The January 2016 Boston Luxury Market Report data below is based on units sold over $700-per-square-foot, greater than $500,000 and in buildings larger than 4 units (excluding Brownstones) with central air conditioning. In addition, the ultra-luxury market from a building perspective is defined as units in the top 10% of the market on both price-per-square-foot or maximum absolute price over the defined set time period below. Based on this criteria, the following buildings were part of this data set: 10 Farnsworth, Atelier 505, The Clarendon, Four Seasons, Heritage on the Garden, Mandarin Oriental, Millennium Place, Millennium Tower, Twenty Two Liberty and Zero Marlborough.
Year-over-year (Feb – Jan), units closed and under agreement are up 37% in the luxury market. From a price perspective, pricing is up 13% in the past 3 months (Nov15 – Jan16) when compared to the same period the year prior. Typically, we see moderation in pricing during this period, but that was not the case, mainly due to the delivery of Twenty Two Liberty, during the Nov15 – Jan16 period as well as same day flips at this property.
This trend over the past year without a doubt shows the price-per-square-foot on a strong upward trend. The closing of Millennium Tower this summer will be the next one to watch and it is recorded that many of the units are under agreement for well over $1,500-per-square-foot with the PH units on the top floors getting between $2,500 – $3,000-per-square-foot. In addition, One Dalton is rumored to have units well over $2,500-per-square-foot with some approaching the $3,000-per-square-foot high water mark for larger units on higher floors including the PH.
We believe the 37% increase in UAG and Closed Units and the 13% increase in pricing is undervalued as these stats for UAG are taken from MLS and not all “new” product is recorded when it goes under agreement and could be as much as double the % increase indicated above based on “shadow sales” that are not yet reflected in data until they close and are recorded on LINK and/or MLS. In addition, the mild winter season has only added in the sales of recent luxury product in the Boston market.