Mild Weather, Low Mortgage Rates and Moderating Home Prices Lead to Record Number of Pending Sales for a February

Mild Weather, Low Mortgage Rates and Moderating Home Prices Lead to Record Number of Pending Sales for a February

Email still most popular form of communication between Realtors and their clients

WALTHAM, Mass. – March 11, 2016 – (RealEstateRama) — The Massachusetts Association of Realtors® (MAR) reported today that homebuyers took advantage of mild winter weather, moderating home prices and mortgages rates hitting a 12-month low (3.695%*) to push pending home sales up to their highest level in the month of February since MAR began recording this data in 2004. Unsurprisingly, Realtors® confidence in the market was positive again in February.

This month’s “Hot Topic” question finds that the majority of Realtors® still use email as their primary communication with their clients, over text, phone and social options.

February Pending Sales:

Single Family February 2016 February 2015 % Change
Sales 4,531 2,578 75.8%
Median Price $308,750 $316,000 -2.3%
  • Pending sales have been up 35 of last 36 months
  • Most pending sales in the month of February since 2004
  • First time median price has gone down in 12 months
Condominium February 2016 February 2015 % Change
Sales 1,809 1,118 61.8%
Median Price $285,000 $293,250 -2.8%
  • Pending sales have been up 35 of the last 36 months

“What a difference a year makes in pending sales when you don’t have to contend with the snowiest February on record,” said 2016 MAR President Annie Blatz, branch executive at Kinlin Grover Real Estate on Cape Cod. “When you have ongoing strong demand combining with mild weather, very low interest rates and moderating home prices, it’s not surprising why February was so strong for pending sales.”

REALTOR® Market and Price Confidence Indexes:

Confidence Index February 2016 February 2015 %Change
Market 68.66 54.48 26%
Price 75.70 76.35 -1%
  • The Realtor® Market Confidence Index was up for the 11th straight month
  • The Realtor® Price Confidence Index was down for the first time in six months
  • Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition

“Home prices have been steadily increasing over the past few years, and the Realtor® Price Confidence Index has stayed very positive because of it,” said Blatz. “While confidence in the overall market is on the plus side of the scale, a lack of homes for sale is what is generally keeping the number in its current range.”

Monthly ‘Hot Topic’ Question:

The February “Hot Topic” question asked Realtors® what was the most common communications method they used with their clients over the past six months. Of those Realtors® who responded, over 51 percent reported that they primarily used email. Forty-seven percent of Realtors® responded that they either use text messaging (36%), or the phone (11%). Less than two percent of the respondents said that relied on in-person meetings or Facebook messenger. No respondents used Twitter direct message.

“Connectivity is must in a world where Realtors® rely on email to communicate with current and potential clients,” said Blatz.

About the Data Sets:

The tracking of signed purchase and sales agreements (also called “pending sales”) provide reliable information about where the real estate market is heading in coming months.

A pending sale or a sale “under agreement” happens when the buyer and seller agree on the terms of the sale of a home and have a signed purchase and sale agreement, but have yet to close and be recorded as such.  MAR is the only organization, which compiles this statewide information from Multiple Listing Services each month.

Monthly pending (or under agreement) data and closed sales data comes from the three Realtor®-affiliated Multiple Listing Services in Massachusetts. They are the Berkshire County Multiple Listing Service, Cape Cod & Islands Association of Realtors® Multiple Listing Service, Inc.; and MLS Property Information Network, Inc. The data is compiled by ShowingTime 10K and updated each month. As a result, previous data may change after the reports have been run.

The REALTOR® Index Methodology – The Massachusetts Realtor® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of Realtors® members on the state of the housing market.  More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.

  • How would you describe the current housing market?
  • What are your expectations of home prices over the next year?

In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.

The RMCI is calculated in the following way.  Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points).  The results are the average score for each question.  A score of 50 is the threshold between a “strong” and a “weak” condition.  Similarly, the question about home prices over the next year (Realtor® Price Confidence Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).

About the Massachusetts Association of REALTORS®:

Organized in 1924, the Massachusetts Association of Realtors® is a professional trade organization with more than 22,000+ members.  The term Realtor® is registered as the exclusive designation of members of the National Association of Realtors® who subscribe to a strict code of ethics and enjoy continuing education programs.

* Mortgage rate information based on HSH.com analysis.

Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.

by Eric Berman – eberman (at) marealtor (dot) com – 781-839-5507

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