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Downtown real-estate market falters

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So now we need to knock over a lot more buildings and replace them with bigger crap, right?

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Voting closed 10

I would expect a downturn in sales of condos as "investments" for offshore folks given the destabilizing rancor from DC.

I know that my husband's company just moved into downtown from fort point because prices were lower ... yet still pretty hefty.

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It seems that prices can't just keep going up forever.

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When costs get so out of line with resources, something has to give.

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Downtown is bloated with Palin-esque build baby build over-priced glass boxes in the sky. Not a wise move to keep building them when there isn't demand for luxe crap... not shocking to people who actually live in Boston. We Bostonians love our neighborhoods. Developers can't seem to grasp that.

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kept saying we need density to lower prices. We have density, the prices and real estate taxes are sky high and parking and traffic suck. And all the mouths who wanted density never invested or moved into these developments.

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Property taxes in Boston are quite reasonable. Especially if you get the residential exemption. Traffic and parking are irrelevant to people who smartly don't drive. I hear Kansas has plenty of parking and is cheap.

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Did your landlord show you his real estate tax bill?

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$10.54 per $100,000. What do you think it should be?

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It's $10.54 per $1000 assessed.

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Tax for my owner-occupied condo is ~$700 . Sure, if I was a landlord instead, taxes for the property would be ~$3,400 since the residential exemption knocks $2,719.09 off the bill currently. But a similarly priced property in a place like Billerica would be like $6,000 since Billerica's taxes are 70% higher. Since Billerica doesn't have a residential exemption, this is what you would pay regardless of whether you owner-occupy.

Basically, Boston taxes for owner-occupants. are extremely inexpensive given the cost of the property.

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Using your numbers, I have the following correction/comments:

1 - Your property is assessed at ~$322,000. That's pretty uncommon for Boston.

2 - A similar priced property in Billerica would have a property tax burden of $4,577 not $6,000. Also, $350K will buy you a decent sized house with a yard in Billerica.

3 - Your comment regarding the owner-occupied tax burden is spot on, but most properties are being assessed for well over $500,000 and therefore are still paying north of $3000 for their property tax.

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I'd rather not walk around a neighborhood that's choking with traffic.

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I never read my comments out loud when typing them so my mouth has f_ck all to do with it.

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You seem to be missing the point that prices are now softening. This indictates that supply is now starting to meet demand. Density advocates might argue the mission is being accomplished. This is how density will help - market correction.

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building more density doesn't MAGICALLY knock another 20k off the price of every unit around it the day a new building opens. it works by affecting the market, by creating a glut in inventory that sellers then have to lower their prices to move. it goes like so:

1> excess demand
2> prices rise
3> inventory built
4> is demand filled?
5> if no go to 1

6> demand filled
7> less willingness to pay high prices
8> owners must lower prices or keep empty inventory

we're moving from 6 into 7. the city could help by instituting a vacant property tax, preferably for buildings of x or y size, to discourage owners from coasting w/empty units for a while hoping for demand to peak back up while writing it off as a business loss for tax purposes.

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Fenway, Back Bay, South End are all firmly in the middle of the city where international buyers, investors buyers are more likely buy vs. say Hyde Park.

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East Boston is taking a nose dive also!!
The days of the “I’m going to sell my triple decker for $1.2 million dollars” are dwindling.
If you didn’t sell you’re triple decker in East Boston in the last 2 years , you will have to wait 10 or 20 years from now.

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Inventory is rising but prices aren't falling. Maybe you can't get $1.2M but you'll sell in a day if you drop it to $1.1M or even a bare $1M. Still a huge return if you bought for $250k 15-20 years ago.

The market rises and falls but it's highly unlikely to drop to prices not seen since the early 2010s. At best things will level off for a few years and buyers will have more options at the same price.

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My wife and I bought our first condo in 2010. We negotiated for a week and got a decent 30-year fixed rate. And the federal government was gave us $8000 tax free that didn't need to be paid back to boot! A couple of refinances later and now we rent the condo and own a house. I'd love to buy another rental property!

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Increase in inventory also means competitive rent prices.
Example: a person that bought a luxury condo at slip 65 on Eastie’s waterfront last year as an investment property may want to rent it out for for $2700 a month , now a smart renter will not spend that money on a luxury apartment on Meridian street, Trenton Street or Cottage Street , they rather get more bang for the buck.

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I think the article is only referring to residential property as it refers to condos, but it should have been clearer. Also, how are the sales of rental buildings?

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Excellent, that means the mayor's plan to bring more supply online to bring prices down is working.

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...oilent green is made out of people.

not sure why i just said that but it will eventually apply if things keep going like this

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In fact, I think the tippity top was in the spring of 2018. Mortgage rates are up. Foreign investors have slowed their buying spree. Lots of the people who wanted to move from the burbs to the city have done so. Mortgage interest isn't as deductible as it was. We'll likely see a slow drop back in the top prices for a year or so but where they'll end up is largely dependent on what happens with the economy at large.

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Perhaps the Braintree Herald will move back to town.

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