Recession Proof Areas: Newton Centre? (Boston, Waltham: real estate market, to rent, condos)

[BobbyChoi]

Hi,

Just moved to the Boston area and have been considering a condo in Newton Centre? Just wanted some opinions about "recession proof" areas. There are certainly larger and better condos in areas such as Watertown and Waltham. However, some of these condos are not in the best location.

Is buying a unit in Newton Centre a safer bet compared to other areas?

Thanks for the advice.

[smarty]

Newton is better than Waltham and probably Watertown.

If you're looking for recession proof condo... consider Brookline or Back Bay Boston.

However, at this time renting is more attractive than buying...
http://www.cepr.net/documents/public...ty_2008_05.pdf

However, if you can buy a condo @15X of yearly rental, I'd say go for it.

Math is so bias towards renting... paying $400 condo fee, $500 in tax, when you can rent for $2K/mo... I don't know how Condo can sell for $400-800K.

[NH2008]

Smarty - My husband just brought that same article home!

The thing is that real estate is so local...it seems like it's about what's happening on your street, in your school district, etc as much as in the city overall. And since in more prestigious areas you pay more to begin with, are they always a better investment? What if the less pricey areas have already fallen quite a bit and Newton Centre hasn't yet?

OP, you might want to check out the forums at Boston Bubble - Boston Real Estate Market Analysis

good luck!

[smarty]

The thing is that real estate is so local...it seems like it's about what's happening on your street, in your school district, etc as much as in the city overall. And since in more prestigious areas you pay more to begin with, are they always a better investment? What if the less pricey areas have already fallen quite a bit and Newton Centre hasn't yet?

Yes. RE is local. However, it should not matter as the rent to purchase price ratio would take care of that in any area. For example, if Newton centre is more expensive to buy, it should also be more expensive to rent. What is unreasonable is when you buy a $400K condo and can only rent it for $2K/mo. It does not even cover mortgage with a 20% down. Rent tracks much better with income.

I find interesting... more people want to move to a prestigious area. The RE prices alway go up first in those areas/towns after a dip. Hence, they are usually last to drop and first to recover. Always buy at low end price range of a town.

[jayrandom]

I'd like to add that better areas tend to have less volatility, meaning that they don't go down as much but then that also means that can't go up as much, either. If you're looking for something safe for your money, Newton is probably a good bet. If you're looking to make a killing in the real estate market without significant improvements, then Newton probably won't be the place. Just look at the % splits in home price in Waltham vs. Newton on Zillow. For 1 year splits (i.e. % change over the last year) Newton beats Middlesex and MA, but for 10 year splits (i.e. % change over 10 years) Newton lags behind both.

You should figure out where you want to live and move from there. Newton is definitely a safer bet, but that safety does come at the definite cost of offering a smaller possible payoff. When it comes to finding a place live, I think it ultimately comes down to the ultimate piece of advice: pick somewhere you'd like to live.

I think Smarty's last piece of advice is especially good, though. You are better off at the low end of a town (or city).

[Pear Martini]

Brookline. period.

edit:just make sure you're not really close to "High St." and you will never have to worry. I like High Street, but for property value reasons I would stay away.

[maggiekate]

check out the J.P. area also for good deals. It is near Boston down town and does
have alot of perks. The pond, good transportation, a plus with gas. Arlington also may be a choice near waltham.