The first quarter of 2023 has brought regained buyer confidence to the market. For the first time in several months, we have seen an increase in buyers returning to the market as mortgage interest rates have stabilized in recent weeks. Many buyers who were outperformed over the last few years by stiff competition in the market have returned as life keeps moving and their need to buy remains. Housing is a necessity and there are always reasons to make a move, whether it be the loss of a family member, separation, new addition to the family, job-related relocation or becoming an empty nester. These are the moves that we are seeing now. With 70% of Americans holding a mortgage rate that is four percent or less according to Rick Sharga, executive vice president of market intelligence at ATTOM Data, homeowners are taking careful consideration when it comes to the reason for selling in a market with significantly higher mortgage rates and record-breaking home prices. Inventory remains tight as we move into the spring market, a time when we typically see an increase in properties coming on. We must remember that it took 15 years to get to where we are now, and it will take some time to return to the elusive stable market. On a positive note, there are signs that the market on Cape Cod and Greater Boston are moving in that direction. While the number of new listings for the first quarter is down in Barnstable County by 20%, the days on market has increased by 31%, indicating that it is taking longer to sell a home. Looking at Greater Boston and the South Shore, areas that are considered primary home markets, there is a slight increase in active inventory across the board. This indicates that the inventory is beginning to strengthen and will bring a few more options to buyers that are ready to perform this season. Boston and its surrounds are the main feeder market to Cape Cod. Often, trends that impact the urban market eventually make their way to the Cape and South Coast, and this is a trend that will be welcome in the resort markets. What is clear is that low levels of inventory, surging interest rates and decades of underbuilding will keep home prices high here in the Commonwealth. The only way to find a reprieve from the high prices is to increase supply. This means that we need more sellers to sell and homebuilders to up their current production. At the current rate, the market will be facing a long-term trend of low inventory and high home values throughout Greater Boston, Cape Cod and the surrounding areas. As we move into spring homebuying season, we will continue to keep a watchful eye on the economy, which continues to be pulled in many directions by high inflation and Fed interest rate hikes. — 2 — EXECUTIVE SUMMARY Emily Clark President, Berkshire Hathaway HomeServices Robert Paul Properties
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