After some ugly market data regarding single family and condo sales market in Massachusetts (Boston fared a little better price-wise than the state - for Q1 Boston condo sales data, see this post on the Boston condo market and this post on the Boston luxury condo market) in the first quarter of this year there is a bright spot in the market when it comes to multifamily sales.

Ian Murphy has an article in this week's edition of Banker & Tradesman explaining how the multi-family market in Massachusetts is "booming".  From the article:

The one facet of the market that's rich with sales from reduced prices is multi-family homes, which can produce an instant cash flow for owner/occupants or investors. So while single-family homes and condos are still searching for buyers, multi-families are booming.

"The prices are obviously way down, which is creating the demand [for multi-family homes]," said Michael DiMella, managing partner at Charlesgate Realty in Boston. "It's driving people into the market, along with the low interest rates. It's giving people a very positive cash-flow investment, or a relatively inexpensive home. These people are looking at multi-families for the same price as a condo or single family elsewhere. 

"I swear, we can't even hold them on the market when we bring them on," DiMella added.

[Note to self: don't ever say "I swear" to a reporter again!]

As you can see from this data below (as presented in the article), multifamily sales are way up - both 2 family and 3 family sales:

I don't need to repeat myself here with the same analysis that was in my quote above, but I will say this - many of the multifamily sales throughout the state are in areas of heavy foreclosure activity, so prices have been really hit hard and therefore attracting many buyers, both homeowners and investors.  This is similar to what is occuring nationwide.  In a sign the market is starting to come back to life, March pending sales are up 3.5% nationally from February and up 1.6% from a year ago, with about 50% of all sales coming from foreclosed and REO (bank-owned) homes.  Similarly, multifamily home prices in Boston (and statewide) have fallen enough to push transaction volume way up. 

The single family and condo market in the Boston area showed different results in Q1 (prices and transactions were down), partially because of tight inventory in the active (lower) price ranges in many towns and also because the homes in the upper price ranges are at a standstill -  simply because credit is tighter and bargains are not as common without as many price declines in those price brackets.  As the lower end of the market start to turn over, we should start to see more transactions in the higher end from move up buyers and also from an improving economy later in the year.  Although - this may have to be accompanied by lower prices to create some more demand.

There's been a lot of conflicting economic and real estate data recently, and because much of the data lags what is actually happening right now, conflicting data usually signals changing market dynamics coming up.  Could an economic recovery be in the cards this year with real estate following?  We'll see.....

What are your thoughts?  Comment below!

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