Low inventory pushed open house attendance up in May WALTHAM, Mass.
– June 10, 2014 – The Massachusetts Association of REALTORS® (MAR) announced the results of its first monthly Future Indicators Report. The May report found that pending home sales for single-family homes had its biggest May since MAR began tracking pending home sales in January 2004. Condominiums also went up again in May compared to the same month in 2013. The REALTOR® Market and Price Confidence Indexes decreased compared to last year.
May 2014 Pending Sales:
|Single-Family ||May 2014 ||May 2013 ||% Change |
|Sales ||6,372 ||5,944 ||+7.2% |
|Median Price ||$349,000 ||$325,000 ||+7.4% |
• 15th straight month of single-family year-over-year increases.
• The most homes put under agreement in May since MAR has been tracking this data.
|Condominium ||May 2014 |
| May 2013 |
| % Change |
|Sales || 2,440 || 2,353 || +3.7% |
|Median Price || $315,000 || $290,000 || +8.6% |
The most number of condos put under agreement in May since 2005 when 2,791 units were put under agreement.
“With interest rates at their lowest point all year in May, buyer demand once again pushed pending home sales up in May,” said 2014 MAR President Peter Ruffini, regional vice president at Jack Conway & Co. “Hopefully the increase in home prices will help convince hesitant sellers to finally enter the market.”
for Historical Pending Home Sales Data
REALTOR® Market and Price Confidence Indexes:
|Confidence Index |
|May 2014 |
|May 2013 |
|% Change |
| Market || 67.73 || 83.08 || -19% |
| Price || 76.58 || 81.95 || -7.0% |
• The seventh straight month that the RMCI has gone down.
• The fourth straight month that the RMCI has been over the 60-point mark.
• The 15th straight month the RPCI was over the 70-point mark.
• Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.
“As more inventory starts to make its way to the market, REALTOR®-member confidence that prices will continue to go up isn’t as strong as it has been,” said Ruffini. “However, buyer demand is strong based on pending sales and hopefully that should start to push the REALTOR® Market Confidence Index up in the coming months.”
Monthly ‘Hot Topic’ Question:
In response to the monthly “Hot Topic” question, 55 percent of REALTORS® who responded, reported that continued low inventory had increased buyer attendance at open houses.
“We’re not surprised in these numbers,” said Ruffini. “Many REALTORS® begin the marketing process for new listings with an open house, especially when there are low inventory market conditions.”
About the Data Sets: Pending sales
- The tracking of signed purchase and sales agreements (also called “pending sales”) provide reliable information about where the real estate market is heading in coming months.
A pending sale or a sale “under agreement” is when the buyer and seller agree on the terms of the sale of a home and have a signed purchase and sale agreement, but have yet to close and be recorded as such. MAR is the only organization which compiles this statewide information from Multiple Listing Services each month.
Monthly pending (or under agreement) data and closed sales data comes from the three REALTOR®-affiliated Multiple Listing Services in Massachusetts. They are the Berkshire County Multiple Listing Service, Cape Cod & Islands Association of REALTORS® Multiple Listing Service, Inc.; and MLS Property Information Network, Inc. The data is compiled by 10K Research and Marketing, Inc. and updated each month. As a result, previous data may change after the reports have been run.
The REALTOR® Index Methodology - The Massachusetts REALTOR® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
1. How would you describe the current housing market?
2. What are your expectations of home prices over the next year?
In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
The RMCI is calculated in the following way. Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points). The results are the average score for each question. A score of 50 is the threshold between a “strong” and a “weak” condition. Similarly, the question about home prices over the next year (REALTOR® Price Confidence Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points). About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000+ members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.
### Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.