The Massachusetts Association of REALTORS® (MAR) reported today that the number of single-family homes and condominiums put under agreement in the month of May increased over last year while median prices also saw a hike year-over-year. The pending median price for a single-family home rose over the $400,000 mark for first time in 2018 and for the third time in the last 12 months. May's "Hot Topic" question found that a majority of REALTORS® clients' ability to secure financing in the current lending environment has remained the same since last year.
May Pending Sales
|Homes||May 2018||May 2017||% Change|
|Total Sales||7,226||6,725||+ 7.4%|
|Median Price||$405,000||$383,000||+ 5.7%|
Pending sales have been up or flat 11 of the last 12 months.
|Condos||May 2018||May 2017||% Change|
|Total Sales||2,690||2,562||+ 5.0%|
|Median Price||$385,000||$370,000||+ 4.1%|
Pending sales have been up or flat 10 of the last 12 months.
"Buyer demand shows no signs of slowing down as we head into the busy spring and summer markets," said 2018 MAR President Rita Coffey, general manager of Century 21 Tullish & Clancy in Weymouth. "We may see another summer of record-breaking prices if Massachusetts doesn't find more inventory to feed this strong demand."
REALTOR® Market & Price Confidence Indexes
|Confidence Index||May 2018||May 2017||% Change|
|Median Price||74.72||73.94||- 1.1%|
Measured on a 100-point scale, a score of 50 is the midpoint between a strong (100 points) and a weak (0 points) market condition.
"Both the Market and Price Confidence Indexes are trending down this month in part because inventory is continuing to trend down," said Coffey. "Still, confidence levels remain historically high because the buyer demand is there.
Monthly Hot Topic Question
The May "Hot Topic" question asked REALTORS® how they would describe their clients' ability to secure financing in the current lending environment, compared to the same time last year. Of those who responded, a majority (73%) said that their clients' ability to secure financing has remained the same since 2017. Fifteen percent of respondents said that their clients' have been having a somewhat more difficult time than last year. Another 12 percent responded that their clients have had it somewhat easier this year. A remaining one percent said their clients' ability to secure financing have been significantly more difficult.
"Despite the significant tax overhaul and other financial changes brought on by the new administration, clients' ability to secure financing for their homes has remained essentially the same over last year," said Coffey. "It will be interesting to see how and if these answers fluctuate in another year."
About the Data Sets
The tracking of signed purchase and sales agreements (also called "pending sales") provide reliable information about where the real estate market is heading in coming months.
A pending sale or a sale "under agreement" happens when the buyer and seller agree on the terms of the sale of a home and have a signed purchase and sale agreement, but have yet to close and be recorded as such. MAR is the only organization, which compiles this statewide information from Multiple Listing Services each month.
Monthly pending (or under agreement) data and closed sales data comes from the three REALTOR® affiliated Multiple Listing Services in Massachusetts. They are the Berkshire County Multiple Listing Service, Cape Cod & Islands Association of REALTORS® Multiple Listing Service, Inc.; and MLS Property Information Network, Inc. The data is compiled by 10K Research and Marketing, Inc. and updated each month. As a result, previous data may change after the reports have been run.
The Massachusetts REALTOR® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
The REALTOR® Index Methodology
The Massachusetts REALTOR® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts:
• How would you describe the current housing market?
• What are your expectations of home prices over the next year?
In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
The RMCI is calculated in the following way. Respondents indicate whether conditions are, or are expected to be strong (100 points), moderate (50 points), and weak (0 points). The results are the average score for each question. A score of 50 is the threshold between a strong and a weak condition. Similarly, the question about home prices over the next year (REALTOR® Price Confidence Index) is calculated using five categories: Rise 0-5% (75 points), Rise 5%+ (100 points), Level (50 points), Fall 0-5% (25 points), and Fall >5% (0 points).
About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 24,000+ members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.
Editors and reporters: Please note that the term REALTOR® is properly spelled with capitalized letters and the registered trademark symbol, per the Associated Press Stylebook.