Left In Lowell

Housing Glut?

6 Responses to “Housing Glut?”

1. Chris Says:
   February 27th, 2006 at 2:40 pm

   I wouldn’t worry. “Glut” is a relative term. People who want their real estate values to continue rising will certainly think there’s a glut. Those who want to see housing become more affordable for people to buy will see mostly a much-needed correction. Of course the second cities like Lowell experience these housing booms and busts differently than Boston does, but I still don’t foresee too much unused stock, unless developers and owners simply don’t want to lower their prices.

2. massmarrier Says:
   February 27th, 2006 at 3:04 pm

   I’m not so sure how much of a correction we’ll have, unless twin catalysts of high interest rates and low employment forces prices down. The old wisdom was that those who are now in their 60s and older were able to speculate on the huge Boomer market’s needs. Yet, while population growth has slowed, it is still climbing. And the top realtors are still drooling and chuckling.

   I see that the huge influx of hopeful, easy-money new-comers to being realtors are leaving with curled tails. The really big, easy bucks have been made or are going to the established speculators.

   Following the big West Coast correction over a decade ago and a similar smaller one in the Boston area a bit earlier, folks have taken turns predicting an inevitable crash. The fact remains that there are enough Gen-X and Gen-Y folk with jobs who are buying house and apartment units. Absent a plague, that’ll continue.

   The speed and greed of growth have certainly slowed. A corrective dip would be very helpful for the lower middle class and maybe the working poor, but likely not permanent.

   However, we need new, affordable stock on the market, not more instant alleged-luxury crap by the train lines sold on speculation. That’s something a decent governor and a moral president could lead toward, eh?

3. Lynne Says:
   February 27th, 2006 at 3:25 pm

   In view of Lowell’s history (I couldn’t BELIEVE it when people told me how cheap houses and condos were in Lowell in the late 90s…hell, even we could have afforded the loan on one) I think people here are more nervous than in other places. Lowell just got out of a long severe housing downturn, and then it hit a boom, partly by design, partly by the assistance of low interest rates and rising cost of housing elsewhere in MA. People started developing property around here like gangbusters.

   We could be in for a local glut, and if that happens, it’ll be pretty devestating as far as I can tell. The city has poured so much money into developers’ residential plans here. Eggs all in one basket and all that.

4. Dick Howe Says:
   February 27th, 2006 at 10:11 pm

   Here are some statistics from the Registry of Deeds that seem to support the theory that the housing market is slowing: From February 1 to February 27, the number of deeds recorded has dropped from 176 in 2004, to 163 in 2005, to 137 in 2006. The decrease from ‘05 to ‘06 is a 16% decline. Another ominous statistic involves the number of foreclosure deeds recorded. In January and February of 2005 there were only five. For the same period this year there have been sixteen, an increase of 320%. Since tomorrow is the last day of the month, I’ll have some additional statistics to add to this thread tomorrow evening.

5. Dick Howe Says:
   February 28th, 2006 at 8:56 pm

   The number of deeds recorded for all of Middlesex County during the three month period (Dec, Jan, Feb) ending today is 8% less than the same period a year ago. The reduction in February ‘06 from February ‘05 is 11%

6. waittilnextyr Says:
   February 28th, 2006 at 9:14 pm

   An interesting discussion on tonight’s council meeting, where Councilor Broderick brought up a strategy to focus the Hamilton canal district on commercial development. That would be a good decision, although it was tempered a bit by tieing to the housing market direction. Even if the housing market started back up, the city’s strategy should be aimed at commercial development in that area.

   The housing at the Soucy site was stopped, although the DPD made some good arguments for it going forward as proposed. The fact that it is not really city money makes the payback work, as new taxes would exceed the carrying cost of borrowing over the long term. I would agree with the DPD in the discussion with councilor Elliott in that accelerating the return (via taxes) is wise despite the added cost (interest on borrowing) to the city. Even though the economics are much better than I had hypothesized, the density proposed doesn’t make this an attractive project.

   I think the original plan (some affordable housing) that was apparently rejected due to the proximity of the gas station probably made the most sense. However, when HUD pulled the plug (because of the gas station) and HOME money disappeared, the project was marginalized.

   But, with a big project like the Acre plan there will be a few losers, you just hope on the balance it is successful. After hearing the whole story, I think we could afford this one marginal project, as long as the layout and construction could achieve a reasonable density, adequate parking and some green space. I would hope a modified plan gets resurrected that will make it a go, as that may avoid any problem with State funding of the overall plan.

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