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2011 home prices bounced back in top-tier Boston Metrowest suburbs, where I concentrate my real estate business. Of all the suburbs I follow, only Concord (-11%) showed a significant decline over the past two years. Out of the 14 towns, the only other two towns which showed overall decline were Bedford (-2%) and Waltham (-6%)
Overall it’s safe to say that the combination of excellent schools and easy commutes has helped Metrowest escape the worst of the credit crisis. Weston and Wellesley climbed 15% and 13%, respectively, due to the comeback in the high-end. Average 2011 sales prices in Weston and Wellesley were $1,514,000 and $1,250,000, putting those towns in their own league.
But looking at price changes for the past two years, Lexington performed the best, with average selling prices jumping up 12% in 2010 and 2011 . Weston and Belmont each rose 10% and Wellesley 9%, since the financial crisis bottomed in 2009.
What do these four towns have in common? Excellent school systems, superb access to downtown Boston by car and public transportation, and beautiful homes in many architectural styles. It’s no surprise these are the best performing towns. Newton, Lincoln and Winchester all bounced back nicely, enjoying 7% increases in home values. These seven desirable towns ranked in the “Top 11” MA school districts, as published this fall in Boston Magazine (Belmont was #22).
While the credit crisis and ensuing recession haven’t helped, overall the suburban Boston real estate market is healthy. Foreclosures have been a rarity in Metrowest, and we never had the land to overbuild. With excellent schools, stable industries and the one of world’s smartest workforces, Metrowest remains a healthy and desirable market.
Tight credit continues to be an issue for some buyers. In the past couple years, though, small private banks and other lenders have emerged to help many borrowers who might not have qualified for conventional loans. Interest rates are at or near all time lows, with 30 year mortgages below 4%. In addition, more cash purchases happened in 2011 then I had ever seen. An astounding 30% of home purchases in Massachusetts were all cash during the first 9 months of the year. I believe this is in large part a big endorsement by wealthy investors of the value of Massachusetts real estate and its future.
Why has Lexington proven especially popular with buyers?
Lexington offers a highly educated and diverse community, beautiful homes, a vibrant downtown, and abundant conservation land and walking trails. But Lexington’s main attraction remains unchanged. Ranked as the “Brainest” school district by Boston Magazine last fall, Lexington high school annually sends legions of students to the nation’s top colleges while drawing in new families.
Lexington and the other top-tier international towns continue to draw buyers from overseas. British pounds, Chinese Yuan and Euros from Germany, Sweden and France and Switzerland are pouring into area properties. Life science companies, hospitals and financial services firms are hiring. Venture capital is flowing again, with the promise of further growth of our economy and housing market.
What’s ahead for 2012?
Fears of a “double dip” have eased. While I don’t have a crystal ball, I am very optimistic for modest growth in 2012. Our region continues to enjoy a positive economic climate, and interest rates are expected to stay low. All signs point to our thriving industries staying on tract to continue hiring and expanding.
What does this mean for you?
It’s hard to time the market. The smart thing is to buy and sell when it makes sense for you and your family. I do know that right now inventory is low and demand for well-priced homes is high. Wise sellers capture the early spring market, when the great majority of homebuyers start looking and making offers. Whether you are considering a home purchase or sale, I would love to share my thoughts and experience with you, and it would be my privilege to help you make your next real estate transaction your most successful and least stressful.
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