Tight Inventories Drive Home Sales Down

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A shrinking inventory was blamed for the second consecutive month of declining single-family home and condominium sales, according to The Warren Group of Boston.

The Boston group said single-family homes were down 3.6-percent in March, to 3,100, compared to 3,215 in 2012. Despite the year-over-year decline, sales were higher in March than in the first two months of the year statewide. In Worcester County, single-family home sales for March dropped nearly 2.1 percent, from 437 to 428. However, Middlesex County bucked the trend, with sales rising 0.5 percent to 646.

For the first quarter, home sales across the Bay State were down 2.1 percent to 7,849 compared to the same period last year.

"Low inventory is plaguing housing markets all over the country, and Massachusetts is no exception," said David Harris, editorial director at The Warren Group. "With mortgage rates low and prices competitive, we're hopeful more sellers will emerge and the trend in dropping home sales will reverse."

Meanwhile, the median price for single-family homes was up 8 percent in March, to $285,000, The Warren Group said. A year ago, the median price was $263,000. In Middlesex County, the median price was up 5.2 percent to $367,051, and prices rose nearly 10 percent in Worcester County, with the median price reaching $211,000. March marked the sixth consecutive month that home prices increased year over year. The median selling price for the first quarter was up 10.6 percent, to $282,500.

"It's clear that the low supply of homes for sale is continuing to pressure prices," Harris said. "And there is definitely concern that such steep price spikes will cause an affordability issue."

Condo sales in March were also down compared with 2012, dropping 2 percent to 1,211. Total condo sales for the year increased almost 1 percent, to 3,083. The median price was also up more than 1.5 percent over March 2012, to $261,000.