Massachusetts Home Sales Down 19 Percent in September;  Third Quarter Prices and Sales Also Drop, According to The Warren Group. Q3 Declines Not as Dramatic as Q2 Price and Sales Decreases.

BOSTON, Oct. 22, 2007 – Single-family home sales in September fell 18.7 percent in Massachusetts, the steepest monthly decline in a year. But the third quarter still experienced less dramatic decreases than the second quarter, according to a report released today by The Warren Group, publisher of Banker & Tradesman.

Single-family home sales fell from 4,593 in September 2006 to 3,735 in September 2007, a decrease of 18.7 percent. That drop followed a 1.5 decrease in sales in August and 1.5 percent increase in July, when compared to the same month of the previous year.

Third-quarter sales fell 5.5 percent from 15,358 in 2006 to 14,510 this year. Year-to-date sales are down 6.1 percent from 42,398 during the first nine months of 2006 to 39,805 this year.

Tightening in the mortgage market is playing a role in the decline of home sales. Jumbo mortgages – loans that exceed the limits set by Freddie Mac and Fannie Mae – are becoming less common. In September, homebuyers took out 30 percent fewer jumbo loans than in September 2006. Last year, 569 jumbo mortgages were signed during the month, while 398 were signed this year. Conventional mortgages were down 20 percent, from 5,210 to 4,248.

The median price of single-family homes has experienced steady declines this year, according to numbers calculated by The Warren Group’s traditional method, in which foreclosure deeds are included. In September, the price fell 4.4 percent from $317,900 in 2006 to $304,000. The median price in the third quarter was down 4.6 percent from $330,000 last year to $315,000. The year-to-date price also fell 4.6 percent from $330,000 to $315,000.

Because of the rapidly rising rate of foreclosures, The Warren Group has opted to also calculate data that excludes the effects of foreclosures. Using this method, the median price of single-family homes has fallen 0.9 percent year-to-date from $339,900 to $337,000.

Condominium sales also took a tumble in September, as they fell 19.5 percent from 2,353 last year to 1,893. Third quarter condo sales were down 6.4 percent from 8,121 to 7,602. Year-to-date sales have fallen 6.2 percent from 23,410 to 21,954.

The median price for condos, calculated by TWG’s traditional method, dropped 3 percent in September from $268,000 to $260,000. During the third quarter, the price fell 0.9 percent from $275,000 to $272,500, and the year-to-date median price fell 2.9 percent, from $278,000 to $270,000.

When foreclosure deeds are removed, the median year-to-date price for condos stayed flat, coming in at $280,000 in the first nine months of both 2006 and 2007.

“It appears we’re seeing in September the ramifications of July’s credit crisis,” said Timothy Warren Jr., CEO of The Warren Group. “We’re also seeing the tightening of the mortgage market; jumbo mortgages are becoming less common, whether it is because of consumer skittishness regarding mortgages that aren’t backed by Fannie or Freddie, or because it’s more difficult to qualify for such loans.

“The median price data with foreclosure deeds filtered out is encouraging, as prices are staying relatively flat. But foreclosure issues in Massachusetts can’t be ignored, and will likely get worse before it gets better.”

In Suffolk County, sales of single-family homes fell 25.2 percent in September from 131 to 98, while year-to-date sales fell 9.9 percent from 1,287 to 1,160. The median price there – calculated traditionally – fell 7.6 percent during the month from $350,000 to $323,500, and fell 5.5 percent year-to-date from $357,500 to $337,750. Condo sales in Suffolk County were down 18.1 percent in September from 513 to 420. Year-to-date sales fell 1.3 percent from 5,534 to 5,465. The median price of condos fell 4.5 percent in September from $326,000 to $311,500, while the year-to-date price decreased 1.9 percent from $340,000 to $333,500.

In Middlesex County, single-family home sales during September fell 15.5 percent from 898 to 759, while year-to-date sales are down 0.6 percent from 8,635 to 8,583. The median price of single-family homes rose 1.3 percent during September from $394,006 last year to $399,000 this year. The year-to-date price is down 2.7 percent from $415,000 to $403,900.

About The Warren Group

The Warren Group, based in Boston, is the publisher of Banker & Tradesman, The Commercial Record and a series of association publications. As the premier provider of real estate data in New England, The Warren Group offers a range of real estate products and services for professionals and consumers searching for real estate and financial information. For more information about The Warren Group, please visit www.thewarrengroup.com or call 617-428-5100.

Editorial Contacts:

Katie Curnutte
The Warren Group
280 Summer St.
Boston, MA 02210
(617) 428-5100
kcurnutte@thewarrengroup.com