The Wall Street Journal gave some press yesterday to “downtown” real estate markets, Boston included. Some comparisons were drawn between the 2005 market (which some say is the height of the market over the past 10 years) and today’s market conditions. Some of the statistics included in the article reference single family homes, which there are little of in the core of downtown, but the “press” is perhaps finally starting to realize that there is a difference between core downtown Boston real estate and the suburbs or pan-US housing.
Prices in the city’s core (Boston) are off less than 1% over the past year, according to first-quarter data from Listing Information Network, (one of) Boston’s MLS system. The real difference today is that homes are staying on the market for 111 days on average, up from 85 days in 2005.
Prices in key neighborhoods, such as Back Bay, the South End, Fenway and the Waterfront, are all up between 3% and 10%. Beacon Hill and the North End, however, are down sharply, as much as 33%. That’s partly the result of a slew of high-end properties that hit the market in 2006 and 2007 that were priced as high as $1.5 million, skewing the price data upward. Even without those sales, however, the median price would be down by double-digit amounts.
“No one is taking prices higher these days just to see if they can get it, like they used to,” Michael DiMella says of Boston’s downtown core. “But you have to come with realistic expectations. This is a highly desirable area, and you’re not going to find a steal.”
Given the supply and demand principles that are present in the city center of Boston, “deals” on real estate are truly few and far between – more to come soon on setting realistic expectations when it comes to downtown Boston real estate.
Related Articles:
Tim Ryan 
My girlfriend and I have just started looking at the real estate market and love the South End; do you think the South End’s prices will remain immune to the current market downturn or will they begin to decrease over the next year? I currently rent in the South End and there are a lot of for sale signs and some of the properties have been on the market for awhile.
Thanks for the comment Kevin, you’ve asked a few different questions, let’s try and look at them. Will South End prices remain immune to the current market downturn? It’s hard to predict exactly what will happen, but try to keep in mind that the downtown Boston market has proven to be insulated (both in terms of prices and foreclosures) from the suburbs and pan-US market.
You’ve seen a lot of fore sale signs, and properties seem to be staying on the market longer. The spring and summer selling season is upon us, the number of listings for sale is indeed increasing (this is a cyclical event, and nothing out of the ordinary). Days on market for listings has been, on average, higher – there are many factors that could play into this. However, properties that are priced right are moving quickly – we have clients that have attempted to move on (specifically South End) properties quite quickly, only to find out that they are already Under Agreement.
When will these baby strollers stop “discovering” the South End. I have lived in the neighborhood for 20 years and I can tell you I have had my fill of “new urbanism” as in: entitled Wellesley Woman who are so HIP that they “really get” the South End. Oh and by the way if you drive your baby stroller into me one more time while yammering away on the cell phone about your “gardener” – I think I will have to drop the bomb.