Blame it on the snow! February was a brutal month for Boston’s housing inventory
Creative Commons 2.0: Bill Morrow, http://commons.wikimedia.org/wiki/File:2015_February15_snow_in_Massachusetts_USA_16540721342.jpg
The great inventory death spiral continued in Boston’s housing market in February, with inventory in both the single-family and condo markets boasting double-digit declines, according to new analysis from the Greater Boston Association of Realtors (GBAR).
For the single-family marketplace, housing inventory dropped 29.3 percent and new listings by 38.7 percent, with just 1,992 homes for sale at the end of the month; for condos, things were even worse, with inventory falling 32.9 percent (and new listings by 33.7 percent) to just 1,057 active listings.
Inventory – Affordability’s Worst Friend
Unsurprisingly, such low inventory numbers only pushed Boston’s median price higher, and by extension, housing affordability even lower. Here’s how it broke down:
•In the single-family market, median price rose 7.9 percent to $439,500, while the housing affordability index fell 1.4 percent to 104; that’s down from 106 in Feb. 2014 and 129 in Feb. 2013 (good for a 19.4 percent decline).
•Meanwhile, in the condo market, median price rose 3.5 percent to $403,568, and the affordability index, interestingly, rose 2.8 percent to 114; that said, the index is still down from 140 in Feb. 2013, an 18.6 percent decline.
The Wintry Freeze
Of course, some of those inventory declines can be attributed to the borderline-biblical wintry weather that Boston endured, and GBAR’s comments emphasized that fact, albeit in a very tongue in cheek manner.
“When weather patterns turn bad, like wicked bad, real estate industry pundits tend to go gloom, assuming that Americans hungry for homeownership are bothered by a little frozen precipitation,” the report stated. “The nation will unfreeze, inventory is expected to rise and home sales are widely expected to increase. These are good times, indeed, and many of us now have an enchanting shared experience that we can walk uphill to school both ways.”
There was one positive dimension to GBAR’s report, although even that came with a caveat – single-family home sales rose 5 percent, and are up 2.6 percent year-to-date. The caveat? Pending sales were down 7.5 percent from January, and for condos, pending sales were down 19.8 percent.