The Cutter Report – Boston Real Estate Trends in 2013 and 2014

0
Posted March 24, 2014 by Patrick Cutter in Business
The Cutter Report March

It’s March 2014, and this is the Cutter Report. With winter creeping (ever so slowly) to an end, it’s time to take a look back at Hub sales and high performers for last year. We’ll also take a peek at the start of this year to see how sales are trending.

Looking at the Boston market as a whole, we see that from 2009 to 2013 there was a 44% increase in total sales and total market absorption swelled to nearly $2.8 billion in 2013 compared with $1.5 billion in 2009. Equally impressive, the price per square foot increased 21% in the same time span. Interesting note: all three of these data points are record setting for Boston.

8548_MP Cutter Report - Chart Number of Sales Boston Condos2014 activity is off to a strong start with price per square foot and average price at all time high. Closings at Millennium Place (which recently sold out) in the 1st quarter are strongly contributing to these averages. As for what the rest of the year will bring us, well, no new development projects larger that 50 units are closing in 2014 and inventory remains at less than 2 months.

 

Full-Service Luxury Market

Now we turn to one of the fastest growing markets in the Hub: the full-service luxury market.

8548_MP Cutter Report - Chart Number of Sales All OtherFull service luxury buildings in Boston now account for 11% (or $633 million) of all Boston sales compared with just 5% in 2009. Currently, this market is comprised of 20 luxury condo buildings, including Atelier 505, Battery Wharf, Burroughs Wharf, Belvedere, The Clarendon, Four Seasons, Grandview, Heritage on the Garden, The Intercontinental, The Mandarin, One Charles, Ritz Carlton House, Millennium Place, The Ritz-Carlton Towers 1&2, Rowes Wharf, Trinity Place, W Boston and 45 Province.

Of these, the luxury condo that had the most active 2013 was Millennium Place, with 167 sales closed last year, making up a full 42% of this market’s numbers.
Overall, the full-service luxury market appears very strong, with the average price per square foot over $1000 last year and continuing to push higher in 2014, with the average at $1026 per square foot.

 

Boston Proper $1 Million+

Like the full-service luxury market, sales for listings $1 million dollars and above grew to record numbers in 2013, representing 19% of all sales in Boston proper – an awe-inspiring 250% increase from 2009-2013. This year the trend continues to look strong, with 30% of all closings in Boston proper for the first 2 months exceeding $1 million dollars.

 

Downtown Market8548_MP Cutter Report - Chart Average Price Sq Ft

Where have most of these million-dollar sales been taking place you ask? Downtown Boston. Downtown has now exceeded Back Bay with highest median gross price point, and is truly starting to become an in-demand, high-end luxury residential destination, as evidenced by a 440% increase in total sales from 2009 to 2013.


A prime example of the residential sales energy in downtown Boston is The Ritz-Carlton towers. 2013 was a record year for resales at The Ritz-Carlton, with the highest average price per square foot, as well as the highest median gross price in the property’s history. In fact, the average price per square foot climbed 27% from 2009 to 2013.

8548_MP Cutter Report - Chart RitzCarlton Sales by Year

Why the surge? The Ritz-Carlton (also a Millennium Partners project) certainly benefited from the buzz and record-breaking sales pace at neighboring Millennium Place, but, looking at the data overall, what we’re seeing here is a swing in upward momentum for downtown as a whole, validating it as a premier luxury neighborhood emerging in Boston. 

8548_MP Cutter Report - Chart Median Gross Price v2
As we can see, this year is off to a strong start, in both the downtown and luxury real estate markets in the Hub. What will the rest of 2014 in Boston real estate look like? Leave your predictions in the comments below and come back next month for updated facts and figures in the next edition of The Cutter Report.

 

 

 


0 Comments



Be the first to comment!


You must be logged in to post a comment.