Heading into the spring, the real estate market is beginning to boom again, as the weather warms up and people are looking to get a fresh start. The buyer demand is growing, but the inventory can’t seem to keep up, according to real estate professionals.
The Gazette spoke with three Jamaica Plain area real estate professionals to get a sense of the market in the neighborhood right now as well as some trends that they’ve seen over the past year.
“I think that buyers right now are grabbing whatever they perceive as anything they can get because there’s a lack of supply as usual,” said Faye Simon, owner of Faye Simon Real Estate.
“I just think that with the lack of supply, people who want to start families, they’re getting married, they want to buy a house, it’s just pushing it further and further up the mountain of price.”
She said that she believes this trend will continue, as people are looking for larger homes and starter homes, until more supply is built.
On the rental front, “large apartments have emptied out,” she said. She said that prices have come down on many rental apartments.
“If you’re a reasonable landlord and you can adjust the prices, you’re doing good,” she said.
Simon said that within “within the last 10 days,” the rental market “went poof,” as many leases in Boston are either for June or September and people are beginning to look for places.
“There’s cycles of downturn that will then change and become a cycle of upturn,” Simon said. “We’re in an upturn cycle right now; everyone’s getting vaccinated hopefully.”
She said that shifts in living arrangements between roommates during the pandemic has slightly changed what people are looking for. She said that those who had lived with roommates in a three or four bedroom unit are now looking for a two bedroom unit instead so they only have to live with one other person.
This “opens up all these larger apartments,” she said, but the demand is now picking up again.
She said that sales have stayed relatively the same “because there’s no supply.” Simon said that “if you flood the market with supply, the prices will go down.”
Karen McCormack, a co-owner and broker at McCormack and Scanlon Real Estate, said that at the beginning of the pandemic, many people were “nervous” about moving and the prospect of looking for a new house, but a lot of them realized they needed more space as they worked from home and their kids learned remotely.
“People started moving and then the beginning of the year came around,” McCormack said, but the “inventory never picked up. More buyers came into the marketplace” who were looking for more space, and others who were looking to downsize. She said that people put single family homes on the market, many of which received multiple offers.
“There are a lot of people I know that their spaces aren’t necessarily working for them,” McCormack said. “A lot of my clients want to stay close.”
McCormack also talked about all of the new construction happening in JP, particularly on Washington St. that has created new housing units. She said that it has leveled the rental prices slightly, but “has not affected the sales market at all.”
She also said that many buyers are willing to pay more than they should to secure a home. She said with interest rates as low as they are right now, “new buyers would feel better about taking a mortgage out even if they’re paying a little over market value.”
She added that in JP specifically, “I think we have so much going for us with green space, colleges, being so close to the scientific world, that “even if there’s a bit of shift or leveling, I don’t think JP will see any great depreciation in the short term.”
She said that much of the inventory in JP consists of condos, but she mentioned a single family home that just recently came on the market for more than a $1 million with no parking.
“From a historic perspective, the prices and price per square foot are higher” than they’ve been, she said.
She said that people are willing to pay more than a house is worth because they don’t want to lose a home that they see as valuable. She said that because of this, in a way, multiple offers lead to buyers driving the market and deciding what they feel a property is worth.
Shifting into the spring season, this time of year is always busier for the real estate market, and this year seems to be no exception, despite the ongoing pandemic.
“I think the biggest difference between now and six months ago,” said Randal Engelmann, an owner and agent at FOCUS Real Estate, is that the “fall market is always a lot less vibrant than the spring season.”
He said that while FOCUS Real Estate still takes COVID very seriously and still takes all the proper precautions, life has started to feel more normal as people are fairly accustomed at this point to doing things like wearing masks, staying distant from others, and sanitizing their hands.
“The people that are least comfortable are not going to open houses nor are they selling their homes,” he said. But during open houses, they are only allowing a certain number of people in at a time, adding that “people are pretty cautious and also patient and respectful to one another in regards to the pandemic.”
Engelmann, too, made note of the low inventory for home buyers in the JP area, and the fact that there is a “huge buyer demand.”
He said that while people are moving all across the country because they are able to work remotely, there are still many people who are moving around the city into larger homes. He said that single family homes are “getting absorbed the fastest.”
Engelmann said that with people trying to flee their homes for larger ones, “that would always beg the question: what happens to the houses they’re leaving behind?”
He said that the large population of baby boomers are now “gainfully employed” in careers in the tech industry, as doctors, as lawyers, and other high paying jobs, so “they are absorbing the two bed, one bath properties that are the bread and butter of the marketplace.”
Engelmann said he didn’t “think the market would slow down in the fall,” but it has definitely “snapped back with such fervor.”
He said that there are between five and 15 offers on every property that has come on the market, and these offers are “significantly over the asking price.”
He also said that what drives the rental market in JP this time of year is doctors who are here for their residencies in the Longwood Medical Area.
Engelmann added that “in my opinion, the spring market is all about new beginnings and it’s about hopefulness for the future.”
He said the fall market is “dark and cold” and there’s the “impending doom of winter. People are very pessimistic in the fall season and the winter season. The market isn’t very vibrant.”
Engelmann also said that when it comes to what people are looking for in a home, there has been a trend towards wanting move-in ready. He said that because of COVID, it has become harder to have people in and out of your house doing renovation work with people working from home and kids learning from home.
“People don’t really want to do those kinds of things.”
He also said that people in JP are looking for access to outdoor space, whether it be a deck or a yard.
As for looking towards the near future, all three said they think that the market will remain about the same as the city returns to some more normalcy as more vaccines roll out.
“I think everything is gong to improve,” Simon said.