With the bidding wars, long lines for open houses and skyrocketing real estate prices, the COVID-19 pandemic has been a time unlike any other in the Boston housing market.
Buyers and sellers are both asking: When is the right time to get into the market?
Experts say the market is cooling and homes are no longer going for well above the asking price, but they say it remains highly competitive.
The median price for homes in Massachusetts recently crossed $500,000, but Warren Group CEO Tim Warren says the red-hot market is cooling. He said the latest numbers for August show a 6% decline in the number of sales for the second consecutive month.
“I sense a little bit of a change in the wind,” he said.
It does not mean prices will fall, but he does think it’s the end of the rapid price increases caused by overwhelming demand.
Still, there are not many homes being listed for sale, so making an offer that stands out is key. Here are a few tips:
- Be flexible on the closing date
- Consider using a local bank for financing, which could make some sellers more comfortable
- Have your pre-approval letter showcase your maximum loan amount
- Mostly gone are people who are willing to waive inspections, but consider covering the cost of repairing any issues found up to a certain amount.
On that last point, however, keep in mind that contractors are also overwhelmingly busy.
“For us, we actually closed our schedule about a month and a half ago because we’re actually booked through 2023,” said Dave Howe, of Howe Development Corp., whose business is split between renovation and new construction.
Howe is currently building a neighborhood of three homes. In addition to scheduling, he says it’s a challenge to nail down pricing for materials.
“I’ve actually priced three times most recently yesterday the lumber costs for each one of these homes. And they’ve changed dramatically, by six figures actually,” he said.
So, how do you get a contractor to call you back for your project?
“That’s a tough question. I think it depends on the contractor,” Howe said.
- Some contractors say they’re more likely to take bigger jobs
- Be prepared to wait, many say they’re booked for more than a year
- Ask friends and neighbors for a personal recommendation
- Don’t cut corners to get someone quickly and check with the state to confirm your contractors are licensed for the job