Housing market seems to be softening (Boston: real estate, 2015, insurance)

[Guineas]

Seeing a lot more price reductions lately throughout Greater Boston area including Boston than in the past 5 years ever. Anyone else feel the same? Seems like higher mortgage interest rates (still below historic norms) and maybe the property tax deduction caps are putting a stop to the boom. Also Chinese real estate investment interest has declined rapidly since the trade war started.

I think it's a good thing, the Boston housing market has been a bit frothy and unsustainable in the past 3-4 years. A house is a place to live, shouldn't be the primary retirement cashout plan.

[massnative71]

Originally Posted by Guineas

Seeing a lot more price reductions lately throughout Greater Boston area including Boston than in the past 5 years ever. Anyone else feel the same? Seems like higher mortgage interest rates (still below historic norms) and maybe the property tax deduction caps are putting a stop to the boom. Also Chinese real estate investment interest has declined rapidly since the trade war started.

I think it's a good thing, the Boston housing market has been a bit frothy and unsustainable in the past 3-4 years. A house is a place to live, shouldn't be the primary retirement cashout plan.

Let's just hope the trend continues.

[katzenfreund]

I hope so too. The prices of houses was rising a lot faster than incomes...even in the "cheap" areas. Combine that with the rising cost of everything else (for example our home insurance just went up over 10 percent for the third year in a row, even though we have never filed a claim), electricity, prop. taxes etc. etc. it makes it awfully hard for young people to buy their first home.

[sunguy13]

Agreed. Have been looking at the northern suburbs of Boston for a couple months and have seen price cuts on quite a few homes. Although we see price cuts, Boston will maintain a healthy local economy and prices will stabilize, but not by a lot.

Originally Posted by Guineas

Seeing a lot more price reductions lately throughout Greater Boston area including Boston than in the past 5 years ever. Anyone else feel the same? Seems like higher mortgage interest rates (still below historic norms) and maybe the property tax deduction caps are putting a stop to the boom. Also Chinese real estate investment interest has declined rapidly since the trade war started.

I think it's a good thing, the Boston housing market has been a bit frothy and unsustainable in the past 3-4 years. A house is a place to live, shouldn't be the primary retirement cashout plan.

[Shrewsburried]

Not surprising given rising interest rates, the cap on mortgage deductions, and turbulent financial markets.

This said, I don't think those looking seeking entry to mid level housing will see any breaks soon. If anything, tightening markets good very well stoke more competition for affordable housing.

In central MA, I've seen a slight ramp in activity. Talking to me RE/Investor friends, they believe the market slowdown was largely an election hangover and now that the earth has remained spinning, buyers are active again.

[Guineas]

Originally Posted by sunguy13

Agreed. Have been looking at the northern suburbs of Boston for a couple months and have seen price cuts on quite a few homes. Although we see price cuts, Boston will maintain a healthy local economy and prices will stabilize, but not by a lot.

Yeah it's still at a very high plateau since 2015. The price cuts are mainly properties with prices that are overly optimistic, but still encouraging as just last year I saw very little reductions at all and many places were sold higher than asking in the city.

My gut feeling is that things are going to stay about where they are for close to a decade, kind of like the early 1990s. No big dips, but no crazy bidding wars either, and let inflation gradually catch up. May not be a great time to be a flipper (not much room to flip anyway when Dorchester 2bdrm condos cost half a million).

Even for high income earners, the Boston housing market is pretty depressing for those looking to buy without existing equity or capital.

[Guineas]

Originally Posted by Shrewsburried

This said, I don't think those looking seeking entry to mid level housing will see any breaks soon. If anything, tightening markets good very well stoke more competition for affordable housing.

In central MA, I've seen a slight ramp in activity. Talking to me RE/Investor friends, they believe the market slowdown was largely an election hangover and now that the earth has remained spinning, buyers are active again.

Central Mass is still affordable for those with median household incomes.

The young middle class without inheritance or family help is basically priced out of Boston, even most of Mattapan. It's a bad trend for Boston area though, being so reliant on parental help and family inheritance to afford a place to live. Housing prices detached from income is basically how Chinese cities are like. A life of comfort for those who are only child with parents and grandparents who own in the area; but a life of serfdom for those without inheritance since incomes are detached from home prices. If prices continue to go up despite continued interest rate rises, the dependence on parental assets will be even greater.

[tysmith95]

Good. Boston real estate was/is in a bubble.

[btownboss4]

Don’t Prices always go down in the winter?

[CaseyB]

Originally Posted by btownboss4

Don’t Prices always go down in the winter?

Either that or the houses sit on the market longer. It usually picks up in February.