Foreclosures drag down home sales

The explosion in home foreclosures and a tightening in mortgage lending dragged down real estate prices in Massachusetts in August, a real estate research and publishing firm reported yesterday.Warren Group in Boston said median single-family home prices last month fell 4.9 percent, to $314,000, from August 2006 - the 16th consecutive month in which prices have declined. The number of sales in the period fell by 1.5 percent.
Outside of the foreclosure problems, the Massachusetts market is "very stable," Azarian said. Currently, there is about an 8-month supply of houses listed for sale, down from 9.6 months last year, he said. A smaller supply of properties for sale tends to support prices.