August home sales drop to lowest level in 2 decades

Globe Staff

Sales of Massachusetts single-family homes in August fell to their lowest level in more than two decades as the housing market continued to feel the effects of the expiration of a federal home buyers tax credit, the Warren Group said today.

On a volume basis, 3,659 single-family homes were sold in Massachusetts in August, an 18.5 percent drop from August 2009, said the Warren Group, a Boston firm that tracks local real estate activity. August 2010 was the second consecutive month of year-over-year sales declines.

"This is the first time sales have fallen below 4,000 in the month of August since the Warren Group began tracking data in 1987," the firm added.

Sales of single-family homes edged up from a month ago, when there were 3,590 sales of single-family homes.

"Sales volume in the real estate market remains slow as an after-effect of the expiration of the popular tax credit for home buyers," Warren Group chief executive Timothy M. Warren Jr. said in a statement. "Anxiety and uncertainty in the minds of consumers regarding rising foreclosures, the economy, jobs, and financial markets all played a role in keeping potential home buyers on the sidelines this summer. I'm afraid that the slumping real estate market led the country into the recession and the market's continuing malaise is holding back any kind of strong economic recovery."

The median price of single-family Massachusetts homes rose 3.9 percent to $315,000 in August, up from $303,000 a year earlier and dropped from a month ago when the median price was $320,000, the Warren Group said.

As for August condominium sales in Massachusetts, they fell 23.3 percent from a year earlier, with 1,620 condos selling in August. Condo sales increased slightly from a month earlier. The median selling price for a Massachusetts condo was $298,500 in August 2010, up 8.5 percent from a year ago, the Warren Group said.

The Massachusetts Association of Realtors also issued a report today on the local housing market. The association uses a different method to track sales than the Warren Group does.

Association president Kevin Sears commented on the August sales figures in a statement.

“With median prices continuing to climb year over year and sales slightly increasing from July to August, the market is slowly starting to move in a more positive direction,” Sears said. “While questions about the economy and unemployment remain, the record low interest rates continue to benefit those consumers who are in the market to buy a home now. We can’t forget about the long-term value of home ownership, and the importance for buyers to follow a timeline that is right for them, regardless of the market.”

On sales volumes for single-family homes sold in Massachusetts in August, the association reported an 18.4 percent decrease from the same time last year.

"The median selling price for single-family homes in August was $330,000 an increase of 4.8 percent compared to $315,000 in August 2009," the association said. "This is the 10th straight month of year-over-year price increases."