2021 Real Estate Trends & Predictions impacting Greater Boston

The overall housing market in the greater Boston area has been on fire with record-low mortgage rates and a surge of relocations spurred by the ability to work remotely. The most significant trend in 2020 was the exodus of people from the city to surrounding suburbs. This migration has created new opportunities and challenges for both buyers and sellers. The impact will be felt far into 2021. Here are key trends to watch:

1. Shifting dynamic in Boston

Some of Boston’s trendiest neighborhoods were hit the hardest during the pandemic. While this isn’t great news for city homeowners, it has helped to level the playing field for opportunistic home buyers and renters. Both list and rent prices in some areas have been discounted by upwards of 15% off original asking prices. With low mortgage rates and more homes to choose from, buyers are feeling like they have the upper hand. For sellers, it is going to take additional resources to attract a buyer. Creating a solid listing strategy for your home will be critical if you plan to sell this year.

2. Inventory shortages in the suburbs

Home values are largely driven by the principles of supply and demand. On the whole, the market will remain seller-friendly, particularly in areas short on housing inventory. Outside of Boston, many markets across the region are experiencing less than one month of housing supply (a market is considered to be in equilibrium between buyers and sellers when the number of available properties equals six months of sales).

3. Strong spring market

COVID-19 caused an initial pause in the market, but sales rebounded in Q3 of 2020 with record prices being set in many communities in the greater Boston area. That said, many buyers and sellers were uncertain and delayed entering the market in 2020. I’m anticipating an active spring season due to pent up demand and a busy summer.

4. Interest rates remain low

Mortgage rates hit rock bottom in 2020 and I predict they will remain favorably low well into 2021. The Federal Reserve has indicated a desire to keep rates low. While the Federal Reserve doesn’t directly control mortgage rates, oftentimes there is a correlation when low interest rate policies are rolled out.

5. Technology is here to stay

Today’s reality calls for virtual reality. My clients are exploring homes for sale using new technologies, including video, 3D tours and live streaming. These technologies are here to stay and will continue to supplement the home buying and selling experience.

6. Buyers prioritize lifestyle amenities

Top on any house hunter’s wish list is square footage and outdoor space to meet new demands for remote working/learning and activities at home. This is a trend that is sure to continue into the new year as buyers prioritize lifestyle amenities like proximity to beaches and walking trails, and space for outdoor entertaining.

About Dana Bull: Dana is a trusted real estate advisor who assists clients across all aspects of residential real estate. She has advised hundreds of buyers, sellers, and investors across Greater Boston and beyond. Contact her at dana.bull@sothebysrealty.com.

Music to Our Ears: Accepted Offer in Malden

The house hunt spanned an entire school year for Chrissy, a local music teacher, but it was well worth the wait.

Chrissy, who relies on public transit had been saving up to purchase her first home in Medford, Malden or Arlington. Home values in these areas have seen a recent surge thanks to easy commuting options into the city. To justify the high-priced mortgage payment, Chrissy decided that she needed plenty of space. Not only did she want a home that could fit her piano and guitars, she was also looking for a two-bedroom so that a roommate could help cover the housing costs. Continue Reading

Buying a Wicked Cute Two-Family in Salem

Home buying can be scary! Especially when your first purchase is a 150-year-old fixer upper located in Salem, the Halloween capital of the country. Did I mention that it’s a multi-family?

The idea of becoming a first time home owner AND a first time lanlord is enough to send some people running for the hills faster than you can say hocus pocus. My cousin, Evan, and his wife, Meg, were ready for the challenge and enlisted me as their trusted realtor.

After contemplating a few towns in the greater Boston area, they decided that Salem made perfect sense for their commutes, lifestyle, and budget. The couple had more ties to the Witch City than you can shake a broom at. Meg had graduated from Salem State University and the couple married at a historic Salem venue last fall.

They were quick to whip up an offer on an adorable two-family in the incredibly charming Pickering Wharf neighborhood. The property overlooks the House of Seven Gables, a tourist hotspot, and is just a short stroll to the ocean, shops, and restaurants. The home hit the major items on their wish list being in walking distance to the commuter rail and having a good-sized yard for the dog. Not only did the property include a turnkey rental unit on the first floor, it also offered expansion potential into the attic with peaks of the ocean!

After a grueling multi-bid situation (which they won by the skin of their teeth using a strategic escalation clause and thoughtful note to the owner) Evan and Meg were under agreement.

Now is about the time when most buyers start to get a bit overwhelmed. House hunting and submitting offers is mere child’s play. Once there is an accepted offer on the table, things get serious. There’s no shortage of what-if games and second-guessing only to be followed up with moments of clarity and validation.

As to be expected, the due diligence process on an old two family home is intense. The mantra for the home inspection week was “double, double toil and trouble”. Evan and Meg had multiple contractors look at the house. We even had a plumber shoot a camera down the waste line to make sure it was up to snuff. They made friends with everyone at the building department and interviewed the neighbors. While it’s impossible to learn every detail about a house built over a century ago, it doesn’t hurt to do some basic research. No matter what property you buy, you want to go in with eyes wide open to understand the risks and potential pitfalls. But, at some point, you have to take a leap of faith.

Ultimately, the home had been lovingly maintained and the pride in ownership showed. It was time to move forward with the purchase and not look back.

Buying a multi-family property has some extra complexity. Signing up for homeownership is one thing, becoming a landlord is an entirely different ball game. As an extra service, I help clients strategize on the financials of investing as well as providing basic resources for being a successful property manager. To make sure the pair got off on the right foot, we sat down to discuss marketing the rental and vetting prospective tenants.

October is always a busy time in Salem, thanks to seasonal festivities. It’s been especially busy for Evan and Meg. Since closing, they have been hard at work on some sweat equity projects to get their house in tip-top shape while simultaneously securing a tenant for the rental unit.

Happy Halloween to these new homeowners!

A big thanks to my cousins on this review of our work together:

“We were so impressed by Dana’s knowledge and expertise when we finally decided to leap into home ownership. Because of her background she is able to connect with you, as the buyer, on many different levels. Throughout the process, Dana kept us informed, answered our countless questions, and shared her previous experiences both as a buyer, seller, and a realtor. Even when we got cold feet and sent a late-night email with a laundry list of questions and worries, she helped us to understand both the upside and pitfalls to buying an old two-family property. We often said that Dana was not only our realtor but also a source of emotional support with her pep talks. Dana’s work ethic, drive, and knowledge are unparalleled. She not only works hard to make sure the process stays on track but also to make sure you understand what is happening, when it is happening, how it is happening and why it is happening. Going above and beyond to help you get your home is just how she operates. She is truly an amazing realtor to work with.”

 

 

 

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