The July rental market saw a return (somewhat) to a typical seasonal lull in activity as people put their home/apartment searches on hold in favor of heading to the beach. The seasonal slowdown has been much less drastic than pre-pandemic normal levels as people continue to flock back into the city and take advantage of new construction incentives while planning to go back to school and office life. The unusually rainy summer so far has also put some beachgoers’ plans on hold in hopes of sunnier days in August, freeing up more time to lock down housing plans. Rents are by most accounts back to pre-pandemic levels which have resulted in a rise in demand for the typically hot (and affordable) commodity of studios and one bedroom apartments. Two bedroom apartments also remain in high demand, as people still prefer to have a separate home office if they can afford it. The 3 and 4 bedroom rents have not quite made it back to their normal pre-pandemic levels, however, that inventory has continued to be absorbed and has slowly gained traction. Many landlords have taken advantage of unforeseen vacancies by making improvements to their properties, which has almost become a necessity in order to compete with the increase in new construction availability. Those apartments that otherwise remain in classic (read: tired) condition should plan on taking slightly less in rent and/or offer incentives, lest they remain vacant into the Fall. This should offer those renters who missed the boat on the incredible deals earlier in the year, an opportunity to scoop something up at a good value.
The sales market has also seen somewhat of a typical seasonal slowdown in activity which is helping to boost the number of available homes for sale – in SOME areas. There are still parts of the city and suburbs where inventory is a fraction of what it was in past years, and prices are WAY up. For instance, in Wayland there are currently SEVEN (7!!!!) homes for sale on MLS whereas at the same time in July 2019 there were 59! And the average sale price in Wayland like in many areas is up over 20% YoY. That said, there are indications that prices are peaking and sellers should take heed. After a sharp rise in sale to list price percentage this year, the average sale to list prices appear to have peaked at around 102% as list prices are up 12% YoY and the values appear to be topping out. Also, the percentage of listings with price drops has hovered around 2.5% for most of the year but has almost doubled to pre-pandemic levels in the past two months creeping closer to 2019 levels of nearly 5% of active listings seeing price drops. After peaking early in the year, the number of days on market dropped precipitously and has now appeared to have leveled off at around two weeks with indications that the average days on market may even be starting to increase ever so slightly.
What does all of this mean????
For those buyers looking for a ray of hope, the latest figures may be welcome news. Don’t get too excited though, it is still very much a competitive seller’s market and is expected to remain so for the foreseeable future. In other good news for buyers, this week’s interest rates decreased to their lowest levels since February!!! So if you’re thinking about buying a new home, give your Metro agent a call today!