The summer mortgage crisis slammed the Massachusetts housing market in September, causing sales to plunge 18.7 percent.
Single-family home sales were 3,735 last month, down from 4,593 in September 2006, according to a monthly report yesterday from Warren Group, a Boston real estate publishing firm. That was the largest decline in 12 months, when sales slid 22 percent below the previous year.
In contrast, home prices in September fell much less - 4.4 percent, to $304,000. The condominium market showed a similar pattern: Sales dropped 19.5 percent last month to 1,893, and the median price declined 3 percent, to $260,000, Warren Group said.
In a second report yesterday, by the Massachusetts Association of Realtors, home sales volume dropped 13.7 percent, but prices fell just 0.3 percent.
Meanwhile in Boston's chic downtown neighborhoods, sales and prices rose. According to Listing Information Network, sales in 12 downtown neighborhoods, including the North End, the Back Bay, and the South End, increased 5.4 percent, to 1,023 condo sales in the July-September period. The median price went up 4.55 percent, to $439,000.
"We're insulated," Link president Debra Taylor Blair said about downtown. "It's a tighter market, and we have a lot of cash buyers, and it's a market that's still relatively low in inventory. We're not getting the glut of foreclosures."
Realtors and analysts said prices are not dropping in line with sale totals because there are fewer and fewer homes on the market. Rather than selling for much lower prices, homeowners are simply not listing properties or are waiting out the downturn.
"Inventory's down because there's so much doom and gloom being projected in the newspapers it's causing people to withhold a potential sale," said Daniel Meegan, an agent in Salem and Beverly with Exit Reliance Realty. Homeowners are afraid "they won't be able to get the value they want out of their house," he said.
Meegan said house prices in individual markets remain firm. In Salem, for example, the median house price was $320,000 in the third quarter this year, up slightly from $318,333 a year ago, he said.
Doug Azarian, president of the Massachusetts Association of Realtors, said a pickup in sales of higher-priced homes this year is also shoring up median prices across the state. "It'll be interesting to see what October brings" after the steep decline in September sales, he said.
Despite September's decline, Azarian noted that overall sales in the third quarter were still the fourth highest in 27 years.
But Terry Egan, editor in chief of Banker & Tradesman and other Warren publications, called September's sales drop "significant."
"That's reflective of what's happening in the mortgage market," he said, referring to a credit crunch in July and August that made it more difficult for homebuyers to qualify for mortgages and caused a spike in interest rates for jumbo mortgages. Warren culls its data from September closings filed in court for deals that were negotiated in July and August.
In Boston and 53 cities and towns that make up Greater Boston, single-family sales fell 9.8 percent in September, while the median price rose 1 percent, to $472,750, said the Greater Boston Association of Realtors.
The Boston-area market has held up better than the rest of the state, because "our economy's stronger than the rest of the state," said John Dulczewski, the association's executive director.
Kimberly Blanton can be reached at firstname.lastname@example.org.