Here's the latest installment of Bates By the Numbers, a weekly feature by Boston real estate agent David Bates that drills down into the Hub's housing market to uncover those trends you would not otherwise see. Follow him on Twitter and check out his ebook, Context: Nine Key Condo Markets, 2.0.
Boston, remember when you used to have modestly priced condos, condos that you could buy for under $500,000? Weren't those days wicked pissah? Today, while the existence of a $250,000 condo in the area is treated with all the fanfare of an urban sighting of Big Foot, I'm starting to think the National Wildlife Foundation should declare sub-$500K Boston condos an endangered species.
I have to admit that amidst my current property search frustrations, I often wax nostalgic recalling those days when I would drive around the city and its surrounding suburbs and see glorious after glorious "For Sale" offerings of modestly priced sub-$500K condos. If memory serves me, there were so many that you could actually trip over them.
In fact, using my MLS way back machine on Tuesday, I saw that on Aug. 26, 2010, you had more than 1,155 condos priced under $500,000, Boston. And your friends Brookline, Cambridge and Somerville had another 336. What's more is that in those days, $500K meant $500K. Nobody had ever heard of offering $50K or $100K over ask.
And, of course, back in the days it was O.K. if you were a buyer and didn't have a duffel bag full of cash to bring to a closing. Sellers would actually accept offers that needed a mortgage. Imagine that. I know, it seems awfully risky, but it really happened.
Additionally, buyers could actually put a contingency or two in their offer. And although it might seem incredible, sellers were very happy to just get their list price. It didn't take an OMG over-ask to bring a smile to the seller's face. That's what happens when you have a little inventory, Boston, just in case you forgot.
Even though it's been just a few years since you had all those modestly priced condos, it's starting to feel like days gone by, like the days of my youth. Today, I looked at my MLS and you know what I saw? Only 221 Boston condos priced under $500,000, of which only about half (118) are on a second floor or higher and only about a quarter (52) have at least 1,200 square feet. That's an 80 percent loss of inventory, Boston.
And that huge inventory that was available in Brookline, Somerville and Cambridge, well, I'm sorry to say that it has tanked harder than the Red Sox. In fact in those markets, for every sub-$500K condo on the market today, there were almost eight on the market just four years ago.
I guess all this information begs the question, who has been in charge of your sub-$500,000 production, Boston? The same person who has been in charge of your weather?
· Our Bates By the Numbers archive [Curbed Boston]