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.
A little more than a year ago, I did a chart that broke down Boston condo sales in the first half of 2013 into 10 different price ranges. The chart reflected the neighborhoods that dominated each price range. Recently, I researched the same data for the first half of 2014 and immediately saw about a 10 percent increase in prices. Here are some other differences vs. the same period in 2013.
Modest Price Ranges
Last year, Brighton was the dominant condo neighborhood in the modest price points. But in the first half of 2014, Brighton sold nearly 25 percent fewer condos than it did in the first half of 2013.
Additionally, Charlestown was also previously a stalwart community for sub-$500K condominium sales. But in the first six months of 2014, Charlestown's sub-$500k condo sales dropped 36 percent.
Without doubt, the lack of sub-$500K inventory citywide has provoked a resurgence of the Dorchester condo market, the new dominant player in Boston's more modest price ranges. In the first half of 2013, Dorchester sold only 143* condos, but in the first half of 2014, DOT closed 205* condo deals, a 44 percent increase.
The dramatic increase of Dorchester sales clearly communicates that if listings won't come to the neighborhoods of the people, the people will come to the neighborhoods of the listings.
While folks rightfully decry a lack of development in the city, South Boston is one of the few Boston neighborhoods where you see small to medium development projects on just about every corner. Clearly, if South Boston builds it, the sales will come. In 2014, Southie transactions were up 11 percent vs. the first six months of 2013.
The growth in South Boston sales has allowed it to be the dominant destination for four Boston price ranges this year, up from three price ranges last year.
There is another important change in South Boston condo pricing that should be noted: In the first half of 2014, South Boston transactions under $500K were down almost 15 percent (166 to 142), but South Boston transactions above $500K grew 65 percent (86 to 142). Additionally, in the first six months of the year South Boston sales over $700K tripled (13 to 39). Way to go, South Boston!
The South End is still the dominant destination point for Boston buyers in the second and third highest price ranges, but transactions in the South End in the first half of 2014 were down 16 percent. A lack of inventory caused South End sales in Boston's most elite price range (more than $1.24 million), to drop 33 percent, from 49 sales in the first half of 2013 to just 31 sales in the first half of 2014.
In Back Bay, transactions in the first half of 2014 were down 10 percent vs. the same period last year, but Back Bay still dominated Boston's most elite price range.
*Sales numbers based on a Dorchester ZIP code analysis as some brokers identify their Dorchester listings only as "Boston" listings.
· Our Bates By the Numbers archive [Curbed Boston]