East Boston Real Estate Investment Spotlight: The Pacer Luxury Condos
[This is Part 2 in a series. In case you missed Part 1, click to read: Part 1: Location of The Pacer | Leading The Way at Suffolk Downs]
The Pacer | East Boston Luxury Condos
The Pacer is a 38 unit new construction, amenity filled, elevator condo building that CHARLESGATE is exclusively marketing for sale in one of the hottest condo markets in the city, East Boston!
The Pacer offers one of the best investment opportunities in East Boston, and the entire greater Boston real estate market in the foreseeable future for a multitude of reasons.
In this three part series we will highlight different aspects of what makes this building such a great investment opportunity. Our first installment of this blog series discussed why the location of this development makes it such a great investment opportunity: Unbeatable East Boston Real Estate Investment Opportunity at The Pacer. We also have an article explaining why the building is called The Pacer: The Pacer: Brand New East Boston Condos.
With prices starting at $449,000 for remaining condos available, there are one, two, three, and four bedroom units available for purchase. We invite savvy homebuyers and investors who recognize the opportunity to book a tour today.
7 Current Market Trends Making The Pacer an Unbeatable Real Estate Investment Opportunity in East Boston
In the second part of this series, we will discuss the following MARKET CONDITIONS that make condos in this building such a great investment opportunity.
1. SPECIAL MORTGAGE PROGRAM AT THE PACER & ATTRACTIVE Interest RATES
For anybody who has been following the real estate market as of late you know that interest rates are still at historic all-time lows. The 30 year fixed mortgage rate is currently a spec above 3%, which has been an unheard of low up until the past year. Why does this matter you ask? Well, a lower interest rate on a mortgage lowers a buyer’s monthly payment and allows for a potential increase in buying power. In layman’s terms, lower interest rates allow for a buyer to borrow money for a mortgage cheaper. The Pacer also happens to fall in a location that qualifies for a great mortgage program (ask The Pacer sale’s team for further info) that could be worth up to $17,500.00 at closing for an owner occupant buyer in addition to a historically low interest rate.
2. Post COVID19 Trend Back to the City
Over the past year, due to the COVID19 pandemic, subsequent lockdowns, and work from home policies (among a handful of other factors), there has been a shift in the housing and rental market in the country out of dense urban settings and cities and into more suburban areas with more space. You may have read articles about how competitive the housing market has been and how homes in the suburbs are selling for $150,000 over asking with 30 offers, however, in cities, this has not been the case. The condo market in major cities, including Boston, has seen a softening due to the pandemic. In addition, the rental market in Boston has seen (in some cases) a double-digit percentage dip, incentives offered by landlords, and an unusual amount of vacancy. This all was mostly due to the uncertainty associated with the pandemic, the closing of essentially all physical college and non-essential office locations, people’s desire for more space to work from home and to accommodate more people at home during the day (including children who were doing online classes), and of course the elimination of the main reasons why people live in and in close proximity to cities (bustling downtowns with restaurants and nightlife, closer access to offices for shorter and cheaper commutes, being able to take public transportation or walk to everything you need, and of course to be in a busy vibrant area around other people).
However, in the past few months, as restrictions began to ease, offices began to open back up, people started to return to work, mass vaccinations began, schools reopened, an increase in housing inventory and the beginning of a return of sellers to the suburban real estate market, and automobile traffic beginning to pick back up, we have seen a steady flow back into the city and urban markets. It is this author’s humble opinion, that within 12 months a wave of buyers and renters will come back into the city and the pendulum of the real estate market will swing back to cities across the country.
We are seeing this start already, however, there are opportunities to be had right now before prices accelerate back upwards in these areas. People have short memories, up to March of 2020 (14 months ago), almost every condo in the city of Boston that was priced and listed properly had multiple offers on it within days. Right now is prime time to get a value in a building like The Pacer ahead of what will surely be increased demand and prices in the not so distant future. A city like Boston will come roaring back post pandemic, and this author believes it is the prudent move to get into a property now, before it does.
3. Lack of Investor Buyers
In the past 5-6 years CHARLESGATE has sold out quite a few new development buildings similar to The Pacer throughout different neighborhoods in Boston. These buildings were in some cases over 80% sold pre construction, often to a large percentage of international or out of state buyers looking to invest and diversify their portfolio in one of the strongest, blue chip, real estate markets in the world. These purchases were often cash. Due to the COVID-19 Pandemic and its subsequent restrictions, the vast majority of these buyers could not physically (due to restrictions) enter the state to buy property, were hesitant to buy units to rent out with rents down a bit along with pandemic uncertainty, or were choosing to not enter the country or state to make these types of purchases.
As rental demand comes back to the city, rents come back up, and COVID19 restrictions relax, this will be changing, but for now, this lacking portion of the buyer pool is providing a huge opportunity for local, smaller landlords or owner occupants to have a shot at a good selection of units to purchase in almost completed new construction condo products like The Pacer.
4. New Construction Pricing Trends Around New, Large Mixed-Use Developments
As was mentioned, in the past 5-6 years, CHARLESGATE has sold out quite a few buildings similar to The Pacer throughout different neighborhoods in Boston. One of the neighborhoods we have sold several condo buildings out in is Brighton ahead of the Boston Landing / New Balance Headquarters Development. Condo buildings around this development started around $500-$700 dollars a square foot (similar price point to The Pacer), as the development was formally approved and not yet coming out of the ground. Now with the development built (but still not complete), we are selling new construction condos around that area for up to $1,100 a square foot!
This same trend occurred around the Assembly Row Development in Somerville and others in the Boston Area. New construction buildings built around new large, mixed use developments see tremendous price appreciation as the development comes to fruition! The Pacer is touching the soon to be largest development in the history of Boston (and happens to be next to the train and in an area with tremendous upside as it stands). If this trend continues, owners of condos at The Pacer, will see substantial increases in the values of their condos as the massive Suffolk Downs project emerges from the ground.
5. Local Politics
The tapping of former Boston Mayor, Marty Walsh, by President Biden, to be the secretary of labor in his administration may have ripple effects in the Boston Real Estate Market. The Walsh administration was known as one of the most pro development administrations in the history of Boston and it is highly unlikely that any new Mayoral Administration will be the same to the extent the Walsh Administration was. If this is the case, new supply of market rate housing could become further restricted.
This, along with increased demand as the city opens back up, could cause prices to rise for all residential property in Boston, particularly new construction buildings. This particularly overlooked factor may make right now a fantastic opportunity to purchase a condo in a new construction building if future supply of the same is going to be restricted even further in the city.
6. Desirability of Building Amenities
The Pacer is the only elevator, fully amenitized, inland, new construction condo building to have hit the market in the last 5 years in East Boston. These types of buildings offer what urban condo buyers look for in a modern building and is projected to be what they will continue to want into the future. Amenities like a dog wash station, elevators, garages, a gym, etc. along with modern finishes, help provide what urban condo buyers are looking for in an apartment or condo to fit into their busy lifestyles.
No matter what you do to update a triple decker or older properties you cannot replicate these amenities and is why condos in these types of buildings sell for a premium throughout the city. If the trend towards people preferring to live in these types of buildings continues, this is a market factor that will help contribute to increased appreciation and resale value / return at a building like The Pacer.
7. Stage of Construction at The Pacer
From past experience with selling new construction buildings, as a building gets closer and closer to completion (and a larger percentage of buyers can see and touch fully completed units and finishes and wrap their heads around the finished product) units usually start to sell at a quicker pace, at times get multiple offers, and sell for more money as the building starts to come together as a clean and crisp, brand new finished product. Sellers also realize this and often eliminate any room for negotiation on price.
The Pacer is getting very close to being fully completed and with construction being finished off and the exterior still being worked on and landscaped, now is a great time to get a unit reserved pre-completion, before an amazing finished product is delivered and before buyers who cannot see beyond anything other than a finished product start to engage in buying units in the building.
Right now, buyers have a huge and perhaps only opportunity to capitalize on this market, this unique point of time in our lifetimes, and the opportunity to get into a new construction, condo building with these favorable conditions. The Pacer is "Leading The Way at Suffolk Downs" and we feel these market conditions along with this building’s location (among other reasons we will outline in the final installment of this blog series) make condos in this building, right now, truly a tremendous investment opportunity.