By Alan Burke
A rising tide can lift all the boats, but Beverly may have found a way to stay afloat even when the economic tide is mud low.
According to numbers released by the Warren Group this week, Beverly was the only community of significant size on the North Shore to see an increase in home sales last month. Lots of access to public transportation may have had something to do with that.
Elsewhere, June home sales slumped to depths last seen 17 years ago at the nadir of an earlier real estate collapse. Condos have suffered the worst. The numbers are reflected here on the North Shore with Peabody homeowners, for example, selling only 19 properties in June compared with 27 last year.
RE/MAX Advantage's Terrence Sullivan warns, however, that these sales figures are actually old news — they were probably made in April or May and recorded in June. The market has improved in recent months, he says, and will improve still more once a $300 billion real estate bailout bill is signed by the president.
It includes a $7,500 tax credit for first-time homebuyers making as much as $95,000 per year per individual. When it becomes law, Sullivan said, "A lot of people are sitting on the sidelines, and they will step into the game. ... I'm very bullish on this."
Not everyone agrees. "The problem is as bad as they say it is — if not worse," said Vinny Serino of Century 21 deAn Group. In particular, he bemoans difficulties in Peabody. Tanner City prices fell in June — from $350,000 for a median-priced home last year to $335,000 this year.
"The things that are selling are the things that are presented properly," Serino said. In other words, homes must be priced to attract buyers in a buyers' market. Otherwise, "It just sits on the market."
For a long time, Serino said, he has believed that property in Essex County has been overvalued and needed correction. But real estate agents can only guess when the correction will end.
The Warren Group figures for upscale Swampscott were percentage-wise even worse than Peabody, with sales neatly halved, from 26 in June 2007 to 13 this past June.
In fact, in every North Shore community, except those small enough that single sales could skew the numbers, prices dropped. The median cost of Danvers' homes was $393,200 during the first half of 2007. This year, the numbers have deflated to $337,000. Wenham, where the numbers are drawn from a relatively small pool, the price drop was the most jarring, from a median of $600,000 in 2007 to $450,000 over the first half of this year.
The exception to all this might be Beverly. It suffered, too, at the start of the real estate slump, and prices still reflect that. The first half of last year, the median home price was $370,000, as compared to $355,000 this year.
Yet, Beverly is one of the few communities that actually increased home sales in June, from 27 last year to 34 this year. Realtors like Katharine Pickering of Coldwell Banker might chalk that up to sensible pricing. Indeed, the median price in June 2007 was $364,500, falling to $355,500 this year.
But something else happened this spring — mainly the impact of sky-high gas prices. Pickering believes that Beverly has benefited from the fact that it has five train stations offering public transportation, courtesy of the MBTA. Sullivan doubts that the impact of $4 gas could have registered that quickly. Nevertheless, he predicts that public transportation could be an important selling point for home sales in the future.
Sullivan points out that 22 percent of mortgages in Essex County consist of subprime loans. But he cautions that cities like Lynn, Lawrence and Haverhill are where most of these can be found.
"We're not hit as hard as other places," Pickering said. "But it's been a hard year."
Loans have been hard to get. Clients come in desperate to sell at a certain price because they owe that amount on the mortgage. Often, their price is sadly unrealistic. Meanwhile, million-dollar homes are still getting multiple offers, Pickering said.
"People with money still have money," Serino said. "But they're looking to steal something." Prices near the mean, about $300,000, can sell, he said. It's the client in the middle — at $500,000 or so — who can't find a buyer and won't lower the asking price. "They don't want to give the equity back. Or they refuse to believe that prices have gone down."
"In the old days," Serino said a little wistfully, "everyone had 20 percent to put down. Good credit. And they bought a house."
Home sales on the North Shore
Community 2007 2008
Beverly June sales 27 34
YTD sales 133 120
June median price $364,500 $355,500
YTD median price $370,000 $355,000
Boxford June sales 14 6
YTD sales 45 33
June median price $540,000 $605,000
YTD median price $580,000 $590,000
Danvers June sales 27 19
YTD sales 89 70
June median price $390,000 $337,000
YTD median price $393,200 $358,450
Hamilton June #Sales 8 7
YTD sales 39 34
June median price $922,500 $431,000
YTD median price $413,000 $550,000
Ipswich June sales 12 4
YTD sales 49 34
June median price $790,000 $385,750
YTD median price $519,000 $379,500
Manchester June sales 6 11
YTD sales 24 31
June median price $672,310 $920,000
YTD median price $825,250 $710,000
Marblehead June sales 35 30
YTD sales 113 81
June median price $575,000 $546,235
YTD median price $540,000 $518,000
Middleton June sales 7 9
YTD sales 33 22
June median price $250,000 $515,000
YTD median price $450,000 $430,000
Peabody June sales 26 21
YTD sales 143 134
June median price $340,000 $370,000
YTD median price $350,000 $335,000
Salem June sales 18 10
YTD sales 90 56
June median price $299,500 $282,500
YTD median price $311,000 $303,500
Swampscott June sales 26 13
YTD sales 81 46
June median price $575,500 $485,000
YTD median price $470,000 $437,050
Topsfield June sales 7 5
YTD sales 27 19
June median price $480,000 $490,000
YTD median price $517,645 $473,000
Wenham June sales 3 5
YTD sales 21 17
June median price $705,000 $805,000
YTD median price $600,000 $480,000
Source: The Warren Group
