Warren: Mass. home prices fell 12 percent in 2008
(File photo: Ted S. Warren/AP)
While 2008 will go down as one of the slowest periods in the real estate market in Massachusetts in recent memory, it was also a period that made homes in many communities considerably more affordable.
New data released today by the Warren Group showed that home prices declined nearly 12 percent last year, to a statewide median price of $305,000, from $345,000 the year before. This was the biggest drop in year-over-year prices since the Warren Group started tracking the residential real estate market in 1987. Home prices are about where they were in 2004.
"Home prices in Massachusetts have been declining for the last three years, and the median is now $50,000, or 14 percent, lower than 2005 when prices hit a peak,'' said Timothy Warren Jr., the chief executive of the Warren Group.
In December, the median home price plunged 17.8 percent to $267,250 from $325,000 in 2007. Condominium prices that month also fell 12.6 percent, marking the steepest monthly price drop for 2008.
The number of home sales also plunged 11.5 percent last year from 2007, recording the fewest number of sales since 1991. However the pace of sales did pick up slightly in December, the third month in 2008 that posted a higher number of sales than the previous year period,, The Warren Group said. "It feels like there may be some pent-up demand for housing and that the market is trying to move again,'' Warren said. "But unless sales volume picks up considerably for the next several months, we really won't see prices rebound."
(Please click on "full entry" to see results from a separate report on local housing activity issued today by the Massachusetts Association of Realtors.)
Using a slightly different method to calculate real estate activity, the Massachusetts Association of Realtors issued its own report this morning on local housing.
For all of 2008, the number of detached single-family homes sold declined 13.1 percent from from 41,583 in 2007 to 36,138 homes last year. The number of condominiums sold in 2007 went down 21.1 percent, from 19,798 to 15,628 units, the association said.
"The median price for a single-family home declined 10 percent from 2007 (from $345,500 to $311,000)," the association said in a press release. "The average median price for a single-family home in 2008 falls between 2003 and 2004 levels."
The Massachusetts condominium market saw median prices decrease only 3.7 percent from 2007 - from $282,000 to $271,500, the association said.
As for December, there were 2,622 single-family homes sold in Massachusetts last month, a 3.2 percent increase compared with 2,540 homes sold in December 2007, the association said.
The association added, "In December, the median selling price for single-family homes was $275,000 a decrease of 14.9 percent compared to $323,000 in December 2007, which is back to 2002 levels."
The Massachusetts condominium market in December had a 14.8 percent decrease in the number of units sold when compared with the same month a year ago, from 1,107 units sold in 2007 to 943 units sold in 2008, the association said.
"The median selling price of a condo in December 2008 was $230,000, which is down 14.8 percent from the December 2007 median price of $270,000, which is back to 2003 levels," the association said.
“Prices have adjusted to the point that buyers are seeing real value and taking the opportunity to get back into the market and that is a necessary first step to eventually turning things around,” Gary Rogers, president of the Massachusetts Association of Realtors, said in a statement. “Last year was hard, and we are hopeful that any new stimulus package introduced by President Obama and Congress gets credit flowing to worthy borrowers so they can take advantage of the extremely low interest rates and more affordable prices.”
(By Jenifer McKim and Chris Reidy, Globe staff)
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