It looks like college students and those suffering from pandemic-induced breakups forced to move back in with their parents will have to suffer for a bit longer. Despite the real estate market in Massachusetts slowly cooling down, prices continue to be exorbitant, which means the majority of those who are looking to purchase continue to be out of luck.
Housing trends are predictable for the most part. Every year, the fall and winter seasons cause slowing while spring and summer sales run rampant. This is evident as people scramble to get settled before it comes time to register their kids in a new school district, or they simply don’t want to pack up and move during snowstorms.
But the pandemic completely displaced the market and, more vulnerable communities are struggling. This includes historically marginalized groups and those who are leading financially stable lives but want a little more. Regardless, it seems that we are all out of luck these days.
The market may be slowing down as we head into the colder months, but that doesn’t mean prices will change much. Normally with lower demand, we see lower prices, but experts expect pricing to remain high and near the same rate as the last year.
In fact, prices are estimated to be up by nearly 30%, even now, according to The Warren Group. That can be as much as $100,000 for single-family residences in some cases. Very few people can afford that jump, so the new normal seems to be that buyers are willing to wait.
If prospective buyers love a home, but it’s priced out of their reach, they are willing to wait a week and see if it’s still on the market before making an offer at a lower price. Buyers are also slowing down on their willingness to waive all contingencies, including inspections. With less competition for winning contentious bidding wars, many sellers realize the hard way that overpricing their home and taking advantage of the market is no longer a right of passage in this market.
The reality is that there is no longer a crystal ball and no way rely on past price increases to sell a home at the top of the market. It seems as though we are heading into a calmer season that may reap major benefits for buyers who were previously left out of the blazing market. While you may not find substantially lower prices, you may find peace of mind in not having to wave every contingency to simply find a place to settle down.
While, there’s certainly no shame in moving back in with parents or crashing on a friend’s couch as you wait for things to blow over, but recent data shows that we might be headed in a more favorable direction. So don’t unpack your blender and rock collection just yet!
In the meantime, you might also consider townhomes or condos that have a lower markup rate than a single-family standalone. Or, wait until later this year when traditional trends take hold and see if there is a break in your favor. The market might be correcting and it may advantage patient buyers.