Would-be homebuyers faced slim pickings in the Baltimore region last month, as the number of homes on the market plunged to the lowest level in more than 10 years.
The tight inventory put a damper on purchases, while driving up prices in Anne Arundel, Carroll and Howard counties, Bright MLS, the newly formed multiple listing service for the region, reported Friday.
"We have high demand now and no supply," said JoAnn Alexander, president-elect of the Howard County Association of Realtors. "The market is not in balance."
In Howard County, the median price jumped to $377,450, up 8 percent from February 2016, even as the number of sales slumped 14 percent.
There were 2,211 sales across Baltimore City and the five surrounding counties last month, down about 2 percent from Feb. 2016, according to the analysis, which Bright MLS and its predecessor MRIS publish monthly.
The median price in the region inched up about 2 percent, or $5,000, to $230,000, extending a streak of year-over-year gains.
Gains were sharper in Anne Arundel, up 9 percent to $305,000, and Carroll, up 8 percent to $285,000.
The increased prices reflect strong demand for the homes that are available as confidence in the job market increases and families look to move before expected interest rate increases hit.
Kelly Steelman, 29, of Perry Hall said her family has been looking for a bigger home in the area for about six months and is ready to buy. But two of the three appointments they had to see homes last Sunday were cancelled over the weekend, as other buyers made offers.
"The houses that are available that we are interested in, everyone else is interested in too," Steelman said. "I guess my only hope is with the spring prime time ... approaching, that more houses are going to continue to go on the market."
So far, sellers remain on the sidelines. Active listings fell 15 percent from Feb. 2016 to 8,930, marking the 18th month in a row of year-over-year declines.
Across the metro area, new listings increased just 1 percent from Feb. 2016. They sank on a year-over-year basis even in some of the strongest markets.
"There are definitely certain areas that are getting squeezed a bit," said Andrew Strauch, vice president of product innovation and marketing for MRIS. "I would think with such huge price increases this month ... those would start pulling [sellers] in, but it's a little bit of a conundrum if it doesn't."
Maryland experienced one of the nation's most dramatic run-up in prices in the 2000s, before the housing crisis. Sellers who bought then have been cautious, waiting for prices to recover, said Cindy Ariosa, senior vice president and regional manager for Long & Foster. As baby boomers work and stay in their homes longer, that's kept some houses off the market too, she said.
But Ariosa said she's confident that more sellers will appear as the spring starts. February is typically a slow month, though relatively warm weather brought buyers out earlier than usual.
Others aren't so sure.
Some of the appreciation appearing in the monthly reports reflects falling numbers of distressed sales — still a major factor in the market, representing more than a fifth of total sales in February.
Excluding distressed sales, the median price in the metro region declined about 1 percent year-over-year last month. The median remained about 12 percent lower than the February peak of $260,000 seen in 2008.
The price gains haven't been consistent enough to bring back sellers, especially those who bought at the market's height and may still owe more than their homes are worth, Alexander said.
In Baltimore and Harford counties, median prices declined year-over-year, slipping 1 percent to $220,200 in Harford and 2 percent to $210,000 in Baltimore County.
"It's going to be a seller's market for at least another year or two," Alexander said. "Until these homes appreciate substantially enough that the seller can sell the home and at least walk away free and clear."
About 44 percent of the 201 metro areas that ATTOM Data Solutions studied in the U.S. saw record highs in home prices last year. Those included markets in Texas and in cities such as Seattle, said Daren Blomquist, senior vice president at the real estate information firm.
But he said other markets are lagging, still waiting for wage gains and household formation to heat up.
Real estate agents said demand is there, especially at more affordable price levels.
Sales in Baltimore City climbed 7 percent last month compared to Feb. 2016, even as the median price jumped 18 percent, to $98,050.
Chesca Stein, community relations manager for the credit consulting nonprofit Guidewell Financial Solutions, said the city's affordability and range of housing makes it appealing, she said. Guidewell will offer a Baltimore City homeownership workshop March 25.
"There's a house priced for your budget if I can say it in a simple way," she said.
If not, Baltimore-area buyers said they're willing to wait.
Sara Dechowitz, 32, of Lutherville, said she and her husband have spent two years looking for the right four-bedroom rancher in the school districts they want . But the options available seem overpriced, especially those that require renovation, she said.
Their starter home sold quickly this winter and the family — they recently had a second child — is now moving in with her parents in Pikesville until they find a place they like.
"My husband and I have decided we're not going to settle," she said. "We're going to take our time and make this decision so that we don't have to move again."
February 2017 median home prices by jurisdiction and increase from 2016
Howard County $377,450 + 8%
Anne Arundel County $305,000 +9%
Carroll County $285,000 +8%
Harford County $220,200 -1%
Baltimore County $210,000 -2%
Baltimore City $98,050 +18.2%