Press Releases

Multifamily Home Sales Climb To Record Levels In Bay State During 2004

April 8, 2007

Waltham, MA - Sales of multifamily homes in Massachusetts increased for a fourth consecutive year in 2004, climbing 20.3 percent this past year from 2003, to establish a new annual record for 2-4 family home sales in the Bay State, according to data issued today by the Massachusetts Association of Realtors® (MAR). The double-digit gain in annual sales volume is the largest in a decade, dating back to 1994 when sales rose 40 percent over 1993 levels, and reflects strong demand from immigrants and first-time buyers, as well as renewed confidence in the multifamily market among investors.

In 2004, a total of 9,726 two-, three- and four-family homes were sold in Massachusetts, the most ever recorded in a single year in state history. The prior record was set just last year when 8,086 multifamily homes were sold statewide.

"The demand for multifamily homes has never been greater," stated MAR President Maggie Tomkiewicz, of m. macdonald real estate in Dartmouth. "While they don't reflect the traditional image of starter homes, duplexes and triple-deckers do provide entry-level buyers with an affordable option into the housing market, especially for single persons and young families who may benefit greatly from the additional rental income to help pay the mortgage," she explained.

Investors also are turning to the multifamily market with increasing regularity, according to industry observers. "Compared to the ups and downs in the financial markets, the housing market has offered far better returns for investors in recent years, and many are purchasing multifamily homes and turning them into condos," noted Tomkiewicz. Condo conversions have been occurring with increasing frequency in Boston, Cambridge, Worcester, and other urban markets where a shortage of land and lack of production of new single-family units has created intense demand for housing.

Regionally, sales of 2-4 family homes rose in all seven market areas of the state during the past year, with the most significant sales gains occurring in northeastern and western Massachusetts, where sales rose 40.3 percent and 28.7 percent respectively. Sales activity also increased a healthy 20 percent on Cape Cod (Barnstable County) and in greater Boston over year ago levels, and improved 10-11 percent in Worcester County and southeastern Massachusetts. Meanwhile, on the South Shore, sales were essentially flat, increasing a modest 0.5 percent between 2003 and 2004.

Not surprisingly, last year's record-setting sales pace led to a healthy increase in multifamily property values as well. While specific price comparisons are not available for two-, three- and four-family dwellings separately, the MAR report found that total dollar volume for multifamily sales increased from $2,699,162,080 in 2003 to $3,606,763,510 last year, an indication that selling prices for 2-4 family homes rose an average of 11.1 percent during the past year, from an average price of $333,807 a year ago to $370,837 in 2004.