It is not typical for our agents to be out showing properties all day during January. But this year, most of them are! In the normal seasonal flow of New England real estate, the period between Thanksgiving and the middle of February is the slowest time of year. The “January thaw” this year bodes well for the spring ahead!

What to expect in Cambridge area real estate this spring?

The mid-winter burst of activity is consistent with what we are hearing, both locally and nationally.

National:

By the middle of 2020, people who were discontent with their housing became all-the-more discontented. This should have created a lot of real estate activity. It did, but it was heavy on demand and slight on available housing. This made it hard on buyers.

Add to that, property owners who tried to move were stymied, both by that sudden increase in demand and then by climbing interest rates. If they had to end their 3% mortgage on their current house and take up a 5% mortgage on their next place, they were even more discouraged. The interest rate situation got increasingly worse, with rates at the highest seen in a generation. When people who own houses aren’t moving out because they can’t find a better situation, there is a gridlock situation that adds to the property shortage.

The expectation for 2024 is that people who were itching to move since 2020 are going to start moving. They have waited long enough and need housing that matches their life situations. 

Local:

The Boston metro area experienced the same problem with the shortage of available housing. Both rental and purchase costs have gone up at a rapid rate since 2020.

However, our area has exceptional opportunities for high-paying employment. Whereas nationally, younger buyers were shut out, here, younger buyers are a force in the buying population. The typical buyer in the Boston area was 40 years old with a household income of $147,000. 31.8% were 25-34 years old and another 26.2% were 35-44. Most moved within state, 65.8%. A large part of the housing stock, 27.2% was built before 1940. [source]

The expectation for 2024 is that rising rents are going to drive buyers back into the market this spring. 

Our anecdotal information: Listing agents who we know are saying that they are optimistic about having more properties to market for sale this spring. That is consistent with the national trend in that direction. If that comes to pass, it will be a good year for our clients.

What is a January thaw?

New Englanders with a long history of living here have witnessed the January thaw. The January thaw is the few day period when the outdoor temperatures go up into the 40s, 50s or even 60s. It is more of a shock in places where the winters are very cold. This year, the January thaw hit on January 23, right after the dusting of snow. I hope you got outside!

Although the thaw does not have a fixed time of occurrence, climatologists note the most frequent thaws occur between Jan. 19 and Jan. 28. DeGaetano said the so-called thaw is most noticeable in the eastern United States, but can be traced as far west as Missouri. [Source]