Cambridge Area Real Estate Newsletter*
Dear Friends and Neighbors,
This was the 9th year I volunteer directed the Cambridge Housing Assistance Fund (CHAF). CHAF’s 9th Annual Benefit Concert for the Homeless exceeded its goal and raised $185,000 to help 250 homeless and near homeless families and individuals to move from shelters to homes, or to avoid losing their home in the first place! This year’s concert featured the great Freddie Cole (brother of Nat King Cole), Detroit diva Kathy Kosins and saxophone legend Red Holloway. For information about CHAF or to find out how you can help or make an on line donation, visit www.CHAFund.org.
If you read the Globe every day, you might never leave your house. There are daily headlines about ‘The Mortgage Meltdown’ and ‘The Housing Crisis.’ The Globe will say something like ‘Housing Prices Drop 15th Straight Month.’ Oh no, say it isn’t so. The sky is falling! But as you read on it will clarify that the statewide average price of a single family home declined ~4% in 1 year. This after a 5 year run up of close to 50%. This they call a crisis? And condos on average went up 1% in the same time period. Again, so where’s the fire?
In Cambridge, from 2000 to 2005, average prices for singles went up 33% and for condos, 30%. From 2005 (considered a peak) to November 30, 2007, prices went down on average 5.5% for singles and 1.5% for condos.** (Anecdotally, some homes went down more as these averages may be skewed by some large luxury condo developments which pull the averages up.)
In Somerville, from 2000 to 2005, average prices for singles went up 55.5%, and for condos, 40.5%. From 2005 to November 30, 2007, prices went down on average 4% for singles and 1.5% for condos.
For the last two years on average, in spite of what you read in the press, we have been in a market with relatively stable prices. Prices in Cambridge-Somerville are down only ~2-2.5% per year for singles and less than 1% per year for condos. This is obviously very different than the impression you get in the media.
While the recent sub prime mortgage problems may have serious consequences nationally and internationally, and there is some talk of a possible recession, in my opinion the effect in the Cambridge real estate market will be limited. The ‘spring’ market (starting late January to early February) is likely to be perennially robust. In reaction to the Globe beating the drum, some buyers are sitting on the sidelines, waiting for prices to drop, and they may miss some good deals.
Interest rates are still low, around 6% OR LESS for a conforming loan. And jumbos remain under 7%.
If you are considering selling, and you want to have the best advice on how to market and position your house in today’s real estate market, let me know. And if you are buying, and want to have experienced advice on what house to buy and how much to pay, give me a call.
I'm celebrating my 21st year in Cambridge area real estate sales, and with 15 years before that as a designer/builder/woodworker, that's 36 years experience working with Cambridge area housing! Most of my business now is word of mouth. Thank you for your many referrals and for contributing to my success!
I look forward to hearing from you, whether to simply catch up, or to assist you with real estate.
Happy New Year!
Email Address: David.Pap@NEMoves.com
*While this newsletter is mostly about Cambridge, I do cover surrounding communities as well. Every town is different, so call me if you have questions about the value of your home or what to buy.
**Statistics from properties entered in MLSPIN