I’m sure you’ve been reading and hearing the buzz about the Boston condo market and how strong it is. Buyers are feeling it first hand. When they find properties they like, they’re experiencing the frenzy of multiple offers, bidding wars and prices being bid up, in some cases, above the asking price. This multiple bid fever is a result of a historically low inventory of condos for sale in the market.
A look at condo listings currently on the market in downtown Boston overall and in four prime neighborhoods demonstrates this point. Currently, there are 518 condos on the market in downtown Boston, slightly more than half of what was available at the same time last year. Inventory is down 35% to 63% in the prime neighborhoods of Back Bay, Beacon Hill, the South End and the Waterfront. Relative to the peak in 2008, the decline in inventory is even more dramatic.
A look at the re-sales in 12 full-service luxury buildings tracked by Otis & Ahearn shows 29 re-sales on the market, representing 2.2% of a possible 1,328 units in these buildings compared to the peak date in 2009 (6.12.09) when there were 91 units (6.9%) for re-sale in these buildings. See the chart below. While the report below does not take into account inventory available at luxury buildings still selling out, such as The W and 45 Province, for example, it highlights further the limited choices buyers currently have in today’s market.
So what does this mean if you own a condo in Boston? For owners contemplating a move, this is great news. The downtown Boston condominium market is a strong sellers market. Limited inventory, limited competition, low interest rates for borrowers, and rising prices give owners the upper hand. With limited competition, the window of opportunity to capture rising prices is now. Why wait? Carpe Diem!