Hot Towns for the COLD New Construction Market
David Bates / February 13, 2012-8:49 pm
According to an analysis of census data by the Citizens’ Housing and Planning Association, the number of new home permits filed in Massachusetts in 2011, was the fewest in the 51 years the agency has been tracking them.
To get an idea of how significant the dip in new home starts was this past year, I reviewed MLS sales data for 2006 to compare it with 2011. In 2006, nearly 3,500 single family sales had been built in 2005 or after. Yet, in 2011, MLS recorded a paltry 1,863 single family sales that were built in 2010 or after. That’s a 47% drop in new home sales! As a result of the decline, the “new home” slice of the total annual single family sales had dropped from 8.2% of home sales in 2006 to 5.1% of home sales in 2011.
Although builders are reluctant to build new homes in today’s challenging economy, there are still a few Massachusetts communities where the opportunities for profit are great enough that more than one builder was willing to chance building a rogue new home or start a small new subdivision. An impromptu survey I did of MLS sales data for 2011 showed 497 MLS recorded new home sales in excess of a $600K sales price. The five most prolific communities for new home sales in this price range are listed below. Needham, not only is the champ for new home sales, but recorded more new home sales in 2011 than 2006.
Rank Town # New Sales
1. Needham 46
2. Lexington 40
3. Newton 34
4. Wellesley 29
5. Walpole 23