Region’s Real Estate Market Suffers from Lack of Inventory

December 2, 2010 – BOSTON:  Amid the recent stories of a slow recovery in the nation’s real estate market, Boston area real estate agents are battling with a different challenge – a lack of inventory. They have an active pool of qualified buyers – but not enough homes for them to buy.

“We are used to being ahead of the curve,” said Michael Hansen, Owner of Gibson Sotheby’s International Realty. “Boston tends to recover from economic dips before most of the country. That is what we are seeing now.”

In the last six months, Boston has seen a lot of movement at the higher end of the market. Experts attribute that to “smart money” re-entering the market. (Smart money is the term used to describe the more affluent and savvy investors.) That movement in the higher price points has been followed by improving home sales at other price ranges. And, with all that activity, the supply has dwindled.  “We have a lack of inventory,” said Nick Russo, a veteran real estate broker of more than 30 years. “I have clients who are ready to buy in the South End, but there aren’t enough units out there.”

“I have been working with clients searching in the Back Bay for a $2.5 million home,” notes real estate agent, James Plasteras. “It has been a challenge to get a pool of homes that work for them. And I am seeing that at other price points, as well.”

Karl Case, of the Case-Shiller Home Price Index, shared his predictions at a lecture in Boston this week. “I don’t think we’ll have a double-dip,” said Case. His prediction is for a continued recovery in the market, with the northeast coming out of the recession ahead of the rest of the country.

“What we need now are listings,” said Hansen. “If anyone has been considering selling their home, now appears to be the time to get it on the market, because there are definitely buyers who are ready to move.”

Boston Luxury homes selling WAY over last year’s mark

Boston’s luxury real estate market appears to be selling far more than last year. Gibson Sotheby’s sold 40 $1 million+ properties so far this year – as opposed to 21 for the same period last year. Beth Dickerson’s sale on Commonwealth Avenue in Boston’s Back Bay – for over $10 million - is the most expensive home sold in the state so far this year (source: MLSpin).

For more information on Boston real estate sales, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Boston Real Estate Firm Sees Upward Mobility

Gibson Sotheby’s International Realty is finding conventional successes in unconventional ways

BOSTON: Only a few weeks into the spring market, one Boston real estate firm is seeing tremendous success. Gibson Sotheby’s International Realty recorded 80 Under Agreements and over 100 sales transactions in January and February (source: MLS). The firm is ranked #5 in the state and has the #1 office in Boston’s Back Bay for 2010 sales-to-date. But their recent success is not just measured in sales figures. The firm has made some strategic moves over the last few years, making them the top-ranked Boston-based firm in the state. They expanded with office acquisitions in the Waterfront, Charlestown and Westwood areas. They also invested in the firm’s infrastructure, including additional marketing and relocation services for their clientele. “We saw the importance of offering the finest services to each client,” says Michael Hansen, President and Co-Owner. “We knew our clients would appreciate the special efforts we now provide.”

All the improvements have attracted highly successful sales associates. Once again, Gibson Sotheby’s recognized Beth Dickerson as their top agent in 2009, having sold the highest volume of sales. Dickerson’s average sale price was more than $3 million last year and she recorded the most expensive sale in Boston, a condominium on Beacon Street in the Back Bay that sold for $9.25 million. Co-Owner, Paul McGann, meets regularly with agents who are considering the firm. “Most often, agents who join us are already successful – but they are looking to go to the next level; to grow their business.” It is that growth potential that brought agents like Tammy DeWolfe to the company. After years in the business, she joined Gibson Sotheby’s Westwood office last month, citing the company’s support as a major motivating factor.

CEO and Co-Owner, Larry Rideout, continues to look for new ways to offer service to an expanding clientele. This month, the company launched a text-to-MLS service offered by Kwkly. This allows home buyers to text the address of any property for sale to get MLS information in seconds. They also have added an iPhone application and a GPS-based search function. “The percentage of Gen X and Gen Y home buyers is growing and they want immediate access to information,” says Rideout. “Our goal is to continue to find new ways to provide exceptional service.”

Back Bay real estate: Boston penthouse with private deck

This gorgeous penthouse two bedroom duplex in Boston’s Back Bay features a private deck with stunning city skyline views. Sun-filled open living room with cathedral ceilings, renovated gourmet cook’s kitchen with breakfast bar, separate dining area, and glass doors leading to a private deck. Spacious master bedroom with two closets, second bedroom perfect for office/guest room combined. One and a half marble baths, pristine hardwood floors, fantastic storage and closet space throughout, central air conditioning, elevator, and parking included.

To see more details about this home, go toBoston Back Bay penthouse at Gibson Sotheby's International Realty, your real estate experts.

For more information on Boston Back Bay real estate sales, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Boston luxury home featured on the Wall Street Journal website

One of our fabulous Boston luxury homes, currently offered for sale, is being featured as the House of the Day on the WSJ.com site.

Click here to see more details on this fabulous Boston property.

For more information on Boston luxury homes, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Spotlight on Boston real estate: Jumbo Mortgages on the Rise

An article on Boston Business Journal’s website investigated a rise in what they are calling “mega-mortgages” - those over $1 million. The jumbo loan market appears to have been doing well, despite the more strict financing guidelines of late. The Journal sited the Boston-based wealth management division of the Bank of New York Mellon as a firm who is leading the charge. The firm tends to deal with the wealthiest 1%.

To read the complete article, go to BizJournals.com.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Spotlight on Boston real estate: Hancock Tower is sold

The New England Real Estate Journal has reported that the Hancock Tower was bought at auction by a partnership between Normandy Real Estate Partners and Five Mile Capital Partners, which have been buying some of the debt on the building since June. There was only one bid at the auction for the iconic building, originally designed by I. M. Pei.

Read the complete story on NEREJ.org.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Boston’s Back Bay is named in the top ten dreamiest neighborhoods

Frontdoor.com, powered by HGTV, put out a list of ten dreamy neighborhoods in the United States. Boston’s own Back Bay was ranked number ten for its combination of Victorian brownstones, skyscrapers, cafes and 19th century landmarks.

View the complete article on marketwatch.com.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Spotlight on Boston real estate: Back Bay

Julie Harrison of Gibson Sotheby’s International Realty has listed a wonderful Beacon Street condominium with Charles River views! This two bedroom floor through home features a gorgeous living room with original moldings throughout and separate dining alcove. Direct elevator access leads to an elegant formal foyer with floor to ceiling built-in's. There is a beautifully renovated kitchen, two full luxury baths, master bedroom suite with a walk-in closet, and a spacious and sunny second bedroom. Also has elegant common areas and a direct access deeded single parking space.

View the complete property description on SothebysRealty.com.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Boston luxury real estate expert comments on recent market activity

There has been a lot of recent market activity at several price points. The most recent edition of Distinctive Homes quoted Gibson Sotheby’s International Realty agent, Beth Dickerson regarding the higher price points. “The high end market is very active and there is a flurry of activity from interested buyers in the over $2 million range.”

View Distinctive Properties online at Nxtbook.com

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

What does $500,000 buy in other U.S. markets?

A recent article on Business Week’s Website indicates that New York, San Francisco and Boston have sustained their home values through these challenging economic times. The rest of the nation is facing drops in real estate values.

The article also offered insight into what $500,000 can buy in different home markets around the country. Our city was represented by a property on Commonwealth Avenue, marketed by Julie Harrison of Gibson Sotheby’s International Realty. This lovely home can be viewed as an MLS listing.

Source: BusinessWeek.com and MLSpin

The Changing Face of South Boston

Once known for being an insular community of born-and-raised Southie residents, South Boston has changed. The demographic landscape now includes a growing number of young professionals, looking for proximity to downtown and more favorable pricing than the South End. Renovated condominiums in multi-family buildings offer larger space with lots of character.

Don Minchello, a South Boston Specialist at Gibson Sotheby’s International Realty, has seen buyers coming in from New York, New Hampshire, Illinois and Pennsylvania in recent months. “South Boston is a great community and many of the people who eventually buy here start their search in other parts of Boston – the South End, Back Bay and even Cambridge. Their dollars buy larger homes than in those other neighborhoods. South Boston is still an excellent value.”

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

The Red Sox aren’t the only winners in the Fenway

A recent market study suggests that Boston’s Fenway neighborhood is showing market momentum, with a whopping 12.3% increase in average sales price to $359,156. A meager 2.71 month supply of inventory, even lower than the South End, is driving favorable prices for homeowners within that area. The average days on market are a shocking 86 – by comparison, the South End is performing well at 122!

The Fenway neighborhood, most well-known for being the home of the Boston Red Sox, is also the location of the Museum of Fine Art, the Isabella Stewart Gardner Museum, as well as several notable universities and colleges.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Source: MLS.

Boston’s hot neighborhoods still going strong

A study on the housing inventory in the neighborhoods in and around Boston is showing an overall reduction in inventory and some increases in median and average sale prices. The big winners were the South End and Back Bay. Along with the South End’s 3.21 month supply and the Back Bay’s 5.77 month supply, each area has also enjoyed an increase in average sale price. The South End increased 5.4% to $642,969 and Back Bay jumped 7.6% to $932,316.

Source: MLS.

For more information on the Boston real estate market, go to Gibson Sotheby's International Realty, Boston's real estate experts.

Big Dig Ends, New Hope Begins

A recent New York Times article proposes that the completion of the Big Dig will encourage more people to move to Boston. With the old green central artery gone and new green space in its wake, there is renewed interest in coming back to the city.

We've seen a number of Baby Boomers move to Boston from the burbs in the last five to ten years. With the spring market in full swing and the interest rates at a remarkable low, buyers are showing up to open houses in droves.

http://www.nytimes.com/2008/02/24/us/24dig.html?_r=1&hp&oref=slogin

No Savings in FSBOs

The December 24^th edition of Banker and Tradesman features an interesting page-one article on the FSBO market. The percentage of For Sale By Owner properties in Massachusetts has remained steady over the last 2-3 years. That might be surprising given the growing number of companies that offer limited marketing for FSBOs and the amount of shared information online.

The Massachusetts Association of Realtors believes it’s found the “fly in the ointment.” Though homeowners save on the typical 5-7% commission, there is a dramatic difference in sales price: in a MAR 2006 survey, the median sale price for FSBOs was $312,000, compared to agent-assisted sales at $385,000. The math shows a net gain for homeowner’s using agents:

$385,000 – median agent-assisted sale

- $19,250 – agent commission (5%)

$365,750

After the commission is paid, the agent-assisted homeowner got $53,750 more than the median FSBO sale!

What are the reasons for the discrepancy? The Banker and Tradesman article points to a number of tools that agents have: greater marketing exposure, proper pricing, expertise in negotiations and proper disclosures. The article also sites that these tools are more important in a market such as this.

Source: http://www.bankerandtradesman.com/pub/5_316/residential/198256-1.html

For more information, email us at gibsonSIR@sothebysrealty.com or visit our website at http://www.gibsonsothebysrealty.com/ .

Contrary to News Reports, Boston Luxury Market Remains Strong

By Larry Rideout

Recent news articles are celebrating Boston’s thriving luxury real estate market (“Hub’s Condo Market Enjoys Life of Luxury” in Banker and Tradesman and “Finding a windfall in their walls” in the Boston Globe). This may seem inconsistent with the “Chicken Little” syndrome in the media for the last 18 months. You might wonder how the sky could be falling while the luxury market is booming. There are a few reasons for this phenomenon:

1. The sky isn’t falling… in Boston – While much of the nation has seen a major market correction, Boston has remained strong. My real estate colleagues in beleaguered markets like Las Vegas and Miami have battled falling prices and rising inventory levels. By contrast, Boston and Manhattan have experienced a relatively small correction. For the months of January-October, there was a 27% increase over 2006 in homes sold for $1 million or more. There was a 17% increase in homes sold at all price points. (Source: Boston’s MLS for Back Bay, Bay Village, Beacon Hill, Leather District, Midtown, North End, South End, Waterfront).

2. Boston was less affected by the recent drama in the mortgage industry – The national media rallied around horror stories of 13% mortgage interest rates and a shocking increase in foreclosures. However, the most dramatic hikes and salacious stories took place in California; a state that has been historically less stable than the New England states.

3. The luxury buyer is unaffected by recent changes in the mortgage industry – Many luxury buyers do not utilize loans to purchase homes. Some are cash buyers or are utilizing the 1031 exchange process.

4. The falling dollar makes this market more attractive to foreign investors – One UK pound buys $2 and one Euro buys $1.50. This means a higher value of investment for foreign buyers. Local real estate companies with global ties are seeing a rise in the number of international buyers for properties in major metro markets, like Boston.

The good news for Boston homeowners is that our properties continue to be desirable to buyers and investors, alike. Invest in Boston with confidence – after all, the city has earned it!

_________

Larry Rideout is the CEO and Owner of Gibson Sotheby’s International Realty in Boston. Mr. Rideout has more than 20 years of experience in real estate, including 15 years with the nation’s largest real estate firm, as Senior Vice President of Realogy. Contact him at Larry.Rideout@SothebysRealty.com or his website http://www.gibsonsothebysrealty.com/ .