State of the Market - Suffolk County (Boston) MA

9 Replies

The Q4 2017 numbers are out and they confirm what a lot of us already knew.  The Boston market is still a WILD seller's market and there is still a severe shortage of inventory.

If you have a property that you're considering selling, this looks like a GREAT time to do it.

Here are the highlights:

  • Average sales price across all properties is up 23.7% over 1 year ago.
  • The number of homes for sale is down an astonishing 42.2%.
  • The number of "months supply" is a breathtaking 0.9 months. 
    (0-6 months is a seller's market.  6-7 months is at equilibrium, 7 months+ is a buyer's market)
  • Average Days on Market is 41 days, down 6.6%. That's pretty impressive, considering that most lenders need 30-45 days from P&S to close - and DOM is calculated from listing date to close date!

As someone trying to buy in Boston I can confirm this is 100% true. Hoping for more supply in the next few years at least.

Any recommended suburbs for 4 unit homes with a better market?

Thanks

How far out of Boston are you willing to go? There really isn't much 4 unit inventory in general thanks to the popularity of the omni-present triple decker. But you can still find some deals on the North like Lynn, Revere, Everett, Chelsea, and the South Shore like Quincy, Weymouth. You can find deals in places like Haverhill, Chelmsford etc but their rental market isn't as strong.

@Jordan Haran Yep. It's true. The numbers come from MLS.

The problem with 4-plexes is that there are far fewer than 2 and 3-plexes.

The places to look on the South Shore include Plymouth, Brockton, Taunton, Fall River, New Bedford and Attleboro.

There are some decent deals there - if you're patient and willing to react VERY quickly when one hits the market.

Wanted to find something in Dorchester ideally but farther from town is ok. Definitely looking for south side. In no hurry but 4 deckers have been hard to come across just hoping the extra time will pay off. Anyone know if the laws regarding renovation are particularly difficult in Mass? I’m a contractor but not licsenced there yet. 

@Charlie MacPherson Can you elaborate a bit on this towns you mentioned on the South Shore? I’ve seen some crazy cheap multis in New Bedford but don’t know much about the area. From what I understand, it’s pretty rough. I’ve heard the same about Fall River. I see you post on here a lot and you seem very knowledgeable on the South Shore towns. In you’re opinion, is New Bedford or Fall River a good place for buy and hold investing? What types of tenants? Any particular areas “better” (safer) than others? Also, do the other towns you mentioned have strong rental markets? 

Thanks for your contributions to these threads!

@John Strobel I wouldn't say that I'm an expert in the neighborhood details of Fall River and New Bedford.  Trulia has crime "heat maps" that show a couple of hot spots in New Bedford (Fall River looks worse), but otherwise the rest looks decent.  

https://www.trulia.com/real_estate/New_Bedford-Mas...

I drove the New Bedford waterfront a few weeks ago and it looks like things are getting cleaned up nicely, so I'd pay attention to that area.  

It's definitely not a wealthy town, but there are tons of rentals that you can acquire for a lot less than inside the 128 belt.  

Rents are lower too, but I've seem many properties approaching 2% and a couple just exceeding it.

Typical MFRs were built in the late 1800s and early 1900s.  You need a good home inspection to be sure that updates were done to things like old plumbing and knob & tube and new lally columns used to replace old cedar posts that cause floors to sag.

I think there are decent opportunities there, as well as Brockton (west side - not the war zone), Taunton, Midlleboro and Plymouth.  There are a few other south shore towns that are worth keeping an eye on - Marshfield (watch the crime maps there too), Kingston, Pembroke, Whitman, Abington and Holbrook.

@Charlie MacPherson  , thank you for the update. We are in a crazy market right now. How do you think the low inventory is going to affect real estate agents? Do you think the low inventory will force real estate agents out of the business? Maybe brokers will start providing property management services? I would love to hear your opinion.

@Josue Velney The vast majority of real estate agents drop out of the field within 18 months.  Some leave altogether.  Others turn in to "Part-Time Patty" - the agent who does real estate as more of a hobby than a profession.  

Those of us with the fortitude and work ethic to stick it out will still be here for the long haul - many finding niches to work in.

I'm specializing in working with investors - which is why I'm here on BP.  Others may try property management, apartment rentals, vacation rentals, property development or something else.

The other response is that hard working agents will expand their territories.  

In my case, I'll work anywhere from Boston, south to the South Coast and west as far as Worcester.  That's unheard of in a lot of agencies, where agents will limit themselves to one "anchor" town and perhaps the towns that border it.

Charlie, Thanks for sharing! The information provides great insight into the market and I think your observation is spot on. Im a local Boston investor, we should connect!

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