• Neighborhoods of Boston

  • Roslindale
  • Jamaica Plain
  • West Roxbury

• Blog Archives

  • December 2008
  • November 2008
  • August 2007
  • July 2007
  • June 2007
  • May 2007

• Popular Posts

  • A Nightmare on kELMan’s Street?

Market Conditions for Condos in West Roxbury

Posted by: Tim White
Posted on: Thursday, June 21, 2007 at 8:23 pm
Categories: Financing, Home Selling, Home Buying, Market Conditions, West Roxbury

In this second installment of a continuing series on how real estate market dynamics influence residential property values in Boston’s neighborhoods, the focus of this post will once again be on the community of West Roxbury–however this time we’ll target the condo market.  In our last segment, we considered the condition of the real estate market for single-family homes in West Roxbury, and determined that, overall, things were looking pretty good as there seems to be a healthy balance between the amount of inventory for sale and the number of ready, willing and able buyers circulating in the market.  This is good news for both buyers and sellers of single-family homes.

The condo market in West Roxbury, however, tells of a slightly different story, and although there is good new to be gleaned from a careful reading of condo market statistics, the story itself depicts a market segment struggling to recover from a prolonged exposure to downward pressures on sale prices.  Then again, some recent indicators suggest a rebound may be underway.

Before diving into the numbers and the graphs, let’s briefly review the specific purpose, extent and approach of this series of blog posts on the state of the Boston real estate market.  Suffice to say Boston is a significant real estate market in terms of its size and scope, and that it is comprised of multiple subsets of market dynamics between neighborhoods and different property types (condos, single and multi-family).  And although the over-all objective here is to provide readers with a detailed analysis of the real estate market throughout the City of Boston–and to provide insights into the health and condition of said market (which we will do in time)–to achieve this goal it is better to start small.  Thus the decision to approach this  market study on a neighborhood by neighborhood and property type by property type basis.  The cumulative effect of this approach, we hope, will provide readers with a firmer grasp of over-all market conditions city-wide.

Anyhow, back to the West Roxbury condo scene.

As in our earlier analysis of the West Roxbury’s single-family market, we will dissect the condo market by looking at it from different perspectives.  We will examine this segment by using three leading indicators as our tools.  They are:

• Median Sales Price — The mid-point of sale prices, where half the sales are below and half are above said point
• Basic Supply and Demand by Units — The number of for sale properties versus the number of properties that have gone under contract on a month by month basis
• Month Supply of Inventory (MSI) – Indicates how long the current supply of inventory will last (usually forecast by number of months out) given current market conditions and historical demand

So, starting with the median sales price indicator for condos in West Roxbury, let’s examine the following graph:

Again, using a 24-month time-line beginning in May 2005 and ending in May 2007, the trend-line above clearly suggests a steady, but not necessarily dramatic, downward drift of median sales prices.  The graph illustrates an adjustment in the condo market has occurred.  By the numbers, in May of 2005 the median price was at $260,500 compared to a May 2007 median price of $239,000–a difference of 8.25%.  However, the percentage difference between May 0f 2006 and May of 2007 is only about 3% to the negative–a sign perhaps that the downward pressure on price is subsiding.  Another good sign is that the average day on the market for condos in Wet Roxbury for May 2007 (83 day), while higher than in 2005 (70 days) , is in fact lower than the average days on the market for May 2006 (94 days). 

The next indicator, supply and demand by number of units, also suggests that the condo market in West Roxbury has been struggling a bit over the past 2 years.  The last quarter, however, does show signs that it is beginning to strengthen. 

Supply and demand by number of units measures the number of properties for sale versus the number of properties that have gone under contract on a monthly basis.  The postive news depicted by this graph is that in May 2007 the number of condo for sale (83) is shrinking and the number of condos going under contract (11) is increasing when compared with the same figures for May 2006 (113 units for sale/12 under contract).  So, although the condo market has had it’s problems there are definite signs that things are improving.  Still, opportunities for the buy side remains strong.

Finally, we look at the monthly supply of inventory (MSI) indicator for condos in West Roxbury. 

This graph speaks to how many months out it would take to move the current supply of inventory on the market.  Currently, the graph hows that it would take the West Roxbury condo market about 5.7 months to clear out current supplies.  This a little high when you consider that 4.5 months MSI is the current national average, however it is significantly down from May 2006 of 7.4 MSI. 

Again, taken together these three indicators–median sale price, supply and demand and monthly supply of inventory–provide for a good measure of current market conditions for condos in West Roxbury, and allow us to put our finger on the pulse of the market.  My reading of these indicators as applied to this segment is that although the condo market has had its share of difficulties in the past 24-months, which included some needed corrections, there are definite signs that things are heating up as is evidenced by the gap between for sale inventory and under contract inventory–which is decreasing with each passing month.

Looking for more news about the Boston real estate market? Consider subscribing to this blog's RSS feed and have articles like this delivered to your favorite feed reader whenever a new article is published.

Comments

• Frequent Contributors

  • Tim White
    Email Address
    Website
  • Veronique Mendelson
    Email Address
    Website
  • Helen Coen
    Email Address
    Website
  • Deirdre White
    Email Address
    Website
  • Lisa Sullivan
    Email Address
    Website
  • Maureen O'Keefe
    Email Address
    Website
  • Maureen Hayes Rossi
    Email Address
    Website
  • Robert Holley
    Email Address
    Website
  • Rona Cronin
    Email Address
    Website
  • Don Rankin
    Email Address
    Website
  • Carole White
    Email Address
    Website
  • Shari Cloran
    Email Address
    Website
  • Justin White
    Email Address
    Website

• Links

  • Alex
  • Donncha
  • Dougal
  • Matt
  • Michel
  • Mike
  • Ryan