Low inventory causes Mass. home sales to slip, the Warren Group says

Single-family home sales in Massachusetts fell in February, reversing 13 straight months of rising sales volume, said the Warren Group, adding that low inventory and strong comparisons were factors in the decline.

Timothy M. Warren Jr. Photo taken from the Warren Group’s website.

A total of 2,246 homes sold statewide in February, a 5 percent decrease from the same month a year ago. Meanwhile, the median price for a single-family home increased more than 12 percent last month to $275,000, the Warren Group said in a monthly report on the Bay State market that was released this morning.

“Two factors caused this modest drop in February: low inventory and a comparison with a strong previous year of sales,” Warren Group chief executive Timothy M. Warren Jr. said in a statement. “Even so, I’m still hopeful for a strong spring market. As more sellers list their homes in the spring, activity will pick back up.”

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Warren added: “With such low inventory, we’re seeing bidding wars—homes selling above the asking price. As prices rise, more sellers will begin to list their property, which in turn pumps up sales volume.”

There were 925 condo sales in February, up nearly 1.4 percent, said the Warren Group, a Boston firm that tracks real estate activity.

The median price for condos in February rose more than 6 percent to $245,000.

Separately, the Massachusetts Association of Realtors issued its own monthly report on the local housing market today. The association uses a slightly different method than the Warren Group does to track residential real estate activity.

According to the association, “a lack of inventory” pushed the number of closed home sales down in February after 19 months of year-to-year increases.

In Massachusetts, there were 2,168 detached single-family homes sold in February 2013, a decline of 5 percent.

The median selling price for single-family home in February was $278,000, up 8.9 percent, the association said.

“Demand has outpaced supply with plenty of motivated buyers, but not enough homes for sale to meet the need,” association president Kimberly Allard-Moccia said in a statement. “If inventory continues to go down, there is a good chance we will see sales decline as well, which is not what the market needs.”

At the end of February, the inventory of single-family homes listed for sale in Massachusetts was 18,820, down about 28 percent from the same time in February 2012. That was the biggest drop since the association started charting year-to-year comparisons in January 2004.