Third-quarter sales are down in the city, apparently, according to a story in yesterday’s Globe.
The data they use, from LINK, is accurate, to a point, but I recommend buyers and sellers rely solely on numbers put out by the Warren Group (including my own numbers!).
While the National Association of Realtors (and the Massachusetts Association of Realtors) puts out its own numbers, drawing its data from the Multiple Listing Service, their data fails to include a lot of developer sales.
LINK, an online database used by many downtown real estate agents, attempts to be inclusive, by researching all data from the local registry of deeds. However, I don’t think their numbers are complete or totally accurate, either.
For example, their data on sales in the third quarter, 2005, and third quarter, 2006, seem to have a lot of gaps. No square footage data on a lot of sales, making it hard to calculate average and median sales, per square foot.
Perhaps LINK has this data, somewhere, and just doesn’t report it, online.
Poking holes in reporters’ stories is my hobby.
They make it so easy!
According to a story in yesterday’s Globe on the slowdown in the Boston real estate market:
While there were volume drops in most downtown neighborhoods, there was a “3.1 percent rise in the emerging Fenway neighborhood.”
“Emerging”, like, Tajikistan, is that what they mean???
Hopefully, they’ll soon have running water and indoor plumbing in the Fenway.
Elsewhere in the same story:
“Quarterly data on a neighborhood can an unreliable indicator of trends because the number of sales in a neighborhood in a single quarter is small.”
Exactly. Meaning, these numbers don’t necessarily prove anything.
The following statement is inaccurate:
In Boston last year, personal incomes increased at a 4.7 percent average annual rate, failing to keep pace with a 9.5 percent housing price increase.
Now, that would be true, if you paid every additional dollar in income toward an increase in your mortgage.
But, you don’t. It’s called leverage.
Suppose you decide to buy the average-priced condo, which the year before would have cost you $400,000, but last year cost you $440,000 (10% increase in price). Your monthly mortgage loan payment (at 6%) would go up from $2,400 to $2,640, a difference of $240.
The mean household income in Boston is $90,000 $73,980. So, based on the data in the article, your salary went up 4.7%, or, $3,400. That’s an extra $280 per month.
Therefore, you’re ahead of the game. Your income went up to $280 per month, but your mortgage loan payment only went up $240.
Let’s go out and celebrate!
Downtown condo prices fall for 2d quarter – By Kimberly Blanton, The Boston Globe