Should I wait till 2022 to buy a downtown Boston condo?
- Prospective downtown Boston condominium homebuyers will face low supply and high prices for at least another year.
- The US doesn’t have enough homes to meet demand, and builders are struggling to keep up.
- Economists see price growth cooling in 2022, but only if construction picks up and demand holds steady.
The Boston real estate is still in a seller’s market when it comes to housing, and could stay there until next year.
Prices are climbing at the fastest pace in more than three decades, and homes are frequently selling above their list price, according to the National Association of Realtors. In May, the average listing was only on the market for 17 days, said Logan Mohtashami, lead analyst at Housing Wire. For it to become a buyer’s market, “For Sale” signs need to stay up for at least 30 days, Mohtashami said.
Unless construction picks up, the near-term outlook for prices isn’t promising.
Economists interviewed by Insider said price growth will remain elevated through the rest of the year and into 2022 because millennials will keep demand high – and they see the construction industry having a hard time keeping up.
Millennials are hitting peak homebuying age
In his best-case scenario, Mohtashami sees price growth cooling and supply bouncing back in 2022. But demographics complicate the outlook and could keep demand high. The surge of first-time buyers is going to be “historic,” Mohtashami said.
However, if millennial demand falls short, it could be a sign of an even larger issue. The generation’s homebuying prospects were already hammered by the Great Recession, Insider’s Hillary Hoffower reported. With the pandemic sending prices through the roof, the generation could become trapped in a vicious cycle of only renting and never having a home of their own.