292 Massachusetts Ave, Lexington

Market Analysis for:

Linda Terry & Ken Crook

I've done a market analysis on your home at 292 Massachusetts Ave in Lexington and have prepared this document to help explain how I've arrived at a price for your home. I perform a market analysis and calculate a price taking into consideration a home’s location, size, configuration, number of bedrooms and baths, lot size and general condition. I also take into account your reported condition and how, in my experience, that will impact the price of a home making it more or less valuable. 

Contents

  1. Description of Home
  2. Market Dynamics
  3. Analysis of Relevant Properties
  4. Pricing Recommendation
  5. Marketing

Description of home

Please note that these comments do not relate to marketing, but are included purely to ensure that we have captured the information and reflect the major components of your home.

The home was built in 2013 and is a duplex condominium located on a busy street, but easy access to shops, restaurants and public transportation.  It has 3 bedrooms and 3.5 bathrooms, with a 1 car garage and is on 0.19 acres of land.  It is heated by gas fueled forced air with central air conditioning.  The home is 2280 sq ft in size which includes the finished basement.

The home is beautiful inside. As you walk in the front door you have the stairs directly in front, with the living room off to the right hand side. Tucked in the corner is a gas burning fireplace and is open plan to the kitchen. The kitchen is stunning with full height dark wood cabinets, granite counters, ceramic tile backsplash and stainless steel cabinets. There is a breakfast bar peninsula in between the kitchen and living room.  It is open to the dining room which has wainscoting surround, double windows overlooking the backyard, sliding glass doors out to the deck and patio beyond. The backyard is private and lovely. There is a half bath on the main level.

Upstairs to the second level you have a laundry room, the master bedroom with a walk in closet and attached full bathroom. The bathroom has dual sinks, ceramic floor tiles, and ceramic wall tiles around the tub/shower. A second bedroom on this level has an attached bathroom that has granite topped vanity and ceramic floor and wall tiles.

Upstairs to the third level you have a carpeted bedroom with an attached bathroom which has ceramic floor and wall tiles and corner shower.

Downstairs to the basement level you have ceramic tile floors, access to the single car garage, a carpeted family room, a semi-finished room, mudroom and cubbies.

The diagram below was sourced from public records and shows the square footage breakdown of your home.

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Market Dynamics

We have been experiencing shortages of housing inventory in Lexington over the last 5 years or so. There are always a number of buyers looking to buy in Lexington because of the strong school system, the community dynamics and vibrant downtown. People like the feeling of the downtown area, and want to stop and have a coffee, or have dinner at the many restaurants, or just watch the world go by, chatting with folks who are out and about. The Minuteman bike path and conservation areas close by pull those who desire an outdoor lifestyle while still remaining within commuting distance to Boston.

The Lexington market has seen increasing over the last few years given the limited inventory. The demand for homes in Lexington far outweighs the supply and each month a snapshot of available homes for sale shows the declining inventory levels.

Average prices in Lexington are well above average prices obtained in the peak of the market in 2005. Average condo prices have been increasing steadily since 2013. The real estate market downturn that existed for the last few years is well and truly over and prices are continuing to increase each year.

Sales distribution statistics for condos show that the $1M-$1.5M price-range is the most active in Lexington. The next busiest price range in Lexington is the $500K price range. This is an indicator that new construction is having a significant impact on the average condo prices in Lexington. 

Before reviewing the price per sq foot charts it is important to throw in a caveat of using the average as the definitive guide. There is wide variability among agents as to what is included in the living area reported in MLS. In some instances, agents will include a finished component of the basement in the living area and this is acceptable so long as how the living area is calculated is disclosed. Others report the living area reported in public record, which never includes finished areas in the basement, but note in MLS that there is a finished basement. To this end, it is important to review each individual listing to determine the ‘true’ price per sq. ft. of above ground living area, but we also need to factor into this when a home has a finished basement.

Reviewing the price per sq. foot charts for condos shows us that the average price per sq. ft. in Lexington around the $800K price range is around $461 per sq. ft. It’s important to note that the maximum price per sq. ft. achieved varies across most price ranges, along with the minimum obtained for each price range.

When the year built in the 2010’s the average price per sq. ft. is $378.

The chart below shows that condos in Lexington of similar size to your home in the 2,000 square foot range, have an average price per square foot of $363 but it increases to $412 per sq. ft. when you decrease to the 1,000 square foot range. It is common across municipalities to see an increase in the price per square foot for smaller sized homes, as it reflects the minimum cost of a home in a town irrespective of the property size.

The chart below shows how many months’ supply of inventory there is in a given price range. It uses the assumption that given the same rate of sales over the prior 12 months, and considering current inventory available for sale, how many months it should take to sell the available inventory. This is referred to “Absorption” in the real estate world. 

Any price range where there is more than 7 months’ supply, we consider there to be an oversupply of inventory, also known as a ‘buyer’s market’. Anything between 4 – 6 months is considered a balanced market. Anything less than 3 months’ supply is considered a shortage of inventory on the market at this price range, also known as a ‘sellers’ market’. As can be seen, currently, absorption rates for all condos in the $800K price range shows there is 0 month’s supply showing a severe shortage.

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Analysis of Relevant Properties

The following map shows the  homes that we believe to be of value in determining the price of your  home. Below the map you will find basic information  provided for each home including the price the home was  listed at, and the price the home sold at (if sold), the listing date, Days on market, Bedrooms, Bathrooms, living area size and lot size.  Noted for each home is a classification of Relevance which outlines whether we think the  property is valued Less (L), Relevant/Comparable (R) or Higher (H) than  your home. The notes for each home outlines the similarities and differences between  your home and the one being analyzed.

Your details: Living area 2280 sq ft | 3 beds | 3.5 baths | Built 2013 | 0.19 acres | 1 car garage

This home is smaller than your condo. It has 2,085 sq ft of total living area including a finished basement whereas your home is 2,280 sq ft in size which also includes the finished basement. This condo has the same number of bedroom as your home does, both having 3 bedrooms. Both homes also have the same number of bathrooms, having 3.5 bathrooms. This attached condo was built in a large development in 1976 while your duplex condominium was built in 2013.
As you enter through the portico, this unit is on the left having the dining room immediately accessible from the foyer. The dining room has chair rails and picture windows. It has an open floor plan to the kitchen with hardwood floors. The kitchen was renovated in 2015 and has stainless steel appliances and Viking stove, quartz countertops, wood cabinets, a wine bar with chiller, ceramic tile backsplash, and a sitting bay by the window and bar. The living room has a fireplace with brick facing and white mantel, and has an exterior access through French doors. The master bedroom is on the upper level and it has a walk in closet and an attached bathroom. Another family bedroom with a walk in closet is on this level together with a common bathroom. The finished lower level includes the family room/ bedroom.
 It has a monthly condo fee of $456 per month. It has a detached single car garage whereas you home has an attached a car garage. It is located near Wilson's Farm and is less than a mile away from your home. It was listed for $789,000 and sold for a lower price of $750,000.

Relevance: Relevant, but Less
Given the smaller size and the fact that your home is a true 3 bedroom home & family room, and the attached garage versus this homes detached garage I believe this home is relevant to your home but it will sell for less than yours.

Your details: Living area 2280 sq ft | 3 beds | 3.5 baths | Built 2013 | 0.19 acres | 1 car garage

This attached duplex home is smaller than your condo. It has 2,037 sq ft of total living area including a finished basement whereas your home is 2,280 sq ft in size which also includes the finished basement. This condo has the same number of bedroom as your home does, both having 3 bedrooms. Both homes also have the same number of bathrooms, having 3.5 bathrooms. This attached condo was built in 1880, taken down to the foundations and rebuilt in 2017 while your duplex condominium was built in 2013.
 The main level has an open floor plan with hardwood floors, and crown molding. The living room has a fireplace with granite facing, white mantel, and built in shelves on both sides. The dining area has a bay window. The kitchen has a breakfast bar island where the sink is located, granite countertops, dark lower level cabinets and white upper cabinets, stainless steel appliances, and has access to the mudroom through a French door. The upper level includes 2 family bedrooms and a shared bathroom. The master bedroom is on the 3rd level and it has an attached bathroom, and picture windows. It has gas fueled central forced air heating and central air conditioning.
It has a monthly condo fee of $150 per month. It has a detached single car garage whereas you home has an attached a car garage.
 It is located two blocks away from the Lexington Bike Path, and is near Lexington High School and the Cary Memorial Library. It was initially listed for $925,000, was cancelled and price changed a couple of times before it was sold for $829,000 after 70 days on the market.

Relevance: Relevant
Given that the home is smaller than your home and it has a detached garage, but it is not on busy Mass Ave and is walking distance to the town center I believe this home is relevant to your home.

Your details: Living area 2280 sq ft | 3 beds | 3.5 baths | Built 2013 | 0.19 acres | 1 car garage

This home is smaller than your condo. It has 1,952 sq ft of all above ground total living area whereas your home is 2,280 sq ft in size which includes the finished basement. This condo has 1 extra bedroom more as your home does, having 4 bedrooms whereas your home has 3 bedrooms. This home has a half bat less with 3 full bathrooms while your home has 3.5 bathrooms. This townhouse condo was built in 1987 and converted in 1989 while your duplex condominium was built in 2013.
The main level is on the 2nd floor which has an open floor plan on hardwood floors. The living room has brick facing and white mantel, and crown molding. The dining area has window and is connected to the kitchen through a pass through window. The kitchen has wood cabinets with glass paneled shelves, stainless steel appliances and Viking inlay fridge, granite countertops, ceramic tile backsplash, and a pantry. This level also includes 2 family bedrooms and a shared bathroom. On the 3rd floor are 2 more family bedrooms with cathedral ceiling and picture windows, and they share a bathroom. The ground level has the family room with a fireplace on bricks to the ceiling. This level has a full bathroom and an exterior access to the patio. This home has gas fueled hot water baseboard but no cooling zones.
 This home has a monthly condo fee of $109 per month. It has an attached single car garage as your home does. It is located on a small side street near Mass Ave and is only 0.6 miles away from your home. It was listed for $839,000 and sold for $855,000 with competition.

Relevance: Relevant
Given the smaller size, but it is all above ground living area, extra bedroom, renovated condition, superior location versus your newer construction but inferior location I believe this home is relevant to your home.

Your details: Living area 2280 sq ft | 3 beds | 3.5 baths | Built 2013 | 0.19 acres | 1 car garage

This townhouse has almost the same size as your condo. It has 2,232 sq ft of all above ground total living area whereas your home is 2,280 sq ft in size which includes the finished basement. This condo has the same number of bedroom as your home does, both having 3 bedrooms. This home has fewer bathrooms with 2.5 full bathrooms while your home has 3.5 bathrooms. This townhouse condo was built in 2010 while your duplex condominium was built in 2013.
The formal areas on the main level have open floor plan, crown molding, and hardwood floors. The living room which has a fireplace with white mantel and quartz facing. The dining area is directly connected to it. The kitchen has stylish cabinets to the ceiling, modern and high end stainless steel appliances, ceramic tile backsplash, granite countertops, and triple windows. The master bedroom is also on this level and it has a cathedral ceiling, triple window, walk in closet and an attached bathroom. The master bathroom has a granite countertop, and a shower stall. The family room/loft is on the upper level together with 2 more family bedrooms. Both bedrooms have semi cathedral ceiling and they share a family bathroom with a vanity which has a granite countertop and cabinets, and a separately enclosed toilet and bath. This home has an Energy Start rated; gas fueled forced air heating and central air conditioning.
 This home has a monthly condo fee of $460 per month. It has an attached single car garage as your home does. It is located at Journeys End Condominiums which is an upscale condominium community. It was listed for $918,000 and sold for $950,000 with competition.

Relevance: Higher
Given that this condo is larger with all above ground living area, in a superior location versus your home being 3 years newer on a busy street I don't believe your home will sell for as much as this home.
Address
Asking Price
Renting Price
Relevance
Notes
9 Smith Farm Lane
$3900
$3700
$3600
$3600
R(L)
This rental is smaller than your home at 1725 sq ft of living area, with 3 bedrooms, 2.5 bathrooms. It has a 2 car garage.
425 Woburn St #48
$3600
$3600
R(L)
This rental is smaller than your home at 1500 sq ft of living area, with 3 bedrooms and 2.5 bathrooms. It has a 1 car garage.
37 Courtyard Place
$3900
$3900
R
This home is a little smaller than your home at 1980 sq ft of living area. It has 3 bedrooms and 2.5 bathrooms so it has 1 bathroom less than your home. It has 2 car garage, along with another 2 car off street parking spots.  The home was built in 2010 so is only 3 years older than your home.
6 Robinson Rd #6
$4000
$4000
H
This home is a similar size to your home at 2110 sq ft in size. It has 3 bedrooms and 3.5 bathrooms. It has 2 car garage parking along with another 3 off street parking spots. It was built in 2015 so it is newer than your home, and in a superior location.

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Pricing Recommendation

My analysis of the relevant homes outlined above suggests a final market value for your home of $810,000-$860,000.  

If you were planning on renting your home I believe you would get between $3900 - $4000 per month for your home as a rental.

Given the current market dynamics in Lexington, I would suggest  listing your home at the lower end of this price range to attract more  interest and potentially multiple offers.  If the market deems your home  to be worth more than the list price, then the price will be pushed  over the market value of your home, and sometimes well over when we get  multiple offers. You can see some examples above that came on the market  for less, and competition pushed them up to the price they sold  for. The challenge in estimating a price for a home is ‘would this home  have sold for this price if they had priced it higher?’ or was  competition the driving factor that got to this price.  Experience tells  me that competition is why they sold for what they did, so we have to  be careful with pricing. A couple of good examples of competition  pushing a price higher is 4 Gibson Rd #2 which came on the market for $839,000 and sold for $855,000, and at 10 Journeys End Lane which came on the market for $918,000 and  sold for $950,000.

When homes are  overpriced they end up sitting on the market and ultimately selling for  less than market value, whereas homes priced realistically can often  sell for well over market value. Competition is what will get us the  highest sales price. As we see time and time again, if the buyers  consider the market value of your home to be realistic in relation to  the asking price, then competition will push the price up higher and  often over the market value of the home. The challenge with overpricing  is that the buyers are very educated – they go week after week to see  homes in their price range so they KNOW what the prices are and what  ‘feels’ right.

I have to stress that these are  recommendations.  If you decided to sell your home, then we would bring  your home on the market at whatever price you deem to be appropriate.  

When  determining the right price - it all depends on your motivation and  your risk tolerance level. We know that homes that are priced at the  'strike price' will sell quicker and may generate more than one offer.   I’m an excellent negotiator and know how to push a price up if we have  the market activity. I also know that some sellers want to put their  home on for a higher price than I might recommend, which I’m willing to  do, so long as it is understood that putting the home on for more than  the majority of buyers perceive its value, could mean that your home  will have a much longer market time and sell for less than it should  have had it been priced properly out of the gate.

I DO NOT  DETERMINE THE PRICE - the market dictates the value - what a buyer is  willing to pay. My job is to make sure that you have the best market  exposure and that your home is positioned well in the market.   I do not  believe in projecting more money than I think your home will sell for  just to get your business.

My team and I know how to stage and  market your home, and I understand its value, but I can only sell it for  what the market or a buyer will pay. I strongly believe that a home  should be priced compared to the current competition, not just on what  has sold in the last six months.  At the end of the day, you will be  competing for the buyers looking for a home like yours and in the same  price range. You can do far more 'damage' to the resultant price we get  for your home if we overprice. The prospective serious buyers will see  your home within the first weekend of your home coming on the market,  and they will have seen everything else in this price range.  In other  words, the serious buyer knows what is priced well.  If they don't see  value in your home at its listing price and are not motivated to make an  offer, then they will move on and keep looking.  In times of increasing  prices, it is often hard to predict what a home will sell for, but be  assured that even if we price your home lower than what market value is  currently, market dynamics will bring the price of the home up to where  it should be.  Prospective buyers should walk in thinking the price  'feels right' and are motivated to make an offer in the short term,  rather than letting several months’ pass.

It is important to  stress the value of marketing your home to capture the highest price.   In times of low inventory, we know your home will sell by doing the  bare minimum to market it, BUT that is not going to get you the maximum  price for your home.  Key to getting the maximum price for your home is  to prepare a comprehensive marketing plan that incorporates all avenues  available to us to expose your home to the maximum number of buyers out  there looking.  Exposure, and feet in the door, is what will get you the  highest price for your home. Basic ratios help explain this.  If 10% of  the buyers who walk in your door fall in love with your home, then if  you only have 10 buyers walking in, then potentially there is only 1  buyer - if you have 100 buyers walking in your door then using the same  ratios, you will potentially have 10 buyers falling in love with your  home.  10 buyers will push the price up versus only one buyer.

 New statistics state that over 100% of potential buyers  search the web as their primary search vehicle.  Thankfully, your home  will show fabulously in photos. With historically low interest rates  likely to increase and inventory at a 7-year low, there are still homes  that do not sell in this market.  I’m making my recommendations to  ensure that you are one of the sellers who will have success in the  first month of being on the market, but optimally the first weekend.

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We look forward to working with you!   Please reach out if you have any questions at all about this market analysis or our plans to market your home! 

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