The third quarter of 2024 has been a dynamic period for the Massachusetts real estate market, with Barnstable, Plymouth, Bristol, and Suffolk counties reflecting unique local trends while being influenced by broader national factors. As the economy adjusts to recent developments, particularly the Federal Reserve’s actions on interest rates, the market outlook is evolving in important ways. In Barnstable County, demand for luxury and vacation properties continues to outpace supply, driving price increases in the area. The coastal lifestyle, coupled with limited inventory, has kept the market highly competitive. Buyers seeking homes in Cape Cod must be prepared to act quickly, as homes continue to sell fast despite rising prices, which have climbed roughly 5% over the past year. Plymouth County, characterized by a blend of suburban and rural communities, remains attractive to buyers seeking more space away from the city. Affordability remains a critical factor, especially for first-time homebuyers, though there has been some relief with a slight increase in inventory over the last quarter. Home prices in this region have risen by about 4%, with towns like Hingham and Duxbury seeing particularly strong demand. In Bristol County, the market has remained stable, serving as an affordable alternative to areas closer to Boston. It continues to attract buyers from nearby regions, including Rhode Island, as well as renters from its university towns. While new construction has been limited, the region’s relatively lower prices make it an appealing option. Median home prices have increased by 3.5% this quarter, and the rental market remains strong, particularly in cities like Taunton and Fall River. Suffolk County, including Boston, remains a key focus in the state’s real estate landscape. Condominiums have seen a resurgence in demand as more workers return to the office and urban living regains appeal. However, affordability remains a challenge, particularly in high-demand areas. Suffolk County has experienced a 6% increase in median home prices, with Boston’s prime neighborhoods like Back Bay and Beacon Hill leading the charge. Despite these challenges, the county remains one of the most competitive markets in the state. On the national front, recent actions by the Federal Reserve are beginning to impact the market. The Fed’s decision to begin interest rate reductions with a bold .5 percentage point cut in September and signal future rate cuts over the next 18 months has already had a positive effect, with mortgage rates seeing a slight decline. This rate drop has started to stimulate buyer interest, particularly among those who had been priced out earlier in the year due to higher borrowing costs. If the Fed continues with further rate cuts as anticipated, the Massachusetts real estate market could see increased activity, particularly in counties like Suffolk and Barnstable, where higher home prices have historically limited affordability. Looking ahead, the potential for continued rate drops over the next 18 months is likely to have a profound impact on both buyers and sellers. Lower borrowing costs could bring more buyers back into the market, fueling demand and intensifying competition for available homes. This will be particularly true in areas like Suffolk and Barnstable, where limited inventory already creates a competitive environment. Conversely, more affordable counties like Plymouth and Bristol could attract buyers seeking better value, potentially driving moderate price growth in those areas as well. Overall, the Massachusetts real estate market is poised for an interesting period of adjustment as it responds to both local dynamics and national economic changes. As interest rates continue to decline, we expect to see increased buyer activity, ongoing price appreciation in high-demand areas, and a rebalancing of affordability across the state. Both buyers and sellers will need to remain strategic in the months ahead to capitalize on these shifts and navigate the evolving market conditions. — 2 — EXECUTIVE SUMMARY Emily Clark President, Berkshire Hathaway HomeServices Robert Paul Properties
RkJQdWJsaXNoZXIy NjE5