Massachusetts Housing Market Slump Continues in December

According to the Boston Globe, the Massachusetts real estate slump continued last month, as single-family housing sales posted their worst December since 1991, and the median price for a single family home fell 8.1 percent to $310,000 in December 2006.

The December median sale price is the lowest monthly figure since March 2004. Those are among the conclusions of a report on the Massachusetts housing market issued today by the Warren Group, a Boston-based provider of real estate data and the publisher of Banker & Tradesman.

On a volume basis, December single-family home sales fell 8.4 percent from their December 2005 levels to 4,037, the lowest level for December since 1991. With the costs of Massachusetts mortgage loans more than most residents can bear, it’s no surprise to many that the market has come back to earth.

“We’re still in the midst of a market correction which began in the latter stages of 2005,” Timothy Warren Jr., CEO of the Warren Group, said in a statement, adding that he wasn’t concerned things would get worse.

“We still see this as more of a soft landing than a crash, though, and we’ll be watching closely the next few months for signs of stabilization.”

For the full year of 2006, single-family home sales dropped 14.4 percent to 54,203, the lowest number of homes sold since 1995, and down 20 percent from the peak year of 2004, with a rise in foreclosures soon to follow, the Warren Group said.

The median sales price for a single-family home dropped 5.8 percent to $325,000 in 2006 in the Bay State; the first annual drop since 1993. As mortgage loan costs sky-rocketed after five straight years of record housing growth, inventory and prices finally exceeded demand.