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Impact of GE HQ move to Boston on RE

 
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PostPosted: Thu Jan 14, 2016 4:18 am GMT    Post subject: Impact of GE HQ move to Boston on RE Reply with quote

Now that it appears that the GE HQ will relocate to Boston, which towns/areas do everyone think will experience the related price and availability crush on an already expensive and low-inventory market?

Thinking of moving to Boston in 2017, and looking for private day high schools. We want to avoid areas that will be likely targets for relocatees. Mass native, but 25+ years away from the scene.

TIA!
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Guest






PostPosted: Sat Jan 16, 2016 4:30 pm GMT    Post subject: Reply with quote

Wondered that myself when I saw it on the news. If the Boston Globe is right, then prices anywhere close to the city will just continue to "soar" and "skyrocket" over the next 5 years:

http://www.bostonglobe.com/business/2016/01/07/think-boston-housing-expensive-now-wait-five-years/6qTjKdarDT2AdZkpqrJWaJ/story.html?event=event25

Although I think I read somewhere that people are leaving the state and if there is another financial crisis on the horizon then who knows what will happen. The stock market had it's worse start in a new year since EVER. What does this mean for housing? It will be an interesting 2016.

Regarding housing in Boston, many are saying "It is different this time" due to low inventory, etc. Who knows. Have you seen the movie "The Big Short?" A must see. I won't ruin the ending.

As for relocatees, no idea. Private day high schools? Try a "W" town, Newton, or if you don't mind the commute, Route 2 area: Harvard, Groton, Concord.
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Richthofen



Joined: 02 Apr 2014
Posts: 68

PostPosted: Sun Jan 17, 2016 2:09 am GMT    Post subject: Reply with quote

I am reading that this means about 800 people are relocating. Given there's probably not even 800 SFH for sale inside 128, this is going to make things worse. This is a move of the corp. headquarters so I'd say maybe 100 are very well paid executives. There's lots of inventory over $1 million out there that's been on the market more than 90 days. They'll be fine, just check Brookline/Newton Redfin listings, if you've got $2 million, you can have the pick of the litter. The other 700 employees probably making between 100K and 200K are going to have to fight it out with the rest of us.
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PostPosted: Mon Jan 18, 2016 6:07 pm GMT    Post subject: Reply with quote

OP here. Thanks for your responses.

We have been considering a move to Brookline, Newton, Belmont, or one of the W towns, but especially Concord, where Concord or Middlesex would be day options. First choice is Concord Academy, but it's very competitive.

We had figured that rent would be expensive, but it would give us a year or so to figure out which location is best, and see if the market might turn, at least slightly, to the buyer's side. After hearing this news, I'm beginning to think we'd be better off finding a place to rent for longer.

One question: There was a great fuss over GE's announced move to the Seaport. But what happens to the GE Healthcare HQ in Marlborough, now that they have also announced a relocation to Chicago from the UK? I can't help but think a reduction or closure there would hit the MetroWest area hard.

To the poster who referenced The Big Short, great book and great movie! Highly recommend Liar's Poker, too.
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PostPosted: Thu Jan 21, 2016 4:44 pm GMT    Post subject: Reply with quote

Re: Another financial crisis and what might happen.

Back in 2007-2009 everyone was hoping that the financial crisis would finally burst the bubble, and homes would become affordable. That didn't exactly happen. Yes some of the working class towns in eastern MA had their share of foreclosures and short sales, but the higher echelon towns that people here would like to live in fared quite well. Prices flattened for a while, but that drop in prices never happened.
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admin
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Joined: 14 Jul 2005
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Location: Greater Boston

PostPosted: Thu Jan 21, 2016 6:48 pm GMT    Post subject: Reply with quote

Guest wrote:
Re: Another financial crisis and what might happen.

Back in 2007-2009 everyone was hoping that the financial crisis would finally burst the bubble, and homes would become affordable. That didn't exactly happen. Yes some of the working class towns in eastern MA had their share of foreclosures and short sales, but the higher echelon towns that people here would like to live in fared quite well. Prices flattened for a while, but that drop in prices never happened.


Flat nominal prices are declines when you account for inflation. I know that wasn't enough to make the "higher echelon" towns bargains, though. Also consider that the median price does not reflect a change in the mix of what is selling - the Case-Shiller index corrects for this as it chains together same-home sales, and the high tier for Boston did fall non-negligibly when the bubble burst (pre-"crisis"). This is the latest chart I have - it's old (sorry) but shows the decline:



I think another financial crisis is a risk for at least two reasons. First, the Fed has been aggressively dropping rates since the last crisis, ostensibly for stimulus. They can't repeat that now - today's federal funds rate is only 0.25% - they can't drop it from 5% to 0% again because it's practically there already. Second, more welfare for Wall Street may be politically nonviable this time. Last crisis Wall Street essentially said "bail us out or the world will collapse." It smacked of hubris and extortion but on the other hand was a real enough possibility to motivate the bailouts. The subsequent and related stimulus was structured in such a way that the largest beneficiaries were the existing wealthy and asset holders (QE blunted house price declines). Heads did not roll on Wall Street for their self created crisis - instead, and perversely, they were indirectly rewarded. The political environment might force the reaction to be different this time.

- admin
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PostPosted: Thu Jan 21, 2016 8:00 pm GMT    Post subject: Crisis Reply with quote

I trust your chart does not lie, but I really don't remember a noticeable price drop in the desirable towns around Boston.
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admin
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Joined: 14 Jul 2005
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Location: Greater Boston

PostPosted: Thu Jan 21, 2016 8:08 pm GMT    Post subject: Re: Crisis Reply with quote

Guest wrote:
I trust your chart does not lie, but I really don't remember a noticeable price drop in the desirable towns around Boston.


The chart is inflation adjusted and uses chained same-home sales. That's important because a median of say $700K two years in a row for a town can be a price drop if it buys you more house the second year (and a price increase if it buys you less). That's what the Case-Shiller index reflects.

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