Sam Palmer has been selling houses for two decades in Westford, watching the market ascend over the years as more and more farmland was sold to developers.
But as the pace of migration from urban areas picks up speed, real estate professionals are watching the rapid rise of purchase prices in disbelief.
Between May and July, the selling price of a single family home in Westford reportedly jumped by 3 percent. That number could not be confirmed by William Naser, Westford’s primary assessor, but Naser was just as intrigued as everyone else in town by the market valuations.
“I’m not a crystal ball guy,” Naser stated, “but if you said that the value of the Real Estate market was going to be fantastic the next year and a half, after March 2020,I would have been a doubter. But here we are–sale prices continue to climb while available units remain below demand. Current sales seem to be going at asking price or above asking price.”
The Price of a House in Westford
The medium price of a single family home in Westford today is $475,000, according to Palmer.
“If you took a look at the entire single family housing inventory throughout the town, that average would be in the high 4’s,” Palmer said. “But if you look at the sales over the past 12 months, than you would be in the low $700,000’s to $720,000…which works to around $300 per square foot based on the average size. It’s a pretty heavy number. In the last six months, there’s been 123 homes sold in Westford. Of those 123 sales, 101 sold over-asking price…”
In fact, Norader Real Estate of Laguna Niguel, California, has published a median price for Boston metro single family homes at $825,000. Renters don’t have it any easier, according to Norader. A one bedroom apartment in Lowell rents, on average, at $1,540 per month. That number increased by 1.3 percent month over month, and by 8.5 percent, year over year.
The respected Case-Shiller indices monitor prices of single-family houses throughout the country. The numbers are a good indicator of how well the economy is performing.
“The S&P’s CoreLogic Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate nationally,” according to the company’s website.
Why is this Happening?
Local realtors are pointing to an ongoing migration to the suburbs from urban areas, as one reason for the tightening of available houses. But there’s no doubt that a serious shortage of housing beginning several years ago in metro Boston is exacerbating things.
“I think it’s a supply and demand issue,” said Palmer. “…there’s more buyers than sellers right now. This type of growth is something I have not seen in my 22 years.”
Coldwell Banker Realtor Leslie Thomas who is in her 30th year of selling homes in Westford, pointed to historically low interest rates as contributing to the shift.
“I think there are a lot of people who have been renting and I think one of the major things is interest rates. They’re still the lowest they’ve ever been,” said Thomas. “They’re still below 3 percent and that made people who didn’t qualify and weren’t able to buy a house before to be able to buy a house.”
Thomas noted that the price of condominiums skyrocketed this year.
“The prices have been shocking,” she said. “Some that started in the $500,000 range were selling even at $800,000 to $900,000. It’s really kind of unheard of,” Thomas said.
The realtor said a Westford house priced in the 600,000s sold for $40,000 over the asking price.
“One (sold) for $100,000 over the asking price with multiple offers,” Thomas added.
Another sold for $281,100 over it’s asking price, Palmer said, adding that “those figures took my breath away.”
How Long Will it Last?
How long with this market climb last?
“There’s no way to predict it,” said Palmer. “There’s 13 homes on the market today. There’s 55 homes under agreement or under accepted offer. Things don’t last on the market for more than seven to 14 days. Until we see a tempering of that, it’s anybody’s guess..”
Buyers are showing up with cash, Palmer said. He speculated that with all the COVID deaths, some of the money may be inherited wealth.
“I personally have worked on transactions that as part of the package there’s a proof of funds letter showing they have the assets in the bank,” Palmer said. “I get proof of funds letters that would just knock you over.”
No one has a better view of Westford’s real estate market than Naser.
“Sale prices continue to climb,” he stated. “Current sales seem to be going at asking price or above asking price.”
“It’s really remarkable,” Naser added.