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Buyer alert: Rising prices ahead

Posted by Scott Van Voorhis May 22, 2012 05:52 AM

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We are primed for a home price turnaround in Greater Boston and across Massachusetts.

And we are not talking about 2013 or some other distant year in the future, but the next several months.

That's the verdict from Tim Warren, chief executive of The Warren Group, after the release this morning of home sales and price numbers for April by his Boston-based real estate data firm and publisher.

Warren points to the combo of falling unemployment and rock bottom interest rates as the key factor behind the budding rebound.

It's an unusual prediction in that it doesn't hedge and point to 2013 or some other relatively distant point, a favorite tactic of prognosticators. Of course, we can also see pretty readily whether it proves accurate or not.

"Median prices posted an increase last month and are nearly flat year-over-year, which indicates they may have hit bottom and will start to increase in the second half of the year," Warren said in a story posted on the Banker & Tradesman website.

Single-family home sales surged 22 percent in April compared to the same month a year ago, for a total of 3,505 homes sold across the Bay State, according to The Warren Group. Year to date, sales are up 18 percent over the same period in 2011.

The state's median home price also posted a year-over-year increase in April, rising a modest 1.1 percent to $275,000

In this case, the direction may be more significant than the amount, with the increase reversing a seventh-month swoon that began last fall. (For those of you who don't already know, among my many business reporting gigs I also write a weekly column on a wide range of Massachusetts business issues for Banker & Tradesman, which is owned by The Warren Group.)

Condo sales and prices are also on the rise again as well. The median condo price posted a 3.5 percent, year-over-year increase in April, to $280,000, The Warren Group reports. Condo sales rose 12 percent over April 2011 to a total of 1,363.

While this may be encouraging news for sellers, it's not the greatest for home buyers.

A seven month stretch of falling home prices, on top of earlier declines, had finally appeared to be opening up some relative bargains for buyers across Massachusetts.

Yet even with the downturn, home prices have remained relatively high, both in the ever inflated Boston area and across Massachusetts.

Now it looks like the affordability window may already be starting to close before it really opened much. Of course, it depends on where you are buying - if you are prepared to drive an hour or more to work each day, your options are wider.

So gang, what's your take?

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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About boston real estate now
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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