Sales of single-family detached homes in the Boston area dropped on an annual basis in August as 1,704 units were sold compared to 1,710 units sold in August 2015, according to the Greater Boston Association of REALTORS® (GBAR). This 0.4% drop in sales remains well above the historical average of 1,461 for August and is the third highest total on record for August.

The condo market also experienced a modest decline in sales as the 1,200 condos sold last month fell short of last August's total of 1,251. A 4.1% decline, this is the eighth-highest sales total for the month and sits just short of the historical average sales total of 1,212 for the month.

Where it all began, Boston Harbor.
Where it all began, Boston Harbor.

"The market was extremely busy last month, and we did not experience the normal lull in activity as we often do in August," said GBAR President Andrew Sarno, Broker Associated with RE/MAX Andrew Realty in Medford. "We've also seen increased prices and a shrinking inventory in our region, so it is encouraging to see this amount of buyer activity despite median sales prices continuing to rise to all-time highs."

The median sales price for single-family detached homes remained stable at the all-time high monthly median price of $575,000, an 8.7% increase from the August 2015 median sales price of $528,900. Likewise, the median sales price for condos rose 9.7% from $456,000 last August to establish a new all-time record high of $499,000 in August 2016.

"Surprisingly, this continuation of record-high prices has not caused buyer confidence or activity in our region to diminish, although we are seeing a trend of some entry-level buyers being priced out," added Sarno. "Sellers should also feel confident putting their houses on the market as the inventory shortage has led to a prevalence of competitive situations and bidding wars which have kept sale prices high, indicated by the increase of homes sold at or above their original listing price."

In the single-family market, inventory dropped 28.1% from the 3,593 homes for sale in August 2015 to 2,585 last month. Similarly, the condo market inventory declined 24.9% with 1,360 condos listed last month compared to 1,811 the previous year.

Despite short supply, pending sales for both markets rose last month. Single-family pending sales increased 5.5% from 1,122 to 1,184 and pending sales for condos jumped up 11.3% to 907 from 815 last August.