Interest rates cool down Boston's hot housing market
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Illustration: Brendan Lynch/Axios
The tight housing market is beginning to slacken, if only slightly.
Driving the news: Realtor RE/MAX's October report showed 30.7% fewer closings around the country than in the same time period in 2021, with 36.8% more homes on the market.
- The average home took 35 days to sell, nearly a week longer than last year.
- Every month of 2022 has seen fewer home sales than in 2021, according to RE/MAX.
Zoom in: Data from the Massachusetts Association of Realtors shows the Boston area going along with the national trend.
- The median sale price of a single-family home in Massachusetts dropped over 4% to $547,000 in October compared to September.
- New listings are down nearly 19% in Massachusetts, and closed sales went down nearly 18% for single-family homes since September.
Why it matters: A cooling housing market means consumers have more choice and can explore multiple homes instead of being rushed to close on one of a few available ones.
- Higher interest rates are partly responsible for the softening market.
What they're saying: "The historic pace and magnitude of interest rate increases have created a reset and softened the housing landscape as intended," said RE/MAX president Nick Bailey in a statement accompanying the report.
- Bailey said most buyers are more concerned with affording a down payment and a monthly mortgage than they are with climbing interest rates.
The big picture: The state's lack of housing inventory is what causes sky-high prices and is still the most daunting problem for those looking to buy their first home.
With a few exceptions, Boston home prices trend down
The average sale price for a home in greater Boston is trending downward, but lower costs aren't uniform across the area, according to data provided to Axios from Zillow.
- Peabody has seen the area's biggest dip in home prices with a 2.4% decline.
- North Reading prices were down 2.2%.
Yes, but: Some areas bucked the trend.
- Homes in Needham jumped up 3.1% while neighboring towns like Dover and Wellesley saw increases over 1%.
- Crossing the state line into New Hampshire, prices continued to climb. Newton, N.H., saw prices increase 2.1% while Durham was up 3.8%.