A post yesterday on Business Week’s real estate blog entitled "Home price danger zones" once again cited Boston as the nation’s most vulnerable housing market, according to PMI Group’s quarterly survey of major housing markets. In the past, the good news for sellers has been that "House prices are sticky, so moving to another phase in the real estate cycle can be a slow process," as the BusinessWeek blog reports. However, that conventional wisdom comes from real estate cycles before the Internet era.
Will housing markets correct more quickly, when millions of consumers can access current market trends instantly online? No one knows yet, but there are signs that asking prices in Boston are falling faster than anticipated. Asking prices in 16 suburban towns dropped nearly 15% in recent months according to MLS stats cited in the Weston Town Crier, and a Boston real estate agent who blogs has began speculating about what would happen if prices in the city drop by 10%.
The fact that home buying plans have plunged nationwide to their lowest point in a decade and locally unsold listings are expiring at a record pace could make home prices fall more quickly, too. What’s your take? You can post your comment here, or call our reader line at 617-876-2117 to record a one to three minute sound bite that we may use as a podcast episode in our Real Estate Bubble Time Capsule.