Boston Condo Market
The downtown Boston luxury condo market has certainly taken it on the chin over the last year.
The global economic and financial crisis that erupted last fall – and that we are still digging out of – put a damper on demand for high-priced condos.
First, the credit markets froze up, and in the case of jumbo loans higher-end buyers rely on, have yet to fully recover.
Then came the job losses, which cut deep into such high-paying fields such as financial services, long a mainstay of the Boston area economy and demand for luxury condos.
But after hitting the skids last year and in early 2009, there are some modest signs that demand may be starting to edge back up after hitting bottom.
First, there is the flurry of recent sales at the Bryant. The new Columbus Avenue condo development, which straddles the Back Bay and the South End, features a bevy of two-to-four bedroom, $1 million-plus units.
The project’s developers managed to sell ten units, at an average of $1.4 million, at a 30 minute auction back in October. Since then, the Bryant has sold another nine.
Combined with units already sold before the auction, a total of 30 of the Bryant’s 50 condos are now off the market.
Of course, while $1.4 million isn’t bad for an auction, it also represented a nearly 30 percent discount, on average. (The project’s marketing team, which includes former Trump executive Louise Sunshine, contends sales after the auction have weighed in at about $1,100 a square foot, well above the roughly $700 a square foot at the auction.)
But any flurry of sales in the high-end right now is notable coming after months in which this end of the condo market was virtually lifeless.
There are also signs that overall sales of $1 million-plus condos in Boston, while still at a low point, are starting to edge up again on a quarter by quarter basis.
After plunging to just 36 in the first quarter, sales of $1 million-plus condos rebounded to 64 in the second and 77 in the third, according to numbers put out by the Warren Group, publisher of Banker & Tradesman. Numbers for the fourth quarter are not out yet, but even if they simply match fourth quarter sales in 2008, it will bring the total to about 250.
That’s a far cry from the kind of sales we had been seeing before the financial market crash, which increased yearly from 364 for all of 2004 to 419 in 2008, the vast majority inked before Lehman went belly up that September.
However, the other thing to keep in mind is that the number of such deluxe units on the market in downtown Boston has increased significantly as well, from the new W Boston and Clarendon high-rises to condos back on the market at the Ritz-Carlton and the Mandarin.
Still, some sales are better than no sales if you are a luxury condo developer.
