Upswing Underway for Provincetown Real Estate?

The past few weeks I’ve been reporting that there are indications we could be at the bottom of the real estate slow down. The signs kept coming this week as home prices in the Northeast increased .6% in May according to the Integrated Asset Services Index. The Boston Globe reported this week that housing starts in the Northeast were up 7%. Markets that were hard hit by the recession, such as Phoenix and Southern California, reported flat activity in May. This has typically been a pre-cursor for a turnaround in the past.

The low prices and interest rates have definitely prompted buyers to act. But the government borrowing has some experts feeling inflation could be triggered and that this will cause mortgage interest rates to increase quickly. Last week, the Bankers Trade Association reported that the average 30 year fixed rate increased from 5.25 to 5.6% in a matter of days. However, activity this week shows that inflation remains in check as the yield on the 10 year treasury notes fell from an 8 month high of 4.01 last week. The Boston Globe reported more encouraging news this morning that rates adjusted to 5.38% for a 30 year fixed product as represented by Freddie Mac. Check with your mortgage broker for more specific details on mortgage products. As mortgage information changes at a daily pace, opportunity is changing.

Other positive news that could be an indicator of a turn-around is a decrease in recorded foreclosures in Massachusetts. Also, employment in Massachusetts grew by 5,000 jobs in May. This is the biggest rise since January 2008 and could be a factor in homebuyer confidence returning.

Provincetown is seeing activity. This week, offers were accepted on three condominiums. The prices ranged from $225,000 to over $800,000. Three condominiums sold this week as well and were put on record. These prices ranged from $400,000 to $600,000.

It will be interesting to watch where the rates will go, how the market continues to act and how it will impact consumer performance. Speculation that rates are on the rise or have stopped increasing will either create buying activity or scare potential buyers to sit on their hands.