Luxury Property Values and the Rental MarketApril 1, 2017
In the last few years the demand for Boston luxury homes in the rental market has been very strong. Therefore, developers and investors have been building luxury rentals and flooding the market with high end lease properties.
Now, we see more supply than demand for luxury rentals, and units stay on the market much longer than they ever have. This also has an adverse effect on the supply of Boston luxury real estate condominiums. When the rental market is soft, the sales market reacts accordingly. The more rental units, the softer the sales market becomes.
An abundance of rental properties in any given area tend to bring down the property value for Boston luxury homes. Buyers as well as lenders tend to be hesitant to pay high prices for a property in buildings with too many rental units or areas with too many rentals properties, knowing that the value will not hold.
Although the luxury property market is very strong at the moment, the influx of rental units makes sellers watch trends in the marketplace more carefully. With the guidance of an experienced Boston luxury real estate agent, they’re able to price their homes more appropriately in relation to the marketplace. Knowing the buyers’ tendencies in this market, sellers list their Boston luxury homes NOT just “to test the market,” but to sell it.
So, the more picky buyers who opt to rent instead of buying should know that it is a GREAT time to pull the trigger and buy now. Don’t wait for 100% of your wish list, since now is the time to take advantage of the market. Contact me to find out what is available now.