Looking to buy in Boston this fall? Better get ready for a fight. Residential inventory in the city is increasingly scarce, and buyers are facing pressure to buy in a hurry.
Pointing to recent reports by the Federal Reserve, Michael DiMella, a managing partner at Charlesgate Realty, says, “We’re in the midst of a very active market. There’s certainly an overwhelming demand. Buyers are now expecting interest rates to rise, so that may be putting more pressure on them to act now.”
RE/MAX realtor Candice Macoul agrees. “We’re going to continue with high demand and low inventory. We’ll keep seeing bidding wars and properties going for well over asking price.”
Both agree that there hasn’t been any huge change in the market since last year, but demand in certain neighborhoods is on the rise. “There is much more activity in East Boston and neighborhoods like Brighton that were not necessarily as hot last year,” Macoul says.
DiMella also mentioned Brighton as an emerging market. “Brighton is extremely strong right now. For the high end, the Seaport is strong and we’re seeing a lot of new projects there. We’re also seeing South Boston, which has been growing rapidly for the past few years, but Brighton has been a really strong market for the city.”
What is fueling the Brighton market? “There’s a lot of development in the for-rent area, and in industry too, with businesses like New Balance and Harvard University. It’s a really exciting market from my perspective,” says DiMella.
He cites Brighton as a solid “mid-market opportunity” for buyers who can’t afford the steep downtown prices, while mentioning the Millennium Tower and Four Seasons as high-end condos options.
“We’re starting to see some more inventory on the for-sale side of the condo market. That’s definitely something I see going forward to add a little bit more inventory, but certainly nowhere near enough to meet the demand out there.”
The surplus of buyers is keeping the rental market competitive as well. Macoul mentioned the scramble to buy is causing would-be buyers to continue renting. “We have a lot more buyers with very few properties. Therefore, they have to rent.”
“It is definitely a seller’s market,” she concludes.
But what about all those new buildings popping up? Macoul says they haven’t had as much effect as you might expect. “I certainly expected it to have impacted the market,” she says. “There are so many apartments and at their prices, it surprised me that they are renting as well as they are. Now it is helping the small investor. Existing properties have had to up their game to compete with the new buildings. They’ve had to improve in Charlestown, Beacon Hill, update kitchens and baths, to compete. They’ve had to add value and make them far more competitive with these other buildings.”