Sales up 10% and Prices up 4%
2016 was another year full of growth for the Massachusetts housing market! Even bigger than 2015 which made 2016 the biggest year for overall home sales since 2005! We had predicted that this would happen in 2016 back in our 2015 Housing Report and Anthony explained it on an Urban Update with Channel 7 back in March.
There was a total of 92,741 homes (including single families, condos, and multi-families) sold in Massachusetts in 2016, a 10% increase over 2015.
Below is a graph that illustrates home sales per year since 2005.
2016 Sales by Month
2016 only had two months that weren’t bigger than their corresponding 2015 months – July and October. Other than that, ten of the remaining 12 months saw double digit percentage growth. This mostly landed in the early months of the year. The huge snowfall we had in the beginning of 2015 pushed the usual busy spring market into summer, meaning 2016’s more typical spring season had no trouble out-performing 2015 in those early months of the year.
Average sale price (across all three home types we examine: single families, condos and multi-families) was up in MA by just under 4%, rising from $381,841 in 2015 to $396,049 in 2016. Individually, the average price for a single-family home was $436,169 (up 4% from 2015), for a condo was $320,449 (up 5%), and for a multi-family was $415,881 (up 2%).
Home Prices per County
The majority of Massachusetts counties had another strong year of home growth! The only counties that fell in average price were: Berkshire, Dukes, Hampden, and Hampshire Counties. The decline in average price was small, with 2 out of 4 falling 1%, and the other two falling just under 4% each.
Inventory of Homes for Sale
In 2015 we started the year with the lowest inventory levels in 11 years for January – and in 2016 we started it even lower. In fact, 2016 had lower inventory month-to-month almost across the board when compared to the previous two years. We came out with a report in December that goes into detail about how December 2016 had the lowest inventory of any December since 2001.
Homes Listed for Sale
Homes listed for sale in 2016 were down from 2015 for 9 out of 12 months of the year. The only months that saw growth over 2015 were the first three of the year: January, with an increase of 10%, February, with an increase of 52%, and March, with an increase of 26%.
Overall, there were 3% fewer homes listed in 2016 than in 2015, a decrease from 110,052 to 106,469.
Pending Home Sales (contracts accepted)
Pending sales didn’t see a startling increase, either, with 7 months out of the year having increases over 2015.
In terms of the year overall, 2016 had a 4% increase in the number of homes that went pending over 2015. This is an increase from 87,119 in 2015 to 90,828 in 2016.
With the inventory of homes for sale currently lower than it has been this century it is clear that we will be in bidding war madness very soon. This is exactly why we advise Sellers to List in the Winter to beat the competition and make more money. As reported in our December housing report homes listed was actually down by 14% which is part of the reason that inventory is so excessively low. Then to make inventory matters worse the amount of homes listed from Jan 1st to 20th was about 10% less than last year. We can only speculate that the change in Presidents may be the cause for homeowners to delay listing their homes. Perhaps they are taking a wait and see approach. Time will tell on that.
Those who list by March will be happy they did as they will sell for more. As we get into spring inventory will rise as more and more homes are listed. If buyer demand stays where it is inventory will likely stay below last year’s level. This will cause prices to rise more especially in the first half of the year as we have seen over the last few years. We expect sales to be up but not by much more than 2016. Prices however should rise even more.
*Data provided by Warren Group & MLS PIN and compared to prior year.
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