From our CEO - A Return to Normalcy Amid Rising Pressures
As we dissect the latest data, two central themes dominate the narrative this month.
Interest Rates and Affordability: A marked surge in interest rates, now hovering around 7%, has struck the housing market with a force we haven't witnessed since 2002. The combination of market appreciation and this significant rate jump – from 3% just two years ago – has caused the average mortgage payment to be 85% more expensive for the same house. This has deep ramifications on affordability, potentially locking out a segment of previously qualified buyers.
Inventory Squeeze and Demand Dynamics: While price appreciation has found its equilibrium, returning to a normal pace, the lack of inventory continues to resonate not just in Greater Boston but across New England and nationwide. A notable reduction in multi-family sales by 32%, single family sales by 25%, and condo sales by 23% year-to-date has tightened the market further. Yet, the demand for homes remains unrelenting and intense, highlighting the resilient nature of our real estate market.
In a complex environment where interest rates challenge buyers and inventory remains constrained, the housing market in Greater Boston echoes a broader national trend. We continue to see the keen interest in homeownership, even as certain barriers make it a challenging landscape to navigate.
Our complete report, enclosed, delves into these dynamics in detail. The Leading Edge team remains committed to offering you the insights and guidance you need in these ever-changing times.
Stay informed, stay ahead, and feel free to reach out with any questions or for further analysis.
Best,
Linda O'Koniewski
CEO, Leading Edge