Boston Condos for Sale and Apartments for Rent
Rising mortgage rates will impact Boston condo sales in 2022
Rates matter when it comes to the Boston condo for sale market in 2022
We gave credit to the ultra-low rates when they were in the 2%-range for helping to spur the Boston condo for sale market. Likewise, higher rates will have something to do with the way the Boston condo market turns out in 2022.
It’s not because the payments are so much different. When the rate changes from 3.0% to 3.85% on a $1,000,000 loan, the payment increases $472 per month.
The higher rates will have a market psychology effect.
We’re not going to get a memo on the day when Boston condo buyers decide that they have had enough.
We know what signs to look for – higher days-on-the-market, declining sales price compared to list price: ratios, and a growing amount of active (unsold) Boston condo listings – to recognize when the market conditions are adjusting, and it’s been quite so far.
Harder to measure is how quickly the Boston condo demand could subside.
With the quality of Boston Back Bay, Beacon Hill, and Boston Seaport condos for sale fetching an average of several offers when listed, then for every sale, there are probably 2-3 losers that are literally priced out or voluntarily quit the race. At that rate, the demand could be cut in half or less within a couple of months.
Boston Condos for Sale in 2022
Add the war in the Ukraine, Boston condo mortgage rates well into the 4s, and Boston condo inventory still low, and you have all the ingredients needed for a slowdown. Because the market is so hyped up, there will be ample overshoot but Boston condos sales are still strong and should last into summer. But everyone knows it won’t last forever.
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