Purchasing Property in Suffolk County, MA

On September 1st, The National Association of Realtors announced that pending homes sales rose for the six straight month. Similarly, existing home sales (townhomes, single family, condos, and co-ops) rose for the fourth straight month. Whether the money is there or not, obviously people want to buy! In most areas, this is probably due to falling home prices and the Federal Housing stimulus tax credit rather than an increase in household income and employment(as if!)...but that doesn't mean the well will soon run dry in all regions of the U.S.

In Suffolk County, MA, if you bought a home nine years ago you are still up $57,300(on avg.) compared with $6,800 nationally. The rate of job loss is decelerating as well. -0.5% job growth the last three years compared with -0.9% nationally. Massachusetts, as a whole' still has the highest per capita income in the country and an historical avg. of 21.7% monthly mortgage payment to income compared to 23.2% nationally. Oh, and in this past quarter of 2009, that ratio for Suffolk County, MA was 15.0%! This would explain why Suffolk County, MA has a a sub prime mortgage share of 9.6%, one of the lowest in the US, compared with 12.5% nationally. This means that if you live in Suffolk County, MA, you are more likely to have neighbors who are financially sound and probably won't be foreclosed on and those factors have a tremendous effect on the value of your home and the economic situation of the neighborhood.

The Federal Reserve Board recently extended a plan to buy back more than 1.4 trillion in distressed mortgage backed securities until the end of the 1st quarter of 2010. This transparently says that they feel the banking system is recoveringand it is not immediately necessary to buy all of these assets now. Furthermore, extending the plan will keep interest rates lower for a longer period of time which in turn will help stave off inflation.

Need yet another reason to buy now? Still think the bottom is coming? Consider this; all the data for the Commercial real estate market in Suffolk County, MA points to the formation of a bottom. Historically, the commercial real estate market lags behind the residential market. If we are seeing a bottom forming in commercial real estate, then we are probably already bouncing off our bottom on the residential side and the data in the first paragraph of this blog supports that assumption.

BUY, BUY, BUY.....bye