NEW BEDFORD — New Bedford real estate agent Sharon Power has been in the industry for over 20 years. She has never seen the housing market as competitive as it is now — and doesn’t believe it will change.
“This market is just nuts,” Power said.
This week, Power says according to her Multiple Listing Service (MLS) there are only 110 single-family active listings from Westport to Wareham, including Lakeville, Rochester, Freetown — and only 31 listings for multi-family.
In New Bedford, there are just 54 houses on the market.
Power, who now works for Silva Reality, said that 20 years ago there would be 110 houses available, on average, in Fairhaven alone — now there are only 18 — and only five are under $500,000.
Since April 2020, Power says that market has exploded due to low interest rates and high prices. She believes with the train coming soon and Boston becoming more unaffordable, people are moving down the coast.
In Fall River, Power said many people are paying outrageous prices for multi family homes — and that it will soon start happening in New Bedford, too.
She also believes the most critical issue is high rental rates and a scarcity of affordable housing in the area. “Rents now are just astronomical,” she added.
According to RentData.com, Massachusetts has the third highest rent in the country, ranging from $976 for a two-bedroom apartment in Western Worcester County to to $2,336 for a two-bedroom unit in Boston-Cambridge-Quincy area — a 10.12% increase since 2019.
Now, because there’s a limit on places to go, Power said it makes it harder for people to buy houses because the demand is so high.
Last month, Power attended an open house in Freetown on a Sunday, and the house was sold the next day.
“We as Realtors don’t like markets like this, because it makes it difficult for a buyer to get a house and then they get discouraged,” she said. “Not all of us are loving it.”
Not much will change in 2022
Garrett Jackson, a Realtor for Century 21 Signature Properties in Dartmouth is note expecting much of a change in 2022.
“I actually think it may get worse,” he said. “It feels right now that homes are going for more and more as the days go by.”
He says he still has clients that have still been looking since late 2021.
Brett Chouinard, of South Coast Elite Real Estate, believes the market may never revert back to what it was anytime soon either.
“It’s a really crazy market with people selling their houses rapidly,” he said, adding that he has seen upward of 50 offers for a property after an open house.
“I believe that people are taking advantage who have a lot of money on hand or had access to money from stimulus funds,” Chouinard said.
“People with low incomes are taking that opportunity to go out and buy a home because they felt like they could get a lower rate and more money with cash on hand.
“People can get a 30-year loan and just pay a low mortgage for the low rate.”
However, Chouinard said they are projected to see three to four rate hikes this year. “The numbers may dramatically change,” he added.
The market is hot everywhere
According to an article in the Taunton Gazette, the national median home price has increased by roughly 30% over the last decade. And in New England, much of the region has seen a steeper climb than that.
In Massachusetts particularly, the median price of a single-family home has risen by 27.4% in just the last two years, according to recent numbers from The Warren Group, which tracks real estate data in New England.
Realtor.com is predicting a slight national deceleration in prices for next year, estimating a 2.9% increase, compared to 19.5% posted in the Case-Shiller U.S. National Home Price index from September 2020 to September 2021.
“We’re gonna see interest rates creep up a little bit, but not to the level that they were 20 years ago, in the double digits,” said Diane Arsenault, a Realtor at Jack Conway & Company.
“Then, you know, you get to the stage in your life where you just want to do something different. And I always loved dealing with people,” she said.
Arsenault said New Bedford is the newest hotspot for buyers because the city has the “ingredients that people want” when living in an urban setting.
“It also has some pockets that are further out from the center that give you a little bit more of a rural feel to it. You’re close to everything,” she said, adding that people can get a lot more house for their money in New Bedford, too.
“The only ones that really seem to sit on the market are fixer-uppers,” she said. “Houses that are pretty much ‘move-in condition’ or just need to be freshened up with a coat of paint, they’re going really quick.”
Arsenault, who sold her highest number of houses to date last year, said that she would put in a listing on a Wednesday and by Saturday night have offers in hand.
“People come in to an open house, and they’re like, ‘I’ve got my offer ready to go’ and by the next day were asking for best and final,” she said.
Last year, Arsenault and her husband downsized from their home in Marion to a condo in Mattapoisett. “We kind of have that experience that I can talk so well about,” she said.
“If you can make the investment, do it,” she said. “But, be ready to roll.”
Navigating the competition
When it comes to buying a house, there are no rules and for the most part it comes down to luck. In the beginning of the surge, potential buyers would go as far as writing “love letters” to emotionally convince their sellers to choose them — a practice that is now specifically banned on most listings.
Why they are banned:Can ‘love letters’ from home buyers perpetuate racism?
“People are waiving inspections or paying over asking price,” Power said.
“If the property does not appraise for what a buyer is willing to pay, some people have been coming up with the cash to make up that difference — they’re paying sometimes over than what the house is worth.”
Jackson says that he believes most agents tend to price homes at an attractive price point and then host an open house knowing they will get a bunch of buyers at the door.
“This huge number of buyers at the open house makes everyone there realize they are going to have a lot of competition, causing them to put forward their highest and best offer right away,” he said.
He says agents will also put an expiration date for when offers are due, creating a sense of urgency. “People realize they have only one chance to submit an offer and they will have to have the highest offer out of everyone that attended the open house,” he said.
Instead, Jackson suggests looking for homes that have been on the market for a little while, then potentially offer less than asking.
Power, who had 18 transactions in 2021, tells her prospecting buyers to never get discouraged.
“You can get a house if you are persistent,” she said. “It may not be what you want, but you don’t have to settle… It may take some heartache of being outbid, but I think people will eventually get a house.”
Power will be the first to admit that she doesn’t have a “crystal ball” to predict what will happen next week. “I do think the prices are gonna stay up there, but interest rates are going up, too. In my opinion, I’m hoping that cools things down a little,” she added.
She says her best advice is people find a good buyer’s agent, a good lender and let them help you through the housing market chaos.
“If it’s meant to be, it’s meant to be.”
Standard-Times staff writer Seth Chitwood can be reached at firstname.lastname@example.org. Follow him on twitter: @ChitwoodReports. Support local journalism by purchasing a digital or print subscription to The Standard-Times today.