Top 5 Real Estate Predictions for the Boston Suburbs in 2021
Written by Carey Sclafani, on behalf of Suzanne & Company
Goodbye, 2020. Hello, 2021! While there’s no mistaking the havoc wreaked by the global pandemic, there were silver linings throughout, and some aspects of life-as-we-knew it may be replaced with new priorities. As shelter-in-place orders went into effect and travel halted, people began to place a higher value on their home and living space. Houses became homes; neighbors became pods; apartment buildings became communities -- and house prices surged as we all became more invested in our immediate environment. As indicated in a recent Boston.com article, single-family home prices increased by 14.4% in 2020, while condos were up an average of 9% from the prior year.
At Suzanne & Company, we stuck together as a team to help a whopping 137 families – 70 sellers and 67 buyers. “It’s a huge honor to be helping people with their biggest asset, something that’s near and dear,” says Suzanne Koller. Remarkably, this was achieved while navigating new ways to make connections and share information in a virtual environment. The past year brought some changes in buyer preferences that will likely impact the 2021 market. Most notably, there was a big shift from smaller houses and city living to bigger houses and yards. While the Boston market hasn’t seen the urban exodus that cities like NYC and San Francisco experienced, December sales in Middlesex County rose by 27.6% from 2019 to 2020, compared to only 1.4% in Suffolk County where Boston is located, according to the county-by-county report compiled by The Warren Group.
What does all of this mean for 2021? History tells us that while no two recessions unfold in the same manner, there can be similarities. Many comparisons have been drawn between COVID-19 and the influenza pandemic of 1918. As summarized in a study on the economic impact of the influenza pandemic, some industries suffered severe losses, while others experienced gain. This mirrors much of what we’re seeing today. In the Boston area, the real estate market is one that has seen growth and will contribute to our economic recovery. But while mortgage rates remain at an all-time low, inventory is still limited. It certainly looks like it will remain a unique blend of a seller’s market in terms of demand, but a buyer’s market from a financing standpoint. Whether you’re looking to buy or sell, here are some trends that our local expert, Suzanne, says you might see:
1. EMPHASIS ON COMMUNITY AND INFRASTRUCTURE.
As our circles became temporarily smaller and we stayed close to (or in!) our homes, what our cities or towns offered became more critical. Town amenities, school systems, and safety inched their way up on the list of highly sought-after factors. We expect these to remain significant.
2. CONTINUED FOCUS ON THE OUTDOORS, BOTH AT THE HOME AND IN THE COMMUNITY.
Keeping distance from others is always easier to do in wide-open spaces, and the quarantine mentality has caused many people to explore their own backyards, so to speak. While once a less desirable feature, pools are now highly sought-after, though installation of new ones is taking much longer. Yards, patios, hot tubs, saunas and attractive landscaping are popular items. This yearning for outdoor offerings extends to the community as well. Parks, trails and other places to be active outdoors have spiked in importance to home buyers.
3. A NEED FOR MORE SPACE.
In recent years, there was higher demand for proximity to cities, which typically equated to smaller houses and lots. With Covid-induced stay-at-home orders, the need for additional spaces exploded – a room or nook to use as a home office, a quiet area to participate in remote schooling, a location to convert into a gym or workout space. There has also been a shift away from older relatives moving into long-term care facilities. Finding a home that can accommodate an extended family or that offers single-level living has become more of a priority.
4. THE ‘BURBS ARE THE PLACE TO BE!
Without a need to commute to an office in the city, prospective buyers have extended their house search out farther from Boston. A recent home close to I-495 received roughly 40 offers! The secondary markets in New Hampshire, Cape Cod and Maine have seen an influx of new residents, as workers are anticipating that a new normal will include more flexibility with remote work options.
5. LOOKING TO INVEST? NOW COULD BE THE TIME!
With record-low interest rates and more inventory available in the city than the suburbs, now could be the time to purchase that investment property in Boston. As The Warren Group report shows, condo prices in Suffolk County were only up 3.6% in 2020, compared to generally higher sale price increases in other counties.
Ultimately, there will always be some level of unpredictability in the real estate market. But you can be certain sellers will keep selling and home buyers will keep buying – and we are here to help make that process easier for you.
