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Sellers holding out for higher prices?

Posted by Scott Van Voorhis  October 1, 2012 07:39 AM

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That's local economist Michael Goodman's take on the steadily dropping number of homes for sale on the market.

Co-editor MassBenchmarks, the influential journal that tracks the Massachusetts economy, Goodman is an associate professor and chairman of the public policy department at the University of Massachusetts Dartmouth.

And Goodman contends that sellers holding for higher prices down the road is major factor behind the dwindling number of for-sale signs.

Overall, the inventory of homes for sale across the state plunged 22 percent in August and has dropped seven in the last 10 months, the Massachusetts Association of Realtors reported last week. There was a seven month supply of unsold homes on the market at the end of August, a dramatic shift compared to August 2011, when there was nearly a year's worth of properties languishing on market.

"Press reports ... are leading some buyers to believe if they hold their homes off the market until later, they will be able to get a better price," Goodman told a breakfast meeting of the Corridor Nine Area Chamber of Commerce out in Westborough. "You are starting to hear anecdotal stories of people fighting over properties."

OK, the state of the real estate market was just a small part of Goodman's presentation to local business owners and executives, which dealt with the immediate future of the Massachusetts economy.

But if I were looking to sell my house, I would have listed it right away after hearing Goodman's take on where the local economy is headed. (Though Goodman may want to wait himself - he joked how he bought his house in 2005, at the peak of the bubble.)

Massachusetts, especially Greater Boston, has outperformed the national economy for years now.

But the growing debt and economic crisis in Europe could hit the Bay State hard given 40 percent of our exports go to the troubled continent, Goodman noted. And if Congress manages to bumble over the fiscal cliff in January, all bets are off, with the Massachusetts economy heavily reliant on federal health care research dollars and defense spending.

"We live in pretty uncertain times," Goodman said. "We find ourselves late in 2012 in a similar place we found ourselves four years ago."

Now that's a comforting thought!

This blog is not written or edited by Boston.com or the Boston Globe.
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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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