Half of the nation’s top 10 low-risk real estate markets are here in the Bay State, according to a new survey.
A six-month study by California-based HomeSmartReports.com found that the five areas deemed a safe investment are:
Cambridge-Newton-Framingham, Providence-New Bedford-Fall River, Essex County, Boston-Quincy, and Worcester.
Even though sales and prices have declined statewide, those metro areas have “performed well over time,” said Mike Ela, president of HomeSmartReports.com.
“So as a homebuyer, you can have more confidence in an area that has demonstrated stability – and that has minimal foreclosure exposure,” he said.
Factors evaluated in the study include area foreclosures, property flipping activity, appreciation and depreciation rates, as well as proximity to a variety of elements such as water, freeways, railroads, golf courses, highways, landfills and cemeteries. All of those factors were used to come up with a weighted score.
“What we try to do is look at the components of the market that are rarely viewed, but should be,” said Ela. “There are a lot of underlying market conditions that can adversely or positively affect value.”
‘Significant Declines’
Henry Pollakowski, a senior economist at the MIT Center for Real Estate, said he can understand why New England would be viewed as a stable area for real estate investment. Unlike some parts of the country, New England hasn’t had a flurry of new-home construction, he said.
“There are places around the country where there’s been a lot of flipping, and these are the places that have a lot of new construction,” he said. “Right now, those areas are experiencing pretty significant price declines. One thing about New England is that we don’t build a lot of housing relative to the South or Southwest or West, so there isn’t a lot of room for getting in trouble by overbuilding.”
Still, Pollakowski noted that there are some pockets within the local metro areas identified as low-risk – including Lawrence and Lowell – where price volatility is higher.
But like Ela’s company, some buyers are looking beyond unit sales and prices to make their evaluations.
Gary Rogers, an agent with RE/MAX First Realty, said many of today’s buyers are considering proximity to their jobs and public transportation, especially since gas prices have sky-rocketed.
“They’re being much more sensitive to [public transportation] access even if they’ve never taken public transportation before,” Rogers said.
