RISMEDIA, January 31, 2011—September, 2010 was the first month of the year when closed single-family sales over $1 million did not exceed the year before. Of concern is the fact that similar declines also occurred in October and December. Last month, 127 single-family homes conveyed in Eastern Massachusetts (excluding the Cape and Islands and towns west of Worcester County) priced over $1 million—and this was eight fewer than the same month last year—a 6% decline. The good news, however, is that December 2010 was well ahead of the same month in 2008 (74 sales) and 2007 (76 sales). The market for million dollar houses is still in recovery, but we remain very far off the peak levels of a few years ago.
On a year-to-date basis for the year 2010, 212 more single-family houses have sold over $1 million than the same twelve months of 2009, for an increase of 20.3%. Last year, the market absorbed 1,042 million dollar houses between January and December; the comparable number in 2010 is 1,254.
As sellers contemplate putting their luxury homes on the market this year in anticipation of the spring market, they need to be aware of the imbalance between supply and demand (much more supply than demand) and the skittishness of potential buyers at the high end of the market.
The $2,000,000 to $2,999,999 price segment is also recovering, but it is a much more thinly-traded market than many homeowners realize. Sales in this price band account for only 167 of 1,254 million dollar plus properties conveyed. This is under 14% of the entire million dollar market.
On a year-to-date basis, 44 more single-family houses have sold between $2,000,000 and $2,999,999 than the same twelve months of 2009, for an increase of almost 36%.
For all of MLS PIN (including Cape Cod and the Islands and Western Massachusetts), 1,331 single-family houses sold in 2010. While 104 towns are represented in the 1,331 closed sales, the data are skewed towards the more popular communities. The top five towns (Wellesley, Newton, Brookline, Lexington, and Boston) account for 38% of the closed million dollar sales. As has been true all year, there is a heavy concentration of sales in this price range in the towns with the closest proximity to the City of Boston. It is interesting to note that Needham is the only one of the top 11 towns for million dollar sales in which Hammond does not have an office.
Additional statistics include:
-The average price for a single-family home sold over $1 million in 2010 was $1,586,357
-The average house in this price range had 11 rooms and approximately five bedrooms
-On average, these houses sold at 93.23% of their original listing price—underscoring yet again the importance of accurate pricing in today’s market. Listings priced too far over market value are not selling.
-For all of MLS PIN (including Cape Cod and the Islands and Western Massachusetts), 449 condominium units sold in 2010.
-16 cities and towns are represented in the 449 closed sales, but Boston alone accounts for 78.17% of the closed million dollar condo sales.
-The average price for a condo sold over $1 million in calendar 2010 was $1,774,903. (Interestingly, this is higher than the average sales price for a single-family home in the same time period: $1,586,357).
-The average condo in this price range had six rooms and approximately three bedrooms
-On average, these condos sold at 95.04% of their original listing price. Price it correctly and it will sell; overprice a unit and it will languish on the market.
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