I'm going to put an end to speculation that the weather has anything to do with the real estate market right now. Yes it's been a terrible winter and a listing or two may be delayed by one of our routine blizzards, but that's not why inventory is so tight.
The real reason is because a segment of the market is still recovering from the bust. Really? Yes, really. Those who bought from 2006-2008 are finally starting to catch back up with the money they lost on their home's value. And once they do reach that 2006 level, it doesn't mean they're going to sell, not having built up enough equity. We know the average first-time home buyer spends a good 5-7 years on average before trading up, and our issue now is that these buyers are just not ready to.
With the afforementioned lack of inventory, coupled with low interest rates and cash buyers from Canada and China, and all of a sudden there's a mini bubble of sorts that sent some Massachusetts communities like Winchester to a 24% appreciation in one year. That's ridiculous. If you look at the MLS Q4 Economic Report from 2013, you will find that Middlesex County alone increased it's values by 7% on average.
Thankfully, interest rates are remaining low for the time being because raising them could be a huge detriment to the real estate industry as well as the economy in general. Looking back, this accounts for why experts crowned 2009 the year you wish you invested in real estate. While it's not too late to take advantage of low interest rates, 2009 saw the market bottom out and start it's climb in price.