Suburban Boston home prices cheaper than city’s
Aug 2011 22

HSH.com, an online mortgage loan tracking company, released the results of an analysis of home prices and has determined that living outside major US cities can save homeowners thousands of dollars in interest on their loans, mostly due to lower home prices in the suburbs. This is true in Boston, where living outside the city, and as far away as New Hampshire, can save homebuyers money, while still giving them access to many of the city’s amenities.

HSH.com evaluated four factors: taxes, mortgage payments, average academic performance of eighth-grade students and general (non-housing) cost of living. These data points were combined into an overall Cost and Quality Score.

The results should surprise no one. Boston, like most major US cities, offers expensive housing options (at least in in its city core). While our property taxes aren’t high compared to the suburbs, our public schools are known to be mediocre (although some individual schools meet and exceed the quality of education in some suburbs).

But, people move into Boston for reasons beyond the cost of housing or the quality of schools. Many people don’t want long commutes, want to be in the center of activity, and want the urban experience, all its pluses and minuses.

Plus, if you were to take HSH’s advice … then you’d be living in NH. Blecch.

Back Bay Open Houses for Sunday August 21, 2011
Aug 2011 19

A complete list of all single-family and condominium homes with open houses scheduled for Sunday, August 21, 2011 in the Back Bay neighborhood of Boston.

Please contact me for complete details on these listings and for private showings.

MLS # Address Description List Price Time/Date
71235369 62 Commonwealth Ave U:1 2 room, 0 bed, 1 bath Townhouse $249,900 Aug 21 11:30 AM to 1:00 PM
71092723 163 Beacon St U:B1 3 room, 1 bed, 1 bath Brownstone $275,000 Aug 21 11:00 AM to 12:00 PM
71229205 566 Commonwealth Avenue U:1105 3 room, 1 bed, 1 bath Hi-Rise $289,000 Aug 21 12:00 PM to 1:00 PM
71226832 8 Garrison St U:100 2 room, 1 bed, 1 bath Mid-Rise $299,000 Aug 21 12:00 PM to 1:30 PM
71203399 393 Marlborough St U:2 2 room, 0 bed, 1 bath Brownstone $305,000 Aug 21 12:00 PM to 1:30 PM
71228393 362 Commonwealth Ave. U:3C 3 room, 1 bed, 1 bath Mid-Rise $346,000 Aug 21 1:00 PM to 2:30 PM
71227573 80 Marlborough Street U:7 2 room, 0 bed, 1 bath Brownstone $357,500 Aug 21 1:00 PM to 2:30 PM
71251721 511 Beacon street U:13 3 room, 1 bed, 1 bath Mid-Rise $364,900 Aug 21 2:00 PM to 3:00 PM
71119241 259 Beacon U:32 3 room, 1 bed, 1 bath Low-Rise $399,900 Aug 21 12:00 PM to 1:30 PM
71226873 280 Beacon St U:2 5 room, 1 bed, 1 bath Mid-Rise $449,000 Aug 21 11:30 AM to 1:00 PM
71274023 464-466 Commonwealth Ave. U:PH91 3 room, 1 bed, 1 bath Mid-Rise $469,000 Aug 21 2:00 PM to 3:00 PM
71248963 416 Marlborough St. U:202 3 room, 1 bed, 1 bath Mid-Rise $489,900 Aug 21 11:00 AM to 12:00 PM
71268983 381 Marlborough St U:1 3 room, 1 bed, 1 bath Brownstone $499,000 Aug 21 1:00 PM to 2:00 PM
71268983 381 Marlborough St U:1 3 room, 1 bed, 1 bath Brownstone $499,000 Aug 21 1:00 PM to 2:00 PM
71215457 146 Marlborough Street U:7 3 room, 1 bed, 1 bath Brownstone $499,999 Aug 21 11:30 AM to 12:30 PM
71241126 416 Marlborough U:505 3 room, 1 bed, 1 bath Mid-Rise $515,000 Aug 21 12:00 PM to 1:00 PM
71230491 133 Marlborough St U:10 3 room, 1 bed, 1 bath Mid-Rise $529,900 Aug 21 12:30 PM to 2:30 PM
71240924 33 Bay State Road U:5 4 room, 2 bed, 1 bath Brownstone $569,000 Aug 21 11:00 AM to 1:00 PM
71276080 313 Marlborough Street U:1 3 room, 1 bed, 1 bath Brownstone $599,000 Aug 21 1:00 PM to 2:00 PM
71206431 416 Marlborough St U:702 4 room, 2 bed, 2 bath Mid-Rise $659,000 Aug 21 12:00 PM to 3:00 PM
71255222 416 Marlborough U:501 4 room, 2 bed, 2 bath Mid-Rise $669,000 Aug 21 12:00 PM to 1:00 PM
71260943 416 Marlborough St. U:507 4 room, 2 bed, 2 bath Mid-Rise $689,000 Aug 21 12:00 PM to 1:00 PM
71260943 416 Marlborough St. U:507 4 room, 2 bed, 2 bath Mid-Rise $689,000 Aug 21 12:00 PM to 1:00 PM
71240613 23 Bay State Rd U:7 4 room, 2 bed, 2 bath Mid-Rise $699,000 Aug 21 11:30 AM to 12:30 PM
71264529 80 Marlborough Street U:8 3 room, 1 bed, 1 bath Rowhouse $725,000 Aug 21 2:00 PM to 3:00 PM
71231315 382 Commonwealth Avenue U:61 5 room, 2 bed, 2 bath Rowhouse $824,900 Aug 21 12:00 PM to 1:00 PM
71274483 24 Marlborough Street U:5 4 room, 2 bed, 1.5 bath Mid-Rise $849,000 Aug 21 1:30 PM to 3:30 PM
70997544 285 Columbus Avenue U:208 4 room, 2 bed, 2 bath Mid-Rise $874,000 Aug 21 1:30 PM to 2:30 PM
71246875 285 Beacon Street U:3A 6 room, 3 bed, 2 bath Rowhouse $1,024,000 Aug 21 1:30 PM to 2:30 PM
71249234 295-297 Beacon St U:2 7 room, 3 bed, 2.5 bath Mid-Rise $1,099,000 Aug 21 1:00 PM to 2:00 PM
71274928 166 Beacon U:2 5 room, 2 bed, 2 bath Brownstone $1,200,000 Aug 21 12:00 PM to 1:30 PM
71245954 17 Gloucester St U:9 5 room, 2 bed, 2 bath Brownstone $1,299,000 Aug 21 12:00 PM to 1:30 PM

Above, 62 Commonwealth Ave #1, Back Bay, Boston, Massachusetts. Cathy Marotta of Gibson Sotheby’s International Realty is the listing agent.

691 Massachusetts Ave South End condos begin closings
Aug 2011 19

The brand-new 691 Massachusetts Ave condo project is complete and closings have begun.

The 40-unit, low-rise development filled in a long-empty lot located on one of the South End’s most historic boulevards.

Condos are priced from the low-to-mid $300,000′s and up. A one-bedroom, one-bathroom, ~608-square foot condo on the 4th floor sold for $343,000. A fifth floor, ~637-square foot home sold for $409,000, and included one parking space.

Thirteen units remain listed for sale in our local MLS with prices from $330,000 to $450,000 with some penthouse units in the low-$500,000′s.

Please contact me for private showings.

Proposal would lower mortgage rates to 4% for millions of homeowners
Aug 2011 18

Finally, something we can all agree on? :)

According to Scott Van Voorhis over at Boston.com, two Columbia Business School professors have a bold proposal for fixing the nation’s housing market problem and the US economy.

R. Glenn Hubbard, dean of the Columbia Business School, and Chris Mayer, a professor of finance and economics and the school’s senior vice dean, would like to refinance 30 million mortgages across the country down to a once unimaginable 4 percent.

Whoa.

You can only see their proposal as a theoretical one; there’s no way that this could come to pass. And, they’re not the first to come up with the idea. (Even I was talking about this exact thing, last weekend!)

There are great benefits to doing this. Mr. Van Voohris says the professors estimate it would free up $60 billion in cash that consumers would (hopefully) spend.

But, even if the majority put the difference in savings into savings, isn’t that a good thing?

The program would reward responsible owners, for once, so it would be mostly met with approval from the American public – and what politician could be against that??

Bond holders have always recognized that there is a risk that their loans will be called. That’s all that would happen here. The loans would be redeemed and replaced with loans at lower rates. Since no one’s done a complete analysis on this, it’s hard to know who this would affect and how.

(The US Government should be redeeming and reissuing all its long-term treasury debt anyway, btw.)

I don’t necessarily agree that housing in Greater Boston is “over-valued”; as a percentage of household income, taking out a $400k loan this year would cost you less than any time since at least 1990.

I agree; picking “losers” and “winners” shouldn’t be the job of the government. The free-market should decide.

People’s opinions on this idea probably vary based on whether or not they stand to gain.

Free condo fees program offered through Freddie Mac
Aug 2011 16

Freddie Mac, which holds the keys to hundreds of thousands of homes that have been lost to foreclosure, has announced a new program that may entice people in the market for a new home to make offers.

HomeSteps, the real estate sales unit of Freddie Mac, today announced “Condo Cash”, a special limited time offer that will provide eligible condominium buyers with up to $1,500 for standard condominium association dues.

HomeSteps’ Condo Cash is limited to buyers who submit offers between August 15 and November 15, 2011 and close escrows on or before December 30, 2011. HomeSteps’ Condo Cash offer is valid only on HomeSteps homes that have been on the market for at least 120 days and are sold to owner-occupant buyers.

A two-year Home Protect® limited home warranty that covers electrical, plumbing, air conditioning, heating and other major systems and appliances is offered on some eligible HomeSteps homes. Home Protect also provides discounts of up to 30 percent on the purchase of appliances.

For complete terms and conditions, visit www.homesteps.com.

Back Bay Open Houses for Sunday August 14 2011
Aug 2011 12

A complete list of all open houses scheduled for the weekend of August 14, 2011 in the Back Bay neighborhood of Boston.

Please contact me for complete details and to set up private showings.

MLS # Address Description List Price Time/Date
71216431 367 Beacon St 12 room, 5 bed, 4.5 bath Victorian $3,950,000 Aug 14 11:30 AM to 1:00 PM
71216285 52 Bay State Road 9 room, 4 bed, 3.5 bath Other (See Remarks) $2,650,000 Aug 14 12:00 PM to 1:00 PM
71071409 1 Exeter Street 12 room, 5 bed, 4 full, 2 half bath Other (See Remarks) $3,599,000 Aug 14 2:30 PM to 3:30 PM
71272169 329 Beacon St U:4 3 room, 1 bed, 1 bath Rowhouse $499,000 Aug 14 12:30 PM to 2:00 PM
71269447 413-415 Commonwealth Ave U:3 6 room, 2 bed, 2.5 bath Brownstone $1,695,000 Aug 14 12:30 PM to 2:00 PM
71266920 427 Marlborough St U:1 3 room, 1 bed, 1 bath Rowhouse $449,900 Aug 14 11:30 AM to 1:30 PM
71260022 145 Saint Botolph St U:G1 4 room, 1 bed, 1 bath Brownstone $539,000 Aug 14 11:30 AM to 1:30 PM
71263917 259 Beacon Street U:42 3 room, 1 bed, 1 bath Mid-Rise $439,000 Aug 14 12:00 PM to 1:30 PM
71262744 56 Commonwealth Ave U:42 1 room, 1 bed, 1 bath Mid-Rise $289,000 Aug 14 11:00 AM to 12:00 PM
71261378 40 Saint Botolph St U:24 4 room, 1 bed, 1 bath Rowhouse $419,000 Aug 14 1:00 PM to 2:00 PM
71257777 415 Beacon Street U:3 3 room, 1 bed, 1 bath Rowhouse $425,000 Aug 14 12:15 PM to 1:15 PM
71251721 511 Beacon street U:13 3 room, 1 bed, 1 bath Mid-Rise $364,900 Aug 13 12:30 PM to 1:30 PM
71251721 511 Beacon street U:13 3 room, 1 bed, 1 bath Mid-Rise $364,900 Aug 14 1:30 PM to 2:30 PM
71249286 271 Dartmouth St U:2K 2 room, 1 bed, 1 bath Mid-Rise $349,000 Aug 14 1:00 PM to 2:00 PM
71246875 285 Beacon Street U:3A 6 room, 3 bed, 2 bath Rowhouse $1,024,000 Aug 14 1:30 PM to 2:30 PM
71239403 413 Beacon Street U:5 4 room, 1 bed, 1 bath Rowhouse $499,000 Aug 14 12:00 PM to 1:00 PM
71241896 298 Marlborough St U:1 4 room, 2 bed, 2 bath Rowhouse $795,000 Aug 14 1:30 PM to 3:00 PM
71241562 68 Marlborough U:B 4 room, 2 bed, 1.5 bath Townhouse $1,095,000 Aug 14 12:00 PM to 1:30 PM
71240613 23 Bay State Rd U:7 4 room, 2 bed, 2 bath Mid-Rise $699,000 Aug 14 1:00 PM to 2:00 PM
71230031 10 Cumberland Street U:4 5 room, 2 bed, 2 bath Brownstone $795,000 Aug 14 12:00 PM to 1:00 PM
71231315 382 Commonwealth Avenue U:61 5 room, 2 bed, 2 bath Rowhouse $824,900 Aug 14 11:30 AM to 12:30 PM
71231376 327 Beacon U:1 4 room, 2 bed, 2.5 bath Townhouse $1,045,000 Aug 14 1:30 PM to 3:00 PM
71230491 133 Marlborough St U:10 3 room, 1 bed, 1 bath Mid-Rise $529,900 Aug 14 12:30 PM to 2:30 PM
71227573 80 Marlborough Street U:7 2 room, 0 bed, 1 bath Brownstone $357,500 Aug 14 1:00 PM to 2:30 PM
71226248 396 Beacon Street U:7 2 room, 1 bed, 1 bath Rowhouse $389,000 Aug 14 12:00 PM to 1:00 PM
71216226 290 Commonwealth Ave U:15 3 room, 1 bed, 1 bath Mid-Rise $489,900 Aug 14 2:00 PM to 3:00 PM
71215457 146 Marlborough Street U:7 3 room, 1 bed, 1 bath Brownstone $499,999 Aug 14 12:00 PM to 1:00 PM
71211897 340 Commonwealth Ave U:3 5 room, 2 bed, 2 bath Rowhouse $895,000 Aug 14 12:00 PM to 1:30 PM
71206431 416 Marlborough St U:702 4 room, 2 bed, 2 bath Mid-Rise $659,000 Aug 14 12:00 PM to 3:00 PM
71203399 393 Marlborough St U:2 2 room, 0 bed, 1 bath Brownstone $314,900 Aug 14 12:00 PM to 1:30 PM
71199977 373 Marlborough St U:4 5 room, 2 bed, 2.5 bath Brownstone $1,159,000 Aug 14 1:00 PM to 2:30 PM
71199948 389 Beacon St U:1 3 room, 1 bed, 1 bath Brownstone $369,000 Aug 14 11:00 AM to 12:00 PM
71193526 362-366 Commonwealth Avenue U:3I 4 room, 2 bed, 2 bath Mid-Rise $524,000 Aug 14 1:00 PM to 2:00 PM
71184548 190 Beacon St U:2A 5 room, 2 bed, 2 bath Brownstone $1,500,000 Aug 14 1:45 PM to 2:45 PM
71179825 229 Beacon St U:4 7 room, 3 bed, 2.5 bath Brownstone $1,875,000 Aug 14 11:30 AM to 12:30 PM
71258949 285 Beacon Street U:4B 5 room, 2 bed, 2 bath Low-Rise $1,250,000 Aug 14 1:00 PM to 2:00 PM
71245954 17 Gloucester St U:9 5 room, 2 bed, 2 bath Brownstone $1,299,000 Aug 14 12:00 PM to 1:00 PM
71064709 43 Commonwealth Avenue U:PH 5 room, 2 bed, 2 bath Brownstone $1,799,000 Aug 14 11:30 AM to 12:30 PM
70989911 286 marlborough U:3 8 room, 3 bed, 2 bath Townhouse $899,000 Aug 14 1:00 PM to 3:00 PM

Above, 329 Beacon Street #4, Back Bay, Boston, Massachusetts. David Wesiberg of Boston’s Luxury Properties is the listing agent.

Massachusetts’ housing affordability at 20-plus year low
Aug 2011 12

An analysis of historic housing prices and 30-year mortgage loan rates proves that housing is affordable to more Massachusetts’ home-buyers than at any time in at least 20 years.

I plotted the Standard & Poors / Case-Shiller home price index data for every month and year from January 1987 to May 2011. A rough estimate of what homes were worth in the past, and as good as any data for an analysis of this sort.

Then, I used data from the HSH historic mortgage rates website to plot average 30-year fixed-rate mortgage loans for each month during the past 24 years.

In May 2011, the median single-family home sold in Massachusetts for $304,000, according to The Warren Group. Working backward using the S&P / Case-Shiller values, I was then able to estimate what a single-family home sold for in every other month, from 1987 to today. (Case-Shiller normalizes January 2000 to have a value of 100, with dates before and after that adjusted.) (Case-Shiller and The Warren Group use different data; The Warren Group is for all of Massachusetts, whereas Case-Shiller is the “metropolitan statistical area” around Boston. The Warren Group’s values are probably lower than Case-Shiller, since they use homes in western Massachusetts, whereas Case-Shiller is more eastern Massachusetts, plus as far north as New Hampshire.)

I pulled median household income data from the US Census Bureau. (None of my figures are adjusted for inflation, which makes sense, since your pay in 1990 had to buy a home in 1990 dollars.)

What does my analysis show?

In 1990, the median home sale was for $146,503. This equated to $1,026 per month in mortgage loan payments at a fixed-rate loan at 9.98%. The median household income was $36,952, so you’d pay 33.34% of your annual income on your loan (assuming a 20% down payment).

In 2000, the median home sale was for $201,351. This equated to $1,218 per month in mortgage loan payments at a fixed-rate loan at 8.32%. The median household income was $50,502(!), so you’d pay 28.94% of your annual income on your loan (assuming a 20% down payment).

In 2009, the median home sale was for $303,496. This equated to $1,425 per month in mortgage loan payments at a fixed-rate loan at 5.80%. The median household income was $64,057, so you’d pay 26.69% of your annual income on your loan (assuming a 20% down payment). (Unfortunately, I don’t have 2010 or 2011 median household income data.)

The key figure, obviously, is the interest rate. It’s come down from double-digits in the 1980′s. It’s at almost an historic low.

For those who are in the position to buy right now, it’s a golden opportunity to lock in the cost of housing for years into the future, for the cheapest amount possible in over two decades.

Mortgage loan rates skirt historic lows; Boston rates low, too
Aug 2011 11

Mortgage loan rates dropped again, this past week, skirting the lowest rate, ever.

The average 30-year, fixed mortgage rate decreased to 4.32%, according to the Freddie Mac weekly survey of loan providers.

The 30-year fixed-rate mortgage (FRM) averaged 4.32 percent with an average 0.7 point for the week ending August 11, down from 4.39 percent, last week. Last year at this time, the 30-year FRM averaged 4.44 percent, so rates are lower.

A $400,000, 30-year, fixed-rate mortgage at 4.32 percent would run you approximately $1984 per month in loan repayments. This is down from $2,000, last week, $16 per month less, and $12 less per month compared to last year, when it would have cost you $2,012 per month.

Frank Nothaft, vice president and chief economist at Freddie Mac says, “Renewed market concerns about the European debt markets led investors to shift funds into U.S. Treasuries, pushing long-term yields lower. Further, in its August 9th Federal Open Market Committee statement, the Federal Reserve noted that economic growth so far this year had been considerably slower than it expected and that overall labor market conditions had deteriorated in recent months, leading the Committee to conclude that an exceptionally low federal funds rate should be maintained at least through mid-2013. These developments helped to ease mortgage rates lower this week.

“Lower mortgage rates will help to maintain the high degree of home-buyer affordability in the market. The National Association of Realtors® reported that its affordability index over the past three quarters has indicated the highest affordability since the inception of the index in 1970.”

If you’re considering a home purchase this fall, now is the time to speak with a mortgage broker.

Celtics coach Doc Rivers gets deal of the century on Boston condo buy
Aug 2011 10

Celtics coach Doc Rivers closed on the purchase of a luxury condominium home in the Back Bay of Boston.

According to Boston.com and the Suffolk County Registry of Deeds, Glen “Doc” Rivers paid $2.2 million for unit #1610 in the Four Seasons at 220 Boylston Street. Zillow.com reports that this was a two-bedroom, two and ½-half bathroom, ~1,801-square foot home. The building offers residents a spa, pool, fitness center, boardroom, 24 concierge, room service, and 24-hour hotel service.

Eagle-eyed real estate watchers will remember that this condominium was first listed for sale in June 2008 for $10 million. Yes, $10 million, or around $5,552 per square foot.

The list price was so astronomical that the Boston Herald did a story on it (there is a photo gallery of the interior on its website), and the Boston Business Journal did earlier, back when it was listed as a for-sale-by-owner at $8 million.

The owners eventually lowered the list price to a more reasonable $3.5 million when they listed it with Beth Dickerson at Gibson Sotheby’s International Realty in December 2010; eight months later, it’s been sold for $2.2 million, or $1,221, in line with other luxury, high-end condos sold in the Back Bay and Boston.

The sellers did well, after all. According to the public record, they purchased the condo in 1995 for $973,130.

Image above from Wikipedia

Zillow: Downtown Boston home values rise in 2nd quarter
Aug 2011 10

Online real estate valuation company Zillow.com says that home values rose during the second quarter 2011 in many downtown ZIP codes, as well as in other Boston neighborhoods.

The Boston Business Journal has the details.

Demographically, they’re on opposite ends of the spectrum, but Boston’s Beacon Hill and Mattapan neighborhoods do share something in common: They were both among the hottest housing markets in the state in the second quarter.

The BBJ has a cool interactive tool that you can use to plug in your town or city’s name or do it by ZIP code. Not all ZIP codes are available (no 02113-North End, for example) but 159 towns and cities are.

For ZIP code 02118, which is most of the South End and a bit of Roxbury, sales volume was off in the second quarter by 29% (!) but prices were up 3% from first to second quarter and 1% since last year at the same time.

The Zillow.com data is useful if you track it by quarter, but it does have some serious weaknesses.

As the BBJ points out: Zillow’s valuation data is based on all homes in a given market, and not just properties listed for sale or sold in a given period.

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