Real Estate Trends – Suffolk County, Massachusetts (Multifamily)

Introduction:

This market trend report is out second “County Report” where we look at the entire segment of the market in an entire county to get bigger set of data to examine the whole region.  This is also our first report looking at Multifamily properties.  The advantage of doing this is that we can analyze hundreds of properties rather than just a handful.  In the case of multifamily properties many towns and cities might not have any sales in a given month but across a region it will give more data to examine.

Another note on the type of properties examined.  The data used is from the MLS and not many large multifamily properties are listed on there, as they are usually handled by highly specialized commercial real estate agents.  So the vast majority of these are 2 and 3 family homes with a fair number of 4 families.  However there are a small number of small apartment buildings that are included (most 5-10 units) since there is only a few and they are not more expensive than small units and the number of total units were similar year to year.  If these were clearly skewing the data we would eliminate anything above 4 families.

Today we are highlighting Suffolk County in Massachusetts.  Suffolk County includes the cities of Boston, Chelsea, Revere and Winthrop.

Suffolk County Real Estate - Boston, Chelsea, Revere and Winthrop Map

Market Trends in Suffolk County, MA – October 2013 and 2014:

Suffolk County had about 85 multifamily houses sold in October of each year.  Over these sales the average listed price was down as were the final sale prices and the days on market were up.  Overall the sales were very similar with only a slight decrease from 87 in 2013 to 85 in 2014.

Average Listing Prices:

First we can look at is the average listing price for Suffolk County multifamily properties.  This number went down from$650,803 in October 2013 to $605,100 in October 2014.  That is a decrease of 7.02%, which is pretty significant generally and with about 85 sales in each period it is spread over enough sales to be very meaningful.  This indicates that the booming multifamily market has definitely started to cool down and is starting to really trend down throughout the county.

Average Sale Prices:

The next to examine is the average sale prices.  In October 2013 the average sale price for Suffolk County was $641,708.  Then in October 2014 it was down to $588,598. This represents an even larger decline of 8.28%.  This metric also shows that prices have gone down and that the multifamily market is trending downwards.  The fact that the sales prices are falling a bit faster than the listing prices might show that the regions real estate agents are not compensating for the decline and are trying to still hype up prices on the multifamily houses to last year’s levels.

Average Days on Market:

The final thing to see is how long it is taking for houses to sell in the current market.  In this case Suffolk County the average days on market are up as well as prices being down.  The days on market are up a little bit year over year.  Looking at October of 2013 the average days on market were 54.49 and in 2014 that was up to 61.26, a 12.42% increase.  This is a pretty significant increase given the fairly large data sets we are looking at.

In many of our town reports we saw that in the small data sets that the days on market sometimes were skewed a lot by one place that was very high compared to the rest.  However this is where the big data sets have a big advantage as any single sale is not that big of a factor.  In this case there are some outliers but you actually see the same types of them both years (indicating that they might not be that odd after all) so we did not adjust for them.  The increase of nearly 12.5% is real and a significant factor to consider if looking to sell your multifamily house in Suffolk County.

Suffolk County Summary:

Every metric we look at indicates that the Suffolk County multifamily real estate market has slowed down since last year.  The greater than 7% and 8% declines in listed and sale prices indicate that prices may have peaked in 2013.  The increase in the days on market is also a large concern.  While the pricing declines are the major concern they aren’t the only issue.  The fact that the days on market are also up almost 12.5% it shows it is also harder to sell the properties even at the now reduced prices.  If places sit for longer that will often lead to price drops so if that trend continues it can further push prices down.

In summary if you are looking to sell your Suffolk County, Massachusetts multifamily house you should expect to get a bit little less than you would  have last year and should be willing to take a bigger discount off your listed price to avoid sitting on it for a very long time.

Do you need to sell your Suffolk County, Massachusetts multifamily property fast?  If you would like to sell your home fast and hassle free  schedule a consultation with us today.

Please share your questions and comments below.

 

 

 

(Image credit: Suffolk County Map by Beland, via Wikipedia)

 

 

 

 

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