Talk to anyone in Boston’s luxury real estate market about a potential housing bubble and they might cock their heads to the side and look at you with a confused squint, oblivious to the vulnerability the rest of us feel about our most valued asset.
Why the perplexed look? Well, first of all, Boston real estate has been enjoying a smooth uphill ride on stainless steel safety rails, while the rest of the real estate market has been meandering on a rickety old roller-coaster. Not only is there security in Boston property, but the luxury end of the market has actually set new records. To be specific, in 2015, the Mandarin Oriental took home the award placard for most per square foot when a two-bedroom condo sold for $3,880 per each little square. That sale, perhaps innocently, set our beloved town on par with other real estate giants, as well as set the tone for the massive production of all the luxury amenity high-rises we now see climbing toward the skies all around Boston.
It also made owning a piece of the nearly two square miles that comprise Boston proper (or Old Boston), a near impossibility for most of us, or at least not practical. The cost of a studio in the Back Bay (hovering around $400K) is more than the median value of a home in Massachusetts at $351,500. A luxury one-bedroom unit in the Back Bay? Expect to pay at least over a million greenbacks.
We really hope this doesn’t create any resentment amongst the suburbanites. In fact, we should all puff up our chests and feel a little bit of pride that our “scrappy” little city is now an international real estate player. Seriously, because if Boston keeps doing well, pricing out us ordinary folks, then the value of that golden real estate vine will continue to grow outward; hopefully, securing our own home values in the ‘burbs. (At least for a little bit of time.)
And it isn’t just the amenity buildings for whom the bid cards are being frantically waved in the air. Renovations of gorgeous historic buildings are firmly helping to set the footing of Boston as a major player in international real estate.
We recently toured a couple of these renovations that are garnering asking prices as high $4.7 million. Eager to learn what is driving these prices, we turned to a couple of Boston’s top real estate agents, Allison Mazer of Gibson Sotheby’s International and Jeff Hamilton of Columbus and Over (named after the street that separates the Back Bay and South End; the two neighborhoods on which the boutique firm mainly focuses). The two are co-selling a stunningly unique three-bedroom condo at 17 Gloucester Street in the Back Bay.
Priced at $3.59 million, the former attic, has an airy floor plan and is an authentic Boston space. Built in 1888, the building has a rich history, at one time serving as headquarters for the Red Cross. In the 1970’s and 80’s the gorgeous building was converted into condos. Recently renovated, this condo now has spectacular views, and the potential for a rare roof deck.
Entryway to 17 Gloucester Street
Open Floor Plan of 17 Gloucester Street. Note the exposed brick and uplifting natural light.
Two of the Bedrooms on Gloucester Street with Exposed Beams
Jeff Hamilton, one of the principals of Columbus and Over, has spent the past decade working in real estate and watching as the luxury market throttled it’s rockets, propelling it into a major lift-off. He took us to the very top of the market, er um, the roof of 17 Gloucester, to share his opinions on Boston real estate.
According to Jeff, part of what is propping up the stability of Boston’s luxury real estate market, and fueling the new amenity building development boom, is a simple banking play. International buyers are taking money out of the their local markets and investing in our secure real estate market. But, why Boston?
Simply put, Boston is special. Most spaces are finished to a designer “T,” and so this turnkey move-in is very appealing. Besides the condos’ curb appeal, Boston itself is appealing.
Honestly, Boston is just an adorable city! Why wouldn’t someone want to invest in Boston? It is walk-able with flourishing green spaces, has a magnificent history, wonderful architecture, and a well-curated and managed cultural environment. It’s also a completely approachable city. Boston is an international city, just on a manageable scale. And foreign buyers recognize this value and uniqueness and are flocking to it.
Jeff believes it is still a good time to buy in Boston. With the Mandarin as the market leader, the Clarendon keeping the pace, and the Millennium Tower soon to change the metaphoric and physical landscape, Jeff doesn’t see this slowing down. He’s bullish over the long haul and sees lots of great signals that Boston real estate values will continue to climb. Right now, on average, in the luxury market, you can still grab something for $2000 a square foot. (Yes, it is hard not to say that without tongue-in-cheek.) However, some units are pushing upward toward to $3k per square foot. That squares Boston’s shoulders with her bigger sister city, New York. Looks like little sis has caught up to her shadow, and not just in sport’s championships.
So, where to buy? Jeff points out appreciation values in the South End are outpacing those of the Back Bay by two times. He also likes areas like Dudley Square and Downtown Crossing. These are the true Boston gems.
To understand how impressive these gems are, we only need to go back to the turn of the millennium, when they were still in the rough. That’s just about when young Allison Mazer was entering the real estate game. At the time, she didn’t know she would eventually be one of Boston’s top ranking agents, finding homes for celebrity clients, most notably The Brady Family. (Yes, those Brady’s as in the legendary quarterback and uber supermodel. Yup, we give Gisele redundant superlatives.) Back then, Allison just knew she found a job she loved.
In 2000, when Allison was starting to show Boston properties, Boston was getting ready for a major scene change. The South End was a fledgling player, still considered somewhat disconnected from the main parts of Boston. The old combat zone was just starting to die a slow death, and the North End still held deep old school neighborhood roots that made it challenging for outsiders to infiltrate. And the Seaport? (Insert crying/laughing emojis.) That old shipping yard was a just a glint in a few developers’ eyes.
Much different than the Boston real estate scene we see today. And, Ms. Allison Mazer is one of the major players helping to wheel and deal these updated neighborhoods. She tells us there are now so many more options for buyers than when she first started. In fact, just recently, a home sold for $6 million in the South End. If someone listed or paid that price 16 years ago in the South End it might have caused a family intervention and prescribing some heavy medication. We can be so dramatic, because it was unthinkable. Not anymore; prices in the south end have increased somewhere around 150%!
When you first meet Allison, you can’t help but be taken with her. She has an incredible energy that most describe as sunshine, but a relaxed demeanor that makes you feel as though you’ve known her for years. Besides her winning personality, she has a work ethic that ticks like a Swiss watch; she never misses a beat. This combination is why Allison has been able to sell $120 million worth of property. Yowza!
Allison took us to one of her latest projects to give us a peek at what goes into creating these luxury condos, as well as what she loves about real estate.
Currently, the lovable Ms. Mazer is working on a major renovation on Mount Vernon Street in historic Beacon Hill. The single family home has been converted into four units. Two units are already sold, one is on the market, and another is soon to be released. The lower two duplex will have rare and stunning private yards. The upper units boast four floors of living, a private elevator, and up to three outdoor spaces!
What makes the project so special is all of the love that has gone into maintaining the charm of the original building; a new slate roof and copper details pay respect to the wonderful neighborhood’s charm. The best part? A to-die-for view. The cost for that view? Oh, about $4.7 mil. But, if we had the extra pocket change, we wouldn’t hesitate plunking it down on the table for a perpetual view of the Boston skyline.
How does Allison get all of her wheeling and dealing done while also showing properties all day long? Back in the day, to close a deal, Allison would be running to the office at all hours to fax signed paperwork. But, today, her smart phone is an invaluable tool allowing her to stay ahead of the paperwork. Allison can create offers via dotloop, schedule open houses, search MLS listings, all while giving her clients her effortless smile.
Allison is pretty enthusiastic about the Boston real estate market in general. But, watching the Seaport change over the past 16 years has been fascinating. When we asked her about trends, she told us that international students used to purchase luxury property, graduate, and then sell and move to a new city. Today, they are reinvesting in the Boston market, either as homes or investment properties. Just recently, a foreign investor scooped up over a dozen units at the new Millennium Tower. Get ’em while they’re hot seems to be the attitude.
Allison embodies The Haute Life vibe in that she has found a job she loves. She has a true passion for helping people find the home of their dreams. To her, each day holds the potential to meet someone new or for something exciting to happen. She says there is a different scenario every day, and that constant change requires energy, which keeps her motivated and invigorated.
We had a lot of fun playing with Allison at the Mount Vernon Property. But, even though she gets our policy of not taking one’s self too seriously, don’t let her playful vibe fool you. If you want a real estate deal nailed to the wall with precision and conviction, she’s the girl to hire.
Enjoy the Gallery!
Jess & Kim
Photo Credit to the Amazing Todd Mazer