Are buyers turning to condos as they find themselves on the losing end of soaring single-family home prices?
It happened during the bubble years and in previous booms as well. And it looks like it may be happening again given the latest Massachusetts sales stats out this morning
Bay State condo sales jumped more than 15 percent in December compared to the year before, even as home sales slid - by just under a percent - for the fewest sales since April, The Warren Group reports.
Yet even as home sales faltered, home prices rose yet again in December amid a dearth of listings for buyers to look at, with the median price hitting $320,000, a 6.3 percent jump over 2012 and an increase over this November as well, the Massachusetts Association of Realtors finds.
And despite the stagnant sales numbers, demand still appears to be relatively strong, with the drop in sales driven by the sparse choices in the market as much as anything else.
Even as home sales stagnated in December, average days on market dropped to 99 days, down from 130 in December 2012, according to MAR.
By contrast, condo prices look a little more reasonable, though that window appears to be closing as well.
The median condo price rose 8 percent in December, to more than $305,000, MAR reports. The median condo price for all of 2013 - $300,000 - was the highest since 2004.
While generally less expensive, condos have the perception as being a riskier bet than singe-family homes. There's more price volatility with condos the poster child, at least in New England, of the devastating early-1990s real estate collapse.
Many of those who snapped up condos during the greed-is-good 80s were stuck with them for years, unable to sell, period, let alone settling for a loss.
Developers during those heady boom times got the very dangerous idea they could turn any old building anywhere into overpriced condos and stuff their pockets with easy profits.
Bad bets include the downtown Haverhill condo next to a car dealership that one of my former newspaper colleagues was stuck with from his bachelor days.
He wound up renting it after he got married and bought a house - he may very well still be sitting on it, though I suspect he finally found a way to unload during the bubble years, circa 2003-2006.
Ready to go condo? Homes too expensive for you now? What's your take?
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