Friday, January 18, 2008

Market Madness in Bolton, Mass

Lest anyone think that the pain in the real estate market is being borne solely by sub-prime buyers in the lower echelons of the market, there is ample evidence in some upscale country towns that this is not the case.

This morning's MLS updates brought the news that an 18-month-old home in the young, up-and-coming Northwoods subdivision has been listed for $950,000, with the unusual disclaimer, "Please save everyone's time; price is nonnegotiable." What makes this case so interesting is that the current owners purchased the 6000-square-foot residence (new) for $1,082,000 in June of 2006 and purportedly poured another $200,000 into it for custom upgrades, including a fully finished lower level. The property is currently assessed for $1,036,900, and ominously, the sale is "subject to bank approval."

The market has not been kind to these sellers. They first listed their home in August, 2007, for $1,250,000, and subsequently reduced it to $1.1 million in October, finally taking it off the market just before Christmas.

There are currently 47 MLS-listed homes on the market in Bolton today, with an average asking price of $833,409. Twelve of these (about 25%) are priced at $900,000 or more. Only one home in the entire town is under contract, that that one is priced much more modestly, under $500,000.

The town's current absorption rate suggests that these upper echelon homes could linger on the market for as long two years. In the last six months, 35 MLS-listed homes were sold in Bolton, with an average sale price of $619,511. Only three of these homes were priced over $900,000, including one in the same Northwoods neighborhood, which closed in December at a reported price of $912,000, excluding buyer-paid upgrades.