There’s more to the market than residential real estate

PITTSFIELD — Since residential real estate makes up 70 percent of our total sales, we at the Berkshire County Board of Realtors typically focus our reports on that side of the market.

But this month, we’re going to examine another sector — multifamily housing and condominium sales. They complete the picture of housing availability.

Sanda J. Carroll Real estate

Let’s start with multifamily sales, which account for 12 percent of our overall real estate transactions. In 2021 when residential homes were incredibly hard to find due to increased demand and lower inventory, we saw a spike in the number of multifamily home sales that were transacted. In the five years leading up to that peak, there were, on average, 165 multifamily sales per year, compared to 240 when multifamily sales peaked two years ago. That market did dip to 223 sales last year, but that 2021 number is still an historical high. The multifamily market accounted for $47 million in real estate sales volume last year, compared to only $25.8 million in 2020. Given that increase, the average selling prices rose proportionally from $156,659 per property in 2020 to $210,627 countywide in 2022. Multifamily home sales in south Berkshire tracked at $379,500, a much higher average selling price than the entire county averaged. Northern Berkshire sales were lower than the county average at $178,568.

The vast majority of multifamily properties are located in central Berkshire County, with over half of the countywide sales taking place in Pittsfield. Of the 147 central county sales last year, 132 were Pittsfield properties. In central Berkshire, multifamily sales volume went from $17 million sold in 2020 to $32 million sold in 2022, almost double the total sales volume, which is a very significant increase. While Pittsfield dominates the multifamily market, it is worth noting that 39 multifamily properties sold in North Adams last year, and 24 in Adams, which are the county’s next two biggest markets. The most popular multifamily property type is currently the two-family duplex. These units, on average, had 57 annual sales leading up to 2021, but peaked at almost 100 sales two years ago before settling at 73 in 2022. Two, three, and four-unit buildings represent 89 percent of the total multifamily sales market. There are few larger than four unit multifamily properties in the Berkshires, and very few go on the market. Only 17 transactions of five units or more were recorded in the Berkshire Multiple Listing Service.

WHEN THE SMALL BUY MIGHTY

Condominium sales represent 8 percent of our total real estate sales market, but at $59 million in total transactions, this segment of the market has a significant impact on the overall economy of the Berkshires. Northern Berkshire condo sales have maintained the growth they experienced during the height of the COVID-19 pandemic. But southern Berkshire sales have retracted to pre-pandemic sales rates and central Berkshire sales have fallen considerably.

While many think of South County as the primary market for condos, it should be noted that sales in that area of the Berkshires represent only 8 percent of the county’s total condominium transactions. Central Berkshire dominates the market with 52 percent of all unit sales, while northern Berkshire is at 40 percent. Last year, 157 total condominium units were sold in the Berkshires, according to the board’s figures, including 63 in the north, 82 in central Berkshire and 12 in the south (the Berkshire County Board of Realtors only tracks Realtor-assisted transactions.) The overall condo market is completely dependent on the city or town those units are located in and the availability of other housing options to satisfy buyer demand.

Condominium sales in South County slowed considerably last year compared to 2021 sales rates, but in northern Berkshire the trend was just the opposite. The 63 units that were sold in northern Berkshire last year were valued at $21 million a figure that far exceeds sales rates in prior years. But sales trends are mixed throughout the county.

In central Berkshire, the drop in condo sales last year was due to a falling market in Lenox as total dollar volume dropped from $12.5 million in 2021 to $5.6 million. Despite that drop, condo sales in Pittsfield soared. Thirty units valued at $11 million were sold in Pittsfield last year. Overall sales during the peak year of 2021 were actually higher in Pittsfield at 33, but they generated only $7.9 million in total dollar volume. Hancock is the largest condo market in the Berkshires because of the number of units located at Jiminy Peak Resort. Thirty eight units valued at $22 million were sold in Hancock in 2022, a drop from the all-time high of 44 sales in 2021, which generated $9 million in total sales. But this market continues to grow.

Back to South County. The 12 total units sold last year were lower than the total sales rates the area experienced in both 2020 and 2021, but that number is in line with sales that occurred in the years before that. The condo market held steady in Stockbridge last year, but fell considerably in Great Barrington, where the total number of units sold dropped by more than half.

In April, we’ll take a look the history of land sales, which account for 10 percent of our total transactions. We’ll also delve into smart growth and what building will look like in the years ahead to see if the potential exists for growth in the Berkshire County housing market