Massachusetts Home Sales up Over 17 Percent in October as Buyers Took Advantage of Tax Credit

Homes put under agreement in October up for the fifth straight month

WALTHAM, MA – November 25, 2009 – (RealEstateRama) — The Massachusetts Association of REALTORS® (MAR) reported today that single-family home sales were up over 17 percent compared to October 2008 as buyers made sure to take advantage of the first-time homebuyer tax credit before it was set to expire.  Condominium sales also were up 17 percent.  Median prices were down 2.6 percent compared to last year, while condominium median prices were down 4.0 percent.  October pending sales (homes put under agreement) were up 27 percent from the same time last year.  This is the fifth straight month of increases.

“It is apparent from this significant jump in home sales in October, which is the biggest year-over-year gain we’ve seen since November 2004, that buyers were making sure to take advantage of the tax credit prior to its deadline,” said MAR President Gary Rogers, a broker with RE/MAX First Realty in Waltham.  “Now that the President has extended and expanded the credit, we should see continued improvement in the market through the winter and into the spring.”

There were 3,828 detached single-family homes sold this October, a 17.7 percent increase from the 3,252 homes sold the same time last year.  This is the largest single-month year-over-year gain since November 2004.  On a month-to-month basis, home sales were up 11.7 percent from 3,426 homes sold this past September.  This is not only the biggest September-to-October jump since MAR has been reporting monthly numbers, but also the first time sales have gone up from September-to-October since 2002.

The median selling price for single-family homes in October was $287,000, a decrease of 2.6 percent compared to $294,550 in October 2008.  The October median price was up 14 percent from the 2009 low of $252,500 in February. On a month-to-month basis, the October median selling price was down 1.0 percent from $290,000 in September 2009.

The October condominium market was up 17.2 percent compared to the same time last year (from 1,296 units sold in 2008 to 1,519 units sold in 2009).  Similar to single-family sales, the condo market had its biggest single-month year-over-year gain since September 2004.  On a month-to-month basis, condominium sales were up 4.0 percent compared to the 1,460 units sold this past September.  The condo market also had its largest September-to-October jump since MAR has been reporting monthly housing numbers.  It was also the first September-to-October increase since October 2002.

Condominium median selling prices in October were down 4.0 percent from $250,000 in 2008 to $240,000 in 2009.  The October median price was up $36,000 (18 percent) from the 2009 low of $204,000 January. On a month-to-month basis, the median selling price of a condominium was down 7.7 percent from a September median of $259,900.

Pending Sales:
The number of single-family homes put under agreement in October was up 27 percent compared to the same time last year (3,662 homes in 2008 to 4,652 homes in 2009).  On a month-to-month basis, single-family homes put under agreement were up 4.0 percent from 4,400 homes in September.  The number of condos put under agreement in October was up 33 percent compared to October 2008 (1,319 units in 2008 to 1,983 units in 2009).  On a month-to-month basis, condos put under agreement were down 15 percent from 1,770 units in September. Pending sales or sales “under agreement” are homes that have a signed purchase and sale agreement, but have yet to close and be recorded.

Inventory and Days on Market:
The inventory of residential properties on the market as of October 31, 2009 decreased 15 percent compared to the same time last year (from 45,118 listings in 2008 to 38,311 listings in 2009).  At the current sales pace, this represents approximately 7.2 months of supply, down from 9.9 months of supply in October 2008.  On a month-to-month basis, the average months of supply is down from 8.3 months in September.  It is considered a balanced market when there are between 7.5 and 8.5 months of supply.

The inventory of single-family homes also decreased 15.0 percent from October 2008 (31,912 listings in 2008 to 27,204 listings in 2009) which translates into 7.1 months of supply in October 2009.  This is down from 10.2 months of supply last year and down from 8.0 months in September.  October supply is at its lowest since October 2002.  The October peak was 40,254 homes in 2006.  This is the 19th straight month that inventory has gone down compared to the year before.
The condominium market saw October inventory decrease by 16 percent from last year (13,206 listings in 2008 to 11,107 listings in 2009), which translates into 7.3 months of supply, which is down from 10.2 months in October 2008 and down from 8.0 months this past September.  This is the 19th straight month that inventory has gone down compared to the year before.

“Another way the expansion of the tax credit can help stabilize the market here in Massachusetts is to help encourage current homebuyers who have wanted to buy a new home, but have been ‘waiting it out’ to put their homes on the market,” said Rogers.

Detached single-family homes stayed on the market an average of 126 days in October 2009 compared to an average of 140 days in October 2008, while condos stayed on the market an average of 137 days, down from an average of 141 days in October 2008.  On a month-to-month basis, days on market for single-family homes were up from 124 days and condos were up from 136 days in September.

About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 20,000 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