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Home Sales Drop But Prices Rise

Essex County saw a 7 percent decrease in home sales in February compared to a year ago as a low housing inventory across the commonwealth has created bidding wars.

Essex County home sales dropped in February—mirroring the commonwealth— which saw a drop in sales for the first time since December 2011, according to a recent report by The Warren Group, publisher of Banker & Tradesman.

Essex County saw 254 home sales in February, which was a drop from 273 home sales in February 2012, a nearly 7 percent decrease. However, year-to-date sales in Essex County are up from last year, with 517 home sales so far compared with 493 at this time in 2012.

Healthy Trend?

And in more promising news for the real estate market, median sale price in Essex County was up more than 11 percent in February 2013 compared to February 2012, with year-to-date median price up almost 5 percent.

This seems to follow a trend, especially in the North Andover area. but the market overall is strengthening.

One reason for the low home sales is low inventory. North Andover is a community in which people tend to stick around, Lisa Sevajian of RE/MAX said. Another reason is that many local homes are underwater -- with owners owing more on their mortgages than the home is worth. This would cause delays in home sales locally, as those people can't afford the financial loss they would take if they sold now but can afford their mortgages so aren't opting for short sales.

"The spring market will bring a dramatic increase in the amount of buyers that are actively looking to live here," Sevajian said. "If we have the inventory for them to purchase, prices in town will increase."

Statewide

Over the entire state, home sales dropped 5 percent in February compared to a year ago. It was the first drop since December 2011.

"Two factors caused this modest drop in February: low inventory and a comparison with a strong previous year of sales," said Timothy M. Warren Jr., CEO of The Warren Group. "Even so, I'm still hopeful for a strong spring market. As more sellers list their homes in the spring, activity will pick back up."

Median sale prices are up across Massachusetts, which Warren connected to low inventory.

"With such low inventory, we're seeing bidding wars - homes selling above the asking price," Warren said. "As prices rise, more sellers will begin to list their property which in turn pumps up sales volume."

Massachustts single-family home sales by county

Feb. 2012 Feb. 2013 % change Barnstable Feb. sales 163 182 11.66% YTD sales 416 401 -3.61% Feb median sale price $265,000 $328,000 23.77% YTD median sale price $297,500 $320,000 7.56% Bristol Feb. sales 156 177 13.46% YTD sales 336 361 7.44% Feb. median sale price $216,250 $209,700 -3.03% YTD median sale price $210,000 $220,000 4.76% Dukes Feb. sales 26 11 -57.69% YTD sales 48 22 -54.17% Feb. median sale price $556,345 $555,000 -1.14% YTD median sale price $551,250 $558,500 1.32% Essex Feb. sales 273 254 -6.96% YTD sales 493 517 4.87% Feb. median sale price $270,000 $300,000 11.11% YTD median sale price $283,000 $293,000 3.53% Middlesex Feb. sales 481 487 1.25% YTD sales 971 1,025 5.56% Feb. median sale price $330,000 $360,000 9.09% YTD median sale price $349,500 $370,000 5.87% Nantucket Feb. sales 12 19 -25% YTD sales 19 11 -42.11% Feb. median sale price $737,007 $766,500 4% YTD median sale price $765,000 $766,500 .20% Norfolk Feb. sales 285 237 -16.84% YTD sales 571 584 2.28% Feb. median sale price $325,000 $326,000 .31% YTD median sale price $325,000 $355,000 9.23% Plymouth Feb. sales 266 232 -12.78% YTD sales 495 490 -1.01% Feb. median sale price $224,450 $271,000 20.74% YTD median sale price $230,000 $260,000 13.04% Suffolk Feb. sales 75 80 6.67% YTD sales 151 166 9.93% Feb. median sale price $238,700 $333,000 39.51% YTD median sale price $245,000 $333,000 37.96% Worcester Feb. sales 323 298 -7.74% YTD sales 677 670 -1.03% Feb. median sale price $174,000 $200,000 14.94% YTD median sale price $180,000 $198,250 10.14% MASSACHUSETTS Feb. sales 2,366 2,246 -5.07% YTD sales 4,802 4,833 .65% Feb. median sale price $245,000 $275,000 12.24% YTD median sale price $250,750 $279,900 11.63%

Source: The Warren Group

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