High prices, high interest rates, and even rainy weekends are all keeping the area’s housing market in slow motion.
Sales of single-family homes and condos in the area remained at their lowest levels in more than a decade in October, according to data released Tuesday by the Greater Boston Association of Realtors. Meanwhile, prices have continued to climb at double-digit rates year over year, thanks in large part to a shortage of homes for sale.
“The prospect of facing higher mortgage interest rates, rising home prices, and increased competition in this tight inventory market has not only diminished purchasing power, but It also led to a decline in overall housing demand.” . “The wet weather this summer has not helped much in attracting buyers to the market.”
It’s a trend that has continued throughout most of the year. High interest rates have effectively shut down the market as homeowners reject the prospect of selling and taking out a more expensive mortgage to purchase a new home. Combined with slow new construction, there simply isn’t enough to buy, keeping sales volume low and driving prices up.
The median price of a single-family home in the 64 cities and towns covered by GBAR rose 10.8 percent from the previous year to $829,950. The median apartment price rose to $694,812, an increase of 13.7 percent. Both prices are the highest ever seen in October.
“The consistent price gains that have occurred over the past year are largely a result of lower inventory in the market today,” Socha said. “Although there are fewer buyers in the market today than there were two years ago, or even last spring, we do not have enough listings to meet demand, and this imbalance continues to put upward pressure on home prices.”
Sales activity, especially in the middle and upper ends of the market, has picked up over the past month due to an influx of new listings after Labor Day, Socha said. Buyers in these market segments tend to be less sensitive to interest rates, Socha said.
Prices have fallen slightly since reaching all-time highs this summer, when single-family prices reached $900,000. GBAR said it had seen evidence of underpricing from sellers who may have overpriced their homes.
Tim Logan can be reached at firstname.lastname@example.org. follow him @bytimlogan.