
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PostPosted: Fri Jul 27, 2018 5:20 am GMT    Post subject: Reply with quote

Anonymous wrote:
I went through your list quickly. the 2 newton and 1 Cambridge homes' price drop is so small, totally feel like just compensating interest rate hike. There are couple of waltham and 1 water home price drop close to or more than 5%, hopefully that indicates a crack to current housing unaffordability. Need to review those cases individually to see why the bigger price drop.

Over all, I feel like it is more a indication of price being flat currently. Looking forward to the winter of 2018, see if price down trend will have bigger acceleration.


Ya makes sense, I do think it’s at least encouraging to see the drops knowing people are so desperate that they’ll just pay whatever, which I feel like was the trend the last few years. Only time will tell I guess, I do hope we see it stay flat with more inventory available at the least.
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PostPosted: Fri Jul 27, 2018 12:16 pm GMT    Post subject: Reply with quote

Quote:
Ya makes sense, I do think it’s at least encouraging to see the drops knowing people are so desperate that they’ll just pay whatever, which I feel like was the trend the last few years. Only time will tell I guess, I do hope we see it stay flat with more inventory available at the least.


With 30 year fixed mortgage rate around 3.5% couple years ago, and the job market start to doing well, that was all it took to eliminate most of lower bracket of affordability in Boston market. That is why you saw 100k to 200k increase of price of same property within the past few years as you previously stated.

flashback to today, interest rate around 4.5%, uncertainty of trade war, and with more new developments of housing coming to the market, so price is flat.The Greed is still here in Boston housing market. I think short term the stock market will dictate the direction of the housing market next. As long as the stock market stay above 24000 line, don't expect any substantial price drop on Boston housing. For the mid term, if mortgage rate go beyond 5%, It will dip more. For the long term, we need to see if all the new jobs being created locally can consume all the new housing developments that is coming to Boston market. If you see rent start dropping due to rental demand disappear, then it is truly the sign of Boston housing market going downhill.
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PostPosted: Sat Jul 28, 2018 12:02 am GMT    Post subject: Reply with quote

Anonymous wrote:
Quote:
Ya makes sense, I do think it’s at least encouraging to see the drops knowing people are so desperate that they’ll just pay whatever, which I feel like was the trend the last few years. Only time will tell I guess, I do hope we see it stay flat with more inventory available at the least.


With 30 year fixed mortgage rate around 3.5% couple years ago, and the job market start to doing well, that was all it took to eliminate most of lower bracket of affordability in Boston market. That is why you saw 100k to 200k increase of price of same property within the past few years as you previously stated.

flashback to today, interest rate around 4.5%, uncertainty of trade war, and with more new developments of housing coming to the market, so price is flat.The Greed is still here in Boston housing market. I think short term the stock market will dictate the direction of the housing market next. As long as the stock market stay above 24000 line, don't expect any substantial price drop on Boston housing. For the mid term, if mortgage rate go beyond 5%, It will dip more. For the long term, we need to see if all the new jobs being created locally can consume all the new housing developments that is coming to Boston market. If you see rent start dropping due to rental demand disappear, then it is truly the sign of Boston housing market going downhill.


This happens every year. Prices peak in the spring and bottom out in the winter. If prices don't go up next spring, then we can say we have reached the peak. What's really happening is that some sellers are pricing above market prices and have to drop if they truly want to sell. Anything priced right is gone within a week. The slower YOY appreciation does mean that we are within a few years of the top. Most economists predict 2020 to be the top.
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PostPosted: Sat Jul 28, 2018 12:48 pm GMT    Post subject: Reply with quote

Guest wrote:
Anonymous wrote:
Quote:
Couple Watertown and newton condos around 400-500 dropping


What are the size and condition for those watertown/newton area mid 400k condo you mentioned?

I know there were tone of developments in watertown/newton line for luxury condo on pleasant street, so inventory there is abundant. If a studio or 1 bed there asking for mid 400k, then it is over priced and I am not surprised price should go lower, as interest rate is on a rise.

tinny price drop could due to a balance act of seller based on current interest rate. I won't get the false hope up, unless the drop is more than 5%.

Provide same redfin samples of price drop so we all can analyzed if this is the beginning of a big down trend in price.


Sure, let’s check out if this is real or just due to the issues you’re stating above...some of these do seem like they were overpriced to begin with, but I feel like in the past few years anything was selling and it didn’t seem to matter, I don’t remember seeing prices drop at all, ever.

It’s also depressing seeing listings that sold for 100-200k less 3-4 years ago in the 300-400k range now...

25k drop: https://www.redfin.com/MA/Watertown/11-Wollitzer-Ln-02472/unit-11/home/146046023?

10k drop: https://www.redfin.com/MA/Watertown/32-Whites-Ave-02472/unit-23D/home/146176623?

20ish k drop: https://www.redfin.com/MA/Newton/2-Colonial-Ave-02460/unit-1/home/142391289?

10k drop: https://www.redfin.com/MA/Newtonville/935-Washington-St-02460/unit-12/home/11417857?

20k drop: https://www.redfin.com/MA/Waltham/74-School-St-02452/unit-F1/home/146081989?

30k drop: https://www.redfin.com/MA/Waltham/114-Thornton-Rd-02453/home/11816127?

10k drop: https://www.redfin.com/MA/Waltham/34-Ravenswood-Rd-02453/home/11810885?

50k drop: https://www.redfin.com/MA/Waltham/24-Lakeview-Ter-02451/home/11801861?

Recent 25k drop: https://www.redfin.com/MA/Waltham/651-Trapelo-Rd-02452/home/11803957?

30k drop: https://www.redfin.com/MA/Cambridge/71-Oxford-Ave-02138/unit-4/home/11604017?

20k drop: https://www.redfin.com/MA/Stoneham/146-Marble-St-02180/unit-202/home/11667076?

12k drop: https://www.redfin.com/MA/Stoneham/6-Hersam-St-02180/home/11663378?


It's still depressing to see that 500k only gets you a tiny condo/townhouse, starter home or a house on a busy street. Most people are looking for a 2k sqft house with a yard, yet developers are only building luxury condos and million dollar houses. The trickle down effect doesn't work when it comes to housing either.
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PostPosted: Sun Jul 29, 2018 2:03 pm GMT    Post subject: Reply with quote

Quote:
It's still depressing to see that 500k only gets you a tiny condo/townhouse, starter home or a house on a busy street. Most people are looking for a 2k sqft house with a yard, yet developers are only building luxury condos and million dollar houses. The trickle down effect doesn't work when it comes to housing either.


land and building expense are very expensive in Boston area. To maximize on per SQ footage on profit, Luxury condos and million dollar house are the way to go.

For starter, a 2 bedroom condo is what you should consider. 2k SQ house with a yard is not for first time home buyer, and it is not a starter home, at today's price standard in Boston area. Please expect to pay 800k or more for something similar in safe areas with decent house condition.

If you search SFH less than 400k within 95 belt, you got some inventories in Revere, Randolph, Weymouth and flood zone like Hull, and you got single number in metro west.
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PostPosted: Sun Jul 29, 2018 2:07 pm GMT    Post subject: Reply with quote

In metro Boston, I guess the trend is generally (in boom or bust times)
starter home = 2BR condo
move up home = 1,600 -1,800 sqft single family with small yard
forever home = 2,400 sqft with 8,000 - 10,000 yard
+renovations = add another 300 sqft addition or renovate basement or attic to bring the total to around 3,000 sqft

If you want a 'new build' home, non millionaires are forced into the outer suburbs
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PostPosted: Mon Jul 30, 2018 1:32 am GMT    Post subject: Reply with quote

Anonymous wrote:
Quote:
It's still depressing to see that 500k only gets you a tiny condo/townhouse, starter home or a house on a busy street. Most people are looking for a 2k sqft house with a yard, yet developers are only building luxury condos and million dollar houses. The trickle down effect doesn't work when it comes to housing either.


land and building expense are very expensive in Boston area. To maximize on per SQ footage on profit, Luxury condos and million dollar house are the way to go.

For starter, a 2 bedroom condo is what you should consider. 2k SQ house with a yard is not for first time home buyer, and it is not a starter home, at today's price standard in Boston area. Please expect to pay 800k or more for something similar in safe areas with decent house condition.

If you search SFH less than 400k within 95 belt, you got some inventories in Revere, Randolph, Weymouth and flood zone like Hull, and you got single number in metro west.


A 800k house with 20% down means a mortgage of around 4100/month. That's a lot of money.
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