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Duxbury home price appreciation - 10 year chart

By
Managing Real Estate Broker with Brad MacKenzie

Duxbury home price appreciation - 10 year chart

 

Here's a very helpful graph! It shows how Duxbury home prices climbed in the early years of the last decade, topped out in 2005, and then declined to their 2002 levels in 2010, and have remained in a narrow price band for the last three years.

What's important for homeowners to notice and, hopefully, take to heart, is that the prices home buyers paid between 2003 and 2008 were abnormally high. Even from today's price levels, the median price paid per square foot would have to increase 15-25% to begin to reach the exaggerated prices paid at the height of the boom. 

There is quite a bit of hope and anticipation that such an increase is imminent! In certain towns on the South Shore, and in certain months, there have been indications that buyers are more willing to pay higher prices. At the same time, it is very clear that homeowners who list their homes at prices above the current market are not able to sell their homes at all.

That may sound like the normal reality that overpriced homes don't sell, but what I'm driving at is that there aren't many buyers who are stepping over the line of current value and stretching into an area where they are paying more now in the hopes that future price appreciation will bail them out.

We certainly saw that kind of speculation and expectation in the middle of the last decade, when people were very willing to overpay because the house they were buying would be worth more tomorrow. In the stock market, that delusion is called the "greater fool theory": even if I am being foolish today, there will always be a greater fool who will buy from me at a higher price tomorrow. As with every other boom, the cycle ends with a bust, and some people find out, too late, that they were the greatest fool.

Today, I hope that we continue to have a strong and steady market, buttressed by reasonable Federal Reserve and lending policies, a strong economy, competent legislation on issues like flood insurance, and relatively few external shocks to the housing market. In that environment, prices should remain strong and rise slowly, giving both buyers and sellers the confidence they need to make rational, long-term decisions that benefit themselves and the economy as a whole.

Duxbury home price appreciation - 10 year chart

 

 

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Comments (8)

Noah Seidenberg
Coldwell Banker - Evanston, IL
Chicagoland and Suburbs (800) 858-7917

Brad it is starting to climb. I think 2014 will be even better and sellers will get confidence that they can get a good buck for their home and we will see more inventory.

 

Jan 28, 2014 07:36 AM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

Brad, Modest appreciation the last couple of years so maybe the market is really taking root. Locations are affected so differently across the country.

Jan 28, 2014 12:14 PM
Michael Jacobs
Pasadena, CA
Pasadena And Southern California 818.516.4393

Hi Brad -- so many things can and do happen in any ten year period.  It's interesting to see the trends in real estate over any time but certainly a decade will show many different trends.   

Jan 28, 2014 04:15 PM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Good morning Brad. I like the way the trend line is moving and hope it continues.

Jan 28, 2014 05:45 PM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Great chart that clearly demonstrates where the market has been and a glimmer of optimism for the future.

Jan 28, 2014 08:24 PM
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate Services

Brad, It was those exaggerated prices paid at the height of the boom that still cause many homeowners today to believe their home is worth more, or should be worth more. A lot has changed.  Appraisals are no longer coming back at offer prices.

Jan 29, 2014 04:30 AM
Michelle Gibson
Hansen Real Estate Group Inc. - Wellington, FL
REALTOR

Brad - I absolutely love your graph for Duxbury home prices over the last 10 years.

Jan 29, 2014 07:08 AM
Brad MacKenzie
Brad MacKenzie - Duxbury, MA
Turning Houses into Homes on the South Shore

We do need some inventory, Noah!

I hope so, Debbie.

It is interesting, and a roller-coaster ride, Michael!

Me, too, Joe!

Glimmers, Gabe, glimmers!

Agreed, KD.

Thanks, Michelle!  Me, too.

Jan 29, 2014 09:04 AM