Mass. home sales — and price gains — slow down in September

Adobe Stock

The number of single-family homes sold in Massachusetts sank 10.4 percent in September, compared to the year prior, according to real estate analytics firm The Warren Group.

However, the sharp sales slowdown was almost bound to happen: A year ago, Massachusetts saw 6,439 single-family home sales — the most ever recorded in the month of September. October, November, and December of 2020 set single-family sales records as well.

“The second half of last year really was extraordinary,” said Warren Group chief executive Tim Warren. “And median prices were rising by 15 percent or more each month, too.”

In fact, compared to the 5,031 Massachusetts houses sold in September 2019 — a more typical year for the real estate market — last month’s total of 5,771 single-family home sales marked a 14.7 percent increase. “We’re way above 2019, so it’s certainly not a bad month by any stretch of the imagination,” Warren said. Still, he noted, declining sales can be a precursor to lower prices — or, at least, prices that don’t rise as quickly.

An encouraging sign for frustrated homebuyers is that the median price of a Massachusetts house sold in September increased a more modest 7.4 percent year over year, from $474,000 in September 2020 to $509,000 last month. “It’s the first time we’ve had a single-digit increase in median price for single-family homes in quite a while,” Warren said.

A 7.4 percent jump in prices would still be a big increase in most years. But given that median prices leapt 26.1 percent in June, Warren sees any slowdown in price growth as beneficial.

“It would be good to see some moderating prices — there’s less risk associated with people not extending themselves quite so far,” Warren said. He says we may see year-over-year median price gains in the four- to seven-percent range in each of the final few months of 2021. “I think prices will continue to moderate — they may never actually dip, I’m not sure — but I don’t think they’re going to be going up by double digits again soon.”

Between the high prices and limited inventory to choose from, it’s still a difficult landscape for homebuyers, though. “Single-family homes have just gotten too expensive for a lot of buyers,” Warren said. “The people who can afford homes already have them, while those with more modest budgets have been left with next to no options.” Historically, he added, priced-out buyers could expand the radius of their home search to find a market with less competition. “But with more people working remotely, this tactic doesn’t work like it used to.”

Between September 2020 and last month, the median price of a single-family home in Kyle Schwarber’s “adopted hometown” of Waltham rose 21.5 percent, from $675,000 to $819,900. In Hopkinton, the price of a typical house rose 34.3 percent over a year ago, from $652,500 to $876,450. Even in traditionally more affordable Gateway Cities like Lynn, Lowell, Haverhill, and Brockton, the median price of a single-family home topped $400,000 in September.

Meanwhile, at least half a dozen Boston-area communities have joined the seven-figure club this year. In Carlisle, Hingham, Sherborn, Somerville, Sudbury, and Westwood, the median price of a single-family home sold in 2021 now tops $1 million. Arlington, Jamaica Plain, and Wayland aren’t far behind. (See town-by-town sales data here.)

The condominium market had a similar September: The 2,471 condos sold statewide last month marked a 1.4 percent decrease from the prior year — but a remarkable 25.2 percent jump over the more typical September of 2019. The median price of a Massachusetts condo, meanwhile, rose 6.7 percent from a year ago, to $445,000.

Sales of condos were up 13.7 percent year-over-year in Suffolk County, which includes Boston, Chelsea, Revere, and Winthrop; the median price of a Suffolk County condo was $695,000 in September, up 11.2 percent from a year ago. (See county-by-county data here.)