The housing market was very strong in Massachusetts before the pandemic. Homes were selling quickly and with multiple offers. The pandemic hit just as the spring market was starting, which is typically the busiest time of year for the real estate market. Many home buyers and sellers are wondering about the Coronavirus impact on the housing market in Massachusetts. Here’s what we’ve seen so far and what we can expect.
Home Sales and Rea Estate Activity
Business closures and stay-at-home recommendation began in March 2019. During the month of March and April, closings were likely the result of purchase contracts already in place. Therefore, May closings are a better indication of the Coronavirus impact on the housing market in Massachusetts.
During May 2020, 653 properties sold for an average of $732, 225 in Middlesex County. During this same month in 2019, 971 properties sold for an average of $749, 481. Thus, not only were there fewer home closings but properties sold for slightly less than in the past. Marketing time remained steady at 25 days to offer.
County-wide statistics don’t often reflect variances in individual markets, so let’s take a look at a smaller geographic area. In Arlington, MA, 14 properties sold in the month of May. This is lower than the 28 that sold in May 2019. Homes took a little longer to sell with an average of 42 days to offer, up from last year’s average of 10 days. However, average selling prices were actually higher this year at $994,128 (compared to $975,961 last May).
Short-term and Long-term Coronavirus Impact on the Real Estate Market in Massachusetts
Industry experts have been predicting that Coronavirus won’t have a negative long-term impact on the real estate market. Instead, many see the last few months as a “pause” as many buyers and sellers put their plans on hold. As restrictions ease, real estate activity should return to normal. Additionally, pent up demand may cause a flurry of activity.
Although data from March through June of 2020 can help us understand the Coronavirus impact on the real estate market in Massachusetts, it’s important to remember that those adjustment may be temporary. They are not necessarily indicative of what will happen over the next 3, 6 or even 12 months. Ultimately, sellers still need to sell and buyers still need to buy. Precautions will remain in place for health reasons, but activity will change as jobs return, businesses re-open, and real estate activity returns to normal.