Million dollar homes in Massachusetts
A Million Dollars still conjures up an image of luxury, and I suspect many of us are attracted to headlines which include the magic number. This article will look at Million Dollar homes for the counties of Massachusetts, with a breakdown by town for Essex County.
Note that all numbers are from the MLS, which does not include Nantucket or Martha’s Vineyard, and may exclude some sales in other parts of the State which have their own reporting system. With that caveat, let’s get started.
First, sales for the Last 12 Months (LTM).
Here’s a pie chart:
Source: MLS, Oliver Reports
and here are the numbers:
Source: MLS, Oliver Reports
The good news is that, despite the concern about the lack of sales at the higher end, there were nearly 2,000 sales of Million Dollar Plus (MDP) homes in MA in the last year. Note, however, that 73% of these took place in Middlesex (Belmont, Cambridge, Concord, Lexington, Newton, Wayland, Weston, Winchester) and Norfolk (Brookline, Cohasset, Needham, Wellesley). Suffolk (Boston) has fewer than one might expect because the main market is condos, of which 500 sold at MDP.
Now let’s look at Essex County. First, the pie chart:
Source: MLS, Oliver Reports
And then the numbers:
Source: MLS, Oliver Reports
One surprise, at least to me, is the low number of sales in Manchester.
Next we’ll look at the number of houses currently for sale for $1 million or more. We’ll start again with the State by County:
Source: MLS, Oliver Reports
and the numbers:
Source: MLS, Oliver Reports
This lets us calculate the current supply, bearing in mind that a market with 6 months of supply is generally considered to be in equilibrium between buyers and sellers:
Source: MLS, Oliver Reports
No real surprises here: the higher the price, the longer to takes to sell.
Now Essex County for sale:
Sources: MLS, Oliver Reports
and the numbers:
Source: MLS, Oliver Reports
and the supply:
Source: MLS, Oliver Reports
Thus we can see that the supply in Essex County is roughly double that for the State generally.
And finally, pending home sales: where there is an accepted offer but the sale has not yet closed:
First, by County:
Source: MLS, Oliver Reports
and the numbers:
Source: MLS, Oliver Reports
and for Essex County, by town:
Source: MLS, Oliver Reports
and the numbers:
Source: MLS, Oliver Reports
These numbers again show that sales at the higher end are taking place, especially in Middlesex and Norfolk Counties. Here in Essex County, sales are slower. Two possible reasons are the large supply, and the general observation that buying at the top end starts in Boston, moves to the immediate suburbs, and then after that ripples further out. If the latter opinion is right, then 2014 may be a better year for higher end sales in Essex County.
Andrew:
I need to improve my communication skills, because I never meant to say any other residential real estate news / information, other than local news / information, cannot be interesting to readers.
I never demanded you change anything; just asked for your reasoning for not including the caveat. I never got it, so I kept asking. Just don’t understand your reticence.
The caveat would be overly meaningful to those readers who may be new to residential real estate, and those in a position where they will be making a big decision regarding the value of property they own. To them, the weight of their money should be wagered on what is going on in the local marketplace.
Vb, Jody
Hi Andrew.
Never saw my comment to your comment (below), and your response published. Am interested in your further thoughts, and any from other interested readers.
Hi Andrew –
Thank you for your reply.
Your reasoning and example supporting your comment: “I do not share your opinion that data beyond the immediate community is meaningless” didn’t convince me.
I have always assumed your blog was primarily focused on helping buyers, sellers, and owners of property be knowledgeable about the properties they have an interest in or own, and, making buying and selling decisions. My comments have been oriented around that assumption.
Why bang out national, regional, and other non-local interest and employment rates, number of sales, number of properties on the market, average selling prices, and all other statistics, and, pundit’s narratives? The local real estate action is what is cogent; the rest is “Fark”.
Taking your example, if I were looking to buy or sell a condominium in Boston, Brookline, Cambridge, …, the condominium activity on the Northshore, let alone New England or the whole country, wouldn’t be important or of interest to me. Buyers and sellers – not information wonks, only really care about what is happening in the areas where they have an interest in buying, selling, or where they live.
I read your very first report that was titled “Lies, Damned Lies and Statistics”. Hopefully you will have many new subscribers over time, but many will be new to residential real estate, and not have read it.
So, back to my previous comment and question, shouldn’t ? an important caveat preceding every residential real estate blog, whose goal is to channel meaningful real estate information to buyers, sellers, and owners of residential real estate be something like: “residential real estate is a local phenomenon. For making your best residential real estate decisions, look to the critical indices and information derived from your local market’s activity.”
As always, looking f0rward to your response.
Very best, Jody
Jody: according to my records all 17 of your comments have been approved and posted.
As to why I write on matters beyond Marblehead, the simple answer is because on my site I choose to write about local, regional and national matters. On the right hand side of the website you will see the categories, which include Marblehead, Massachusetts, and National, as well as Mortgage and Finance.
While I understand from your comments that your interest lies in reading about Marblehead matters, my post this weekend on Million Dollar Homes in Massachusetts, which included data throughout the State, received the highest number of views of the 119 article I have posted since I started this blog last November.
Andrew:
whether you post a local, regional, or nationally oriented blog piece, you haven’t answered the question I posed:
“Shouldn’t an important caveat preceding every residential real estate oriented blog, whose goal is to channel meaningful information to buyers, sellers, and owners of residential real estate be something like: buying and selling residential real estate is a local phenomenon. For its best understanding and making your best residential real estate decisions, look to the critical indices and information derived from your local market’s activity.”
Please let me and other interested readers know your thoughts, and, if you don’t agree, how come? To me that type of real estate caveat to buyers and sellers is as important as any warning label placed on a product whose misunderstand use could create serious problems.
Thank you, Jody
Jody: I respect your knowledge and perspective. I believe that wider influences and trends are relevant.
Jody,
Speaking for myself, I certainly find the broader view of real interest, for many reasons. Just to give a few:
– trends elsewhere can suggest trends likely to start soon here;
– as part of the Massachusetts economy, my interests go well beyond what I might be able to sell my house for tomorrow (and, while noting that, I expect that most readers aren’t actually planning on selling their house tomorrow);
– local data sets are often too small to give a reliable picture. The next best available data comes from next door (like Swampscott and Manchester – you’ll note that the data is reasonably consistent within the towns Andrew cites, as compared to that coming from those in other counties, which he contrasts).
So I’d be quite happy to continue to be able to see the bigger picture.
Andy
Hi Andy:
thank you for your perspective.
I didn’t mean to advocate limiting Andrew’s blogs to just local real issues and events, and that local real estate is the only interesting field for thought.
what i was advocating was including the caveat i described for readers who: are new to residential real estate, and / or have a stake in their present real estate marketplaces, where they could be making some big, far reaching decisions.
very best, Jody
Hi Andrew,
Very impressive and clear compilation of data, as always. You may have covered this in past reports, but the questions that occur to me when I read this are:
– Why are people willing to pay so much more to live in Middlesex and Norfolk?
– Do you have data on how many sales have occurred in the last 12 months of sub-$2,000,000 houses that were replaced with new houses? I wonder whether existing $2 million and up houses are staying on the market because buyers would rather design their dream housees than settle for someone elses.
The latter seems particularly likely when you look at the number of near, or complete, rebuilds you see in places like the Neck and Goldthwaite.
Keep up the good work!
Andy
Great report!
hi andrew:
interesting analysis, and I liked the caveat. all postings of narratives and statistics should be prefaced with any and all relevant caveats.
vb, Jody
Glad you approve!