The Warren Group recently released a report showing that the Massachusetts housing market grew rapidly in July. Over 7,000 single family homes were sold, which is the highest figure in over ten years. The results corroborate a trend in a recent report from the National Association of Realtors that we covered.
The recovery gained traction earlier this year. Back in February, the Worcester Business Journal published a post discussing the ongoing housing recovery, which began several months early. The Massachusetts housing market is clearly growing, which means that demand for housing stocks in Shrewsbury could rise in the coming months as well.
Housing sales have coincided with modest price increases. Some experts worried that rising prices would deter many consumers from purchasing new homes, but the newest reports suggest those fears were unfounded. The only factor that is likely to affect housing sales is the reduction in housing stocks.
Housing Reports Indicate Strong Growth
Experts from both the NAR and Warren Group have established that the housing market is rebounding from the economic downturn that ended five years ago. Sales volume is likely to continue to rise as the economy gains further momentum.
The strengthening job market has been one of the leading factors behind the housing recovery. Data from the Bureau of Labor Statistics shows that the state unemployment rate dropped to 4.7% in April, which is significantly better than the national average. The demand for housing should continue to rise as employment improves.
Price Increases Won’t Destabilize Housing Growth
Housing prices were rising more rapidly earlier this year, which prompted fears that demand could decline. However, prices this summer were more anemic, especially compared to the sharp increase in pending home sales. The NAR data shows that the median price of Massachusetts single family homes rose 1.4% in July. Condominium prices increased 5.1% during the same timeframe.
Housing prices are clearly rising, but not in line with expectations considering the rapid growth in demand. The market will probably remain hot for the coming months unless prices rise far more rapidly.
Corinne Fitzgerald, President of the Massachusetts Association of Realtors, is confident that the recovery will be sustainable as long as affordable financing is available. “Buyers still want to buy homes in Massachusetts despite the low number of homes available. It’s this demand that has increased REALTOR® confidence this month. Buyer activity should stay strong as demand exceeds supply and interest rates remain low.”