Source: Banker and Tradesman —
Last year was another historic one in a succession of historic years for the real estate industry. In early 2020 the world was rocked by the breakout of COVID-19, followed by a frenzied housing market in the second half of 2020 and then 2021 with inventory lower than it ever has been in recorded history. 2022 was the tipping point when the market began its journey back to baseline.
Market adjustments, global pandemics, and anemic inventory are not for the faint of heart. To have skin in the game of real estate over the past three years has required dedication and resilience and so we are well prepared for what’s to come as we adjust back into a more balanced market.
Annual sales for the state of Massachusetts were down for the year. This is not a sign that the market is crashing in the typical terms that it is understood. Many twists and turns over the past few years have been easily spun as harbingers of doom for the market – headline-grabbing clickbait. Yes, sales are down over 16 percent, but of course they are. If you look at the rapid and unsustainable rise in sales in 2021, it’s no wonder that 2022’s sales were down over the year before. And thank goodness that happened. This state doesn’t have the inventory available to maintain that level of demand.
Sales were down every month last year over 2021. In the first three months of the 2022, sales were similar to 2020 before the start of the pandemic, though it was still a slow winter with all things considered. Spring came and from April to June sales were again, lower than 2021 but much higher than 2020, making up a bit for lost time. Then mortgage interest rates started to rise and sales fell compared to 2021 and 2020 as buyer affordability diminished with each basis point increase in rates.
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