The Concord real estate market continues to offer buyers from around the globe an attractive investment option with its highly ranked schools, desirable location and historic town center. Last year was a record breaking market in terms of median selling price due to a combination of low mortgage rates, a record high stock market and a strong local economy built on a variety of diverse industries. These factors led to strong demand from relocating buyers, including international buyers, especially from China, and made our local market a challenging one for some buyers, especially those searching for an updated home priced under a million dollars.
Specifically, we have seen several intriguing dynamics affecting our market:
- The number of single families sold fell from 221 in 2016 to 196 in 2017, reverting closer to the average for the past decade. - The total number of homes available for sale on January 1st increased significantly from 29 in 2017 to 52 in 2018.
- The latest Boston Magazine school rankings placed Concord #2 overall which should lead to higher demand, especially from
buyers with school age children.
- Mortgage rates, after a recent rise, are now 4.25-4.50 % for a 30 year fixed rate loan, up almost 1.0% from lows in the mid 3’s - Increasing fears of inflation and higher interest rates have also led to a particularly volatile stock market recently
The end of 2017 also brought significant changes in the US tax code that could impact residential real estate values in local markets. Some economists have predicted a downturn in home prices in markets that have higher than average home values and property taxes due to the new limited deduction for state and local taxes and mortgage interest. Perhaps an illustration of this was the luxury real estate market in Manhattan in the fourth quarter of 2017 where average prices fell by 11% year over year and total sales volume dropped 12% to the lowest level in six years. One quarter is too small of a sample size to predict a trend but it will be interesting to see how 2018 plays out when the new tax rules officially take hold. One potential off-set to these impacts are the reduced corporate tax rates which should benefit company executives and shareholders who comprise a large number of home buyers in our area.