Expansion of the Charlestown real estate market

In the 2013 year-end Boston condominium report, RESIS reported an unusually high year of sales transactions fueled by a re-sale market. New inventory was being “created” across Boston in spite of the fact that very limited new construction was occurring. This new inventory was being created in neighborhoods that have areas capable of expansion. Properties located beyond the perceived neighborhood boundary perimeters were renovated, upgraded, converted to condos, or were suddenly determined a suitable enough location due to the scarcity of inventory within the previously established neighborhood boundaries. For example, South Boston, Charlestown, and the South End were able to create new inventory by expanding the perceived borders of their respective neighborhoods.   

For example, look at the evolution of Charlestown (see image here). In 2005, condominium sales surpassing the $500,000 price point occurred primarily from the Bunker Hill Monument down throughout the Gaslight District. School Street and Bartlett Street became perceived boundary marker containing the majority of sales above $500,000. In 2013, with an abundance of buyers wanting to purchase a Charlestown condominium in combination with very scarce inventory, we see those perceived boundaries move. The corridor between Bartlett Street and Bunker Hill Street became a viable source of new inventory for the Charlestown condominium market. In addition, more buyers entered the Charlestown market by moving beyond School Street and heading towards Sullivan Square and moving beyond Bartlett Street heading towards Terminal Street and the water.  The pre-existing neighborhood boundaries couldn’t supply enough inventory to satisfy the market needs, as evidenced by the staggering 43% of sales that sold above asking price. 

In 2014 the demand for Charlestown condominium seems to be continuing. Year to date, 42% of Charlestown condominiums listed in MLS have sold above asking price. However, the bidding wars and above-asking sale prices have not pushed prices far beyond where they were last year. Instead, the average sales price remains consistent with 2013, staying steady and exactly on par with the 2013 average price of about $550,000. For more information on the Charlestown real estate market, contact RESIS.