Holliston, MA - Home Sales and Real Estate Market Report (April, 2014)

Homes For Sale in Holliston Market Report

At first glance, we see a sharp down turn in the home selling index. Does this bode ill for sellers in Holliston? Let's look:

Can’t see the chart? You can find it Here .

So, yes, we're down, but from 250 to 180 still means the market is under pressure, with sales about 5.5x the active listings. Even with April underway, the number of actives homes has barely budged, and the sales have kept trucking. $/ sq foot has softened a bit, but it's been on a real tear, and some stabilizaton was in the offing.

What should home buyers do in Holliston?

Home buyers should be aware that pricing can be difficult with so few comparisons. Houses are moving very quickly if they are well priced. Holliston no longer looks quite as inexpensive as it did a year ago.

What should home sellers do in Holliston?

Home sellers should be sure to check their competive market. Remember, buyers look in ranges. Right now, the homes for sale are evenly distributed:

200-350 5
350-450 5
450-600 6
600-800 8

But some of those homes are likely to be non-competitive with your home, and so you could be competing with only one or two homes. If you have a compelling market feature, now could be a time to get a premium!

Holliston Recent Houses For Sale and Sold Market Statistics - Raw MLS Data

  • Holliston‘s “Home Seller Index” (HSI): 181 Last Report: 249
  • There are 26 homes listed as For Sale.
  • There have been 114 houses sold in the last 6 months, and 62 homes sold in the last 3 months in Holliston.
  • The Average number of Days on Market was 86 days for just SOLD homes.
  • There is an Average Market Time of 150 days of the homes For Sale (currently for sale).
  • The amount that was paid in Dollars per Square Foot averaged $200 (vs. $204)
  • There was an Average Sold Price of $488,879 for sold homes.
  • Holliston, MA, has 0 properties advertised as lender owned or foreclosure (typically foreclosure) .
  • Holliston has 1 properties advertised as a short-sale is going to be needed by lender.

*All statistics are for Single Family Houses and based on data in MLS. Matt’s HSI is proprietary. (That means you won’t find it anywhere else. Take that, Case-Schilling!).

Matt's Top Read Real Estate Posts

How do I get rid of PMI and stop paying for it?

What is PMI?

PMI is Mortgage Insurance that is generally required on higher risk, higher leverage mortgages that protects the lender from a home owners inability to pay the mortage. I'm sure that didn't help, let's take a closer look.

A "standard" 80/20 mortgage means that the buyer is putting 20% down. So on a $300,000 house, the lender brings $240,000 in the form of a mortgage, and the buyer brings 60,000 in the form of a cash down payment. There is no PMI required on these loans, because if the buyer stops paying the mortgage, the bank is "likely" to recover ALL their money through foreclosure (the 240K), because even if they sell the hosue at a discount of 10%, or $270K - there's still plenty of money to pay the bank back. Worst case, the bank is taking only a small charge off.

In this case, the bank's risk of the buyer not paying is offset by the down payment. But not all loans require a 20% down payment, and as such, the lender/bank takes on more risk. To offset that risk, PMI exists.
PMI can add up - so figure out what levers
you need to pull when the time is right to stop that payment!

For an example, lets say that the buyer pays 5% down on the same house. Now he is only bringing 15,000, and the lender(s) are bringing 285,000. Now in this case, if the loan goes into foreclosure in the short-term, there is not enough money for the lender(s) to get paid back. Thus, they require the buyer to pay Mortgage Insurance, which will pay the bank back for any losses they sustain should the buyer fail to pay the mortgage. The buyer pays a fee - how much depends on how much they borrow, but usually around $150/month, and this protects the bank in case of default.

How do I stop paying for PMI?

Most people are pretty clear that PMI is a good thing, as it allows them to get a mortgage where otherwise they could not. And it is! But we all want to stop paying it as soon as possible. How do we do that? Well part of the solution is something that you were probably never told when you got the mortgage - how does the PMI company determine that you are at the 20% level? There are lots of ways they could do that - but don't look for them to spend a lot of money figuring it out.

Many PMI companies rely on the town's assessed value for figuring out what the house is worth. That can be a "real-time" problem, because assessed values in Massachusetts are at least 6-18 months behind the market, and worse, are not intended to be market value - they are usually comfortably below market, some times as much as 10%. That makes this number a guarantee you'll pay PMI longer than you have to, and unless the PMI company is willing to accept outside documentation - like an appraiser - It wont' be easy to prove you have your 20%.

For many people, re-financing is the most cost effective way to eliminate PMI ahead of schedule. Since the refinance will take into account a current market valuation - considerably higher than the assessed value - the 20% equity can be most quickly captured that way.

The good news is if you hit whatever metric they are measuring, they will stop chargin you on their own.

If you don't want to refinance, try to get a phone number for the PMI servicer, and find out how they calcuate your houses worth. That probably won't be easy, it's not like you get a bill from the PMI company directly. Once you have that information, you can make sure that the valuation they have is accurate, and that the PMI company is aware of the value of your house. If, for example, they are willing to accept an appraisal, you can hire an appraiser and then if the numbers support your case, send it on to the PMI company. Check first that they will accept it! Also ask if they will count any equity that you have built as part of your mortgage payments. Big surprise, the answer is often "NO" although I don't understand why they don't count it - equity is equity after all.

Do you have any other stop paying PMI suggestions? Let me know what has worked for you, and I'll expand the article.


Matt Heisler

What is 40B Zoning in Massachusetts?

40B Zoning: A Layman's Guide

40B is the set of state laws that handle much of the states affordable housing guidelines. Please note, I'm not an attorney, and you should consider this a "layman's" guide to 40B for the novice. Refer to the state website location for more detailed information.

Now that we have that disclosure out of the way, let's establish WHAT 40B is, WHY it exists, HOW it is supposed to work, and HOW it actually works today.

What is 40B Zoning?

First up: What is this crazy thing called 40B?

All towns in Massachusetts have zoning requirements. Zoning specifies, at some level of detail, where you can put certain types of buildings in that town. Industrial zoning, Commerical zoning, residential zoning are generally all seperate areas, but lately many towns (especially high density ones) have been adopting mixed-used zoning, which is complicated until you remember it basically undoes what zoning does in the first place.

In general, people don't like big changes to the towns they live in, and over time, many communities used the zoning abilities to limit what - and how much - of certain things they wanted to have in town. One of the more common problems was restrictions on high-density zoning. Developers, in general, like high-density zoning, as they can take small amounts of land and create many potential units, or purchasers, and higher profits. Neighbors, in general, dislike high-density zoning, especially if there are anticipated visual issues (blocking views, or unattractive buildings), traffic issues (more people means more cars), noise issues, and other issues. This wouldn't be a problem accept that real estate in Massachusetts is expensive relative to many places and the solution is - wait for it - high-density zoning. Makes sense right? Create enough supply and prices will stabilize, or go down.

Why do we have 40B Zoning?

The goal of 40B was to create more affordable property in Massachusetts. Whether or not you can actually create enough supply just through the creation of high-density housing is far from certain, though. To make sure that the developers actually created "affordable" housing, 40-B has a requirement to do just that - which we'll get to in a moment.

Thus, the push for 40B was born. In an attempt to create affordable housing, the state decided that if a town didn't have "enough" affordable housing, than a developer could apply to the state to overturn the towns' zoning map, and basically rezone the land that they owned to create more affordable housing. This was a huge win for developers; the one catch for 40-B for builders was that a certain percentage of the units needed to be designated as "affordable", a very complicated metric that is tied to the average houshold income in the town. There were a few town protections as well - if the town met or exceeded their affordable housing requirements on a percentage basis, than they could choose to reject any 40B proposal.

Ok, that's a mouthful. Let's make sure we got our definitions right.

Zoning: A set of regulations that define what types of building can go in a certain area, and under what restrictions.

40B: A state zoning override designed to create affordable housing.

Affordable housing: Housing that can be bought by people on the lower end of the median income of a town. Typically it is smaller in size. True affordable housing regulated at the price it can be bought and sold, and it is limited to those who have certain income guidelines as to whether or not they can purchase it. If this sounds like a complete abandonment of the free market, it's because it largely is just that.

High-denstity zoning: zoning that allows for more, smaller units in a smaller parcel of land. Creates higher density of people in an area.

There's much more to 40B, it's a large and complicated law. It was done to help developers get around local zoning boards, and create "affordable" housing for folks in each and every town in the state. But only up to a certain point.

How is 40B Zoning Supposed to Work?

The typical steps in a 40B project were supposed to go like this:

1) Developer sees town does not meet it's affordable housing requirement
2) Developer purchases land
3) Developer announces a 40-B project to the town and the state
4) State approves project
5) Developer builds and sells project.

Note, since it's a 40B project, other than keeping the town in the loop, the developer really doesn't need a lot of approvals from the town. The state runs the show.

That sounds simple and good, but, like all things political, actually pushing a 40B project through a town that doesn't want it can be expensive for the developer. Expensive enough that most developers would rather do a project with the town's approval and blessing, as that is much faster. So how it actually works in most cases today is quite different.

How does 40B Zoning Work in Practice?

In practice, the developer generally uses 40B as "leverage" to get the town to acceed to a comprimise between what 40B would offer and what the town zoning currently offers. So instead of building 60 units with 15 affordables, the builder will do 44 units with 11 affordables. By shaving units off, the developer gets faster approvals, and the town gets less density than what would happen if it went all the way through the 40B process. More importantly, town concerns about traffic and noise and all the rest can be addressed with the developer directly. Most towns now realize that fighting 40B is a losing battle, and if they want to remain in control, it is best to work with the developers instead of shutting them out.

So does 40B work?

Technically, 40B does do what it is designed to do - create affordable housing. But the devil is in the details. Here are some of the problems with affordable housing as regulated by the state.

1) Buying an affordable is often threading a needle for a buyer. Buyers must have a certain amount of income in order to afford a mortgage, but not TOO much income, or they don't qualify as requiring an affordable. In my experience, these units are hard to sell, because the scope of buyers that don't make too much and don't make too little is very, very small. The extra paperwork require doesn't help, as most affordable owners are first time buyers, and the process is more complicated.

2) Once you get in, you don't have to leave. Let's say I buy an affordable home. Two years later, I get a big promotion, bump in pay, the works. I would no longer qualify for the affordable if I had to apply today, but the application process is done. I'm already in, and they don't make you sell it just because you are no longer meeting the income guidelines. Basically that means the owners are getting very cheap housing, and they often stay longer than they need to - creating more of shortage - at the taxpayers expense.

3) Limited upside of home ownership. Before you start thinking that an affordable is the way to go, guess what? Your home is very cheap when you buy it, but you'll be giving it away when you sell it. You see, the price of the property doesn't depend on it's market value - it depends on a set of calcuations that determine what the price should be for a home of that type to be affordable. So if the town you live in sees prices rise by 10%, it could be totally possible that your affordable unit went up 1%. Or nothing. Or 3%. Obviously, one of the great wealth builders in this county is the leverage that a house can provide as an asset, but if you live in an affordable, you may not participate in that equity build up. Can values of affordable fall? Yes, they can, it all depends on the median household income levels in a town, and if they fall so will the values of the units.

Despite it's flaws, 40B (and it's cousin, 40-R) should be recognized as getting developers and town to work together - not always happily - and makes the change if not easier, a little more accepted.

A few digs at the Yankees - how Sox and Yankees stack up

Red Sox / Yankees wraps up today

I have to get my Yankee posts in early this year - I have a feeling I won't be writing any after the All-star break.

Today's game features two pitchers with a lot of promise - but for one reason or another can't seem to pitch consistantly. Nova vs. Dubront will be interesting just to see who can look sharp.

Both pitchers have runs where they look really good, and I'd like to think that Dubront will be a quality starter for a good stretch, but when he's off, he's really off (they both are), and you wonder if he just doesn't have the head for it.

As I write this, the Yankees have taken control of the series in the Bronx and are up 2-1, with the Sox hoping for a split.

The Yankees are lucky to be in this position.

I can't help but think it's going to be a LONG season for the Yankees. Their moves this winter smacked of desperation, and Cashman must feel like the little Dutch boy putting his fingers in the leaky dike - and running out of fingers. There's so many holes here, and no one seems to think that there's anything in the farm system on the way to the rescue.

I won't say I follow the Yankees farm system very closely, but all you have to do is look at the trades they've been making and see how their "top rated" prospects have worked out. The deal that immediately comes to mind is the Pineda/Montero deal, where the Yankees traded their "catcher of the future". Montero has gone on to truly been a dissappointment, and this was their top ranked prospect!! If that's at the top, what's below that? Yikes.

Anyway, this Yankees team has some great questions in front of it. Some we already have early answers on.

1) Can Mark Texeria stay healty and add thump to the lineup?
So far, NO. He's already hurt again. Yikes.

2) Can Jeter stay healthy and be productive
Fans are already grumbling about his defensive range being about half what it was in his prime. He's not going to make friends with many pitchers if he can't get to routine balls. Hitting? Health? We'll see. What we do know is the Yankees are gambling on a strong season from him for sure.

3) Is McCann the new premier backstop of the AL East?
Well, the early returns aren't good, but he'll hit more. How much more remains the question - he's supposed to be a clean-up caliber player, and that hasn't happen yet (it's early, I know.)

4) Missing A-rod?
Out of sight is out of mind, but right now an unheralded nonbody - Solarte - is turning heads with his .940 OPS. His minor league numbers suggest more like .750 is in order, which means there are going to be some bad days when he gets exposed. He's got to play everyday, so there's no where he can hide once pitchers figure out where his holes are. But the best part is A-rod will likely be back in 2015, and I can't wait for that. Really, I can't. What a MESS.

5) Alfonso Sorianio - here come the strike outs!
Tying up the DH spot is Soriano. He's been great for the Yankees, but he's so streaky - and strikes out a lot - there are going to be some long stretches with him in the line up.

6) Can Roberston make one forget about Mariano's durability and excellence?
Nope. Hurt already. Yikes.

The Yankees have paid for some bright spots, but with at least 6 or 7 quality players missing from the team, I dont' see how they can compete. One or two injuries, and 85 wins will be an achievement.

On the other hand, the Sox - dealing with some injuires of their own early on, to key players Middlebrooks and Victorino, aren't playing so hot. The pitching has been middle of the road (15 out of 30), with some solid starts and some real stinkers. The hitting can't seem to knock anybody in just yet. But it's hard not to be pretty optimistic. Boegarts looks like he belongs. Sizemore looks like his old self. Perdroia, Ortiz, Napoli are still middle of the order hitters. They are having trouble figuring out the leadoff spot, but they'll figure out something. On the pitching side, only Dubront has failed to impress, and he's got about a month before he gets sent to AAA so Workman can get his shot.

In fact, the Sox farm system is briming with replacements; relievers, starters, and hitters. I didn't even mention JBJ's good start, hitting .276 and a .380 OBP. You'll take that all day, everyday from as good a defensive center fielder as he is.

Despite all the problems, the Sox are ranked 9 on the ESPN MLB RPI. Now, it's a little early to be looking at that, but in another couple of weeks in won't be.

Bring on the Rays.