State of the Real Estate Market: July 2013
2013 has been an extremely strong year for the real estate market across the country. According to CoreLogic, which tracks these statistics, property values are up across the country 12.2% year over year--and that's May 2013 over May 2012.
Some states have seen incredibly strong increases. Nevada at 26%, for example, California at over 20%, Hawaii and Oregon have also seen very strong increases. The only two states, actually, to decline were Delaware and Alabama. Massachusetts is trending right with the national average at 12.2% increase--that's May 2013 over May 2012--and that's something that we're seeing locally as well here in the city and here in the South End, which is a particularly hot market.
In 2012 our average price per square foot for condominiums in June of 2012 in the South End was $617 per square foot. Those properties took 41 days to absorb into the market and in June of 2013 that price per square foot went from $617 to $677 on average, a 9.7% increase and the days on market dipped to 27 from 41. So the market is extremely strong and there certainly are examples of property values increasing by well more year over year for particular properties than the 9.7% that we're seeing as an average here in the South End.
The inventory is very low. We have a total of 58 properties that, as of July 2013, are available in the South End. And that's across all classes and properties. So that's a decline of more than 30% as far as the levels of inventory. That's one of the factors that's contributing to the strength of the market. Also, of course, interest rates being as low as they have been has been increasing the affordability index for buyers who just effectively have more buying power than they did.
So what's up for the future? Well, we're watching it carefully, we can say that as long as rates remain very low and relatively low, that we're going to see values stay strong. Because, as they always say in real estate, don't fight the Fed.