When Joe Conoscenti and his wife decided to downsize this fall, they were optimistic about the chances of selling their longtime Cockeysville home, which had a good backyard, renovated kitchen and redone porch.
But even they were surprised at the swiftness of the sale. They received three offers within days of listing the property — including one above the $415,000 asking price.
"I don't know that we expected it to be that quick," said Conoscenti, 69. "It was a pretty painless experience."
Faced with limited supply of homes for sale, homebuyers are jumping on new listings, bidding up prices in a way agents said they haven't seen in years.
The median home price in the Baltimore metro region climbed to $253,000 last month, up 8 percent from October 2015, according to a new report by the ShowingTime RBI research firm. It followed a similar gain last month, and brought appreciation so far this year to about 4 percent.
Some of the gain was due to a decline in distressed sales. Those transactions represented about 16 percent of sales in October, down from nearly 22 percent in the same month last year, according to the study, which was based on data from the MRIS multiple listing service.
But prices rose for normal sales as well, with the area median climbing nearly 5 percent from October 2015 — one of the largest year-over-year gains of any month in the last three years.
"The scarcity of inventory is starting to have an effect on pricing," said T. Ross Mackesey, sales manager for Long & Foster's Greenspring Valley/Lutherville branch.
The number of listings in Baltimore City and the five surrounding counties fell to 11,958 last month, down 14 percent from a year ago, continuing a contraction in supply that started more than a year ago, the report said.
The limited supply appears to be putting the brakes on sales activity. There were 3,060 sales in October, up just 3 percent from last year — a major deceleration from the double-digit growth in sales that shaped the market in the past year.
Still that's an increase, which bodes well for supply and demand fundamentals, said Andrew Strauch, a vice president of product innovation at MRIS.
"It's kind of working the way one would think it should work," he said. "You've got the bank-mediated [homes] being cleared out, you've got more sales going into the market and then you've got decreased inventory and that's driving up prices."
Appreciation was most pronounced last month in Baltimore, where the median sales price spiked 18 percent from a year ago, to $124,000.
In Harford County the median sales price climbed to $265,000, up 15 percent year-over-year. In Carroll County, the median sales increased 9.4 percent from October 2015, reaching $314,500.
Anne Arundel County had a median sales price of $323,450, up 7 percent year over year. The median in Baltimore County was $217,500, up about 1 percent.
Howard County, the most expensive market in the region, was the only jurisdiction in which the median declined, falling 2 percent year-over-year to $380,000.
Strauch said he believes the price gains will continue, pushing values high enough to entice families that have been waiting for their home values to recover since the housing crash to sell. As inventory returns, that should help moderate the appreciation in the spring.
"I see no reason why it wouldn't continue in this pretty healthy cycle," he said.
But buyers agent John F. Sullivan, vice president of Buyer's Edge Co. Inc. said he doesn't think the appreciation is consistent enough yet to bring a flood of new sellers on the market. With a possible increase in interest rates later this year, demand could weaken further, he said.
"I don't see the low inventory being resolved until maybe next summer, if we have a sufficient increase in prices," he said. "That's not guaranteed."
Patricia Kallmyer, vice president of Coldwell Banker's Timonium office, said she thinks any hike won't be severe enough to put a damper on demand, which has been strong this year even during typically slow periods. If anything, she said, it may push more buyers to the table.
"We are very optimistic about the real estate market," she said.