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Business Real Estate The Real Estate Wonk

Area home prices continue to rise as inventory remains low

Home sales numbers released Wednesday for March offer an early indication that this spring might be the best selling season since the recession, provided that there are enough homes on the market to keep up with demand.

Last month, Baltimore-area buyers entered into more than 3,200 contracts to buy homes, the first March to surpass that mark since 2007, the year the recession began, according to data collected by Metropolitan Regional Information Systems Inc., the region's multiple listing service, and its affiliate, Real Estate Business Intelligence LLC.

The number of homes that went under contract last month was up 5.6 percent from March 2012, RBI said. Homes under contract typically sell within a few months.

While marking a return to pre-recession levels of homes going under contract, the increase is "relatively modest growth compared to most of 2012," RBI said.

A similar slowing of year-over-year growth was seen last month in the number of sales that closed.

About 2,000 homes were sold during March in Baltimore and its five surrounding counties: Anne Arundel, Baltimore, Carroll, Harford and Howard. That's a 3.3 percent increase over the number sold in March 2012.

Again, RBI calls this growth "a modest gain compared to the double-digit growth the region was experiencing for most of the second half of 2012."

The slowing of sales and new contract growth from last year may highlight "lingering uncertainty in the market," RBI said in a statement, prepared in partnership with the Center for Regional Analysis at George Mason University.

RBI attributes the slowing of sales growth to a decline in the sales of single-family detached homes, which account for more than half of the region's sales in any month. Sales of single-family homes were down 1.6 percent in March from the same month last year, while the number of condominiums and townhouses sold both grew compared with March 2012 — 20.9 percent and 5.7 percent, respectively.

"Despite the relatively slow sales growth, the low supply of inventory continues to put upward pressure on prices around the region," the statement said.

The number of homes listed during March by MRIS reached an eight-year low. There were just over 9,600 homes listed last month by MRIS, more than 20 percent fewer properties than during the same month of 2012. Those listings don't encompass some slivers of the market, including most homes sold by their owners and properties going to auction.

The low inventory helped push March's median sales price in the Baltimore area up nearly $15,000 from a year earlier, to $228,500, RBI concluded. Each of metro Baltimore's six jurisdictions saw year-over-year increases in median sales prices last month.

The median number of days a home is on the market also dropped significantly, a decrease RBI attributed to the low inventory. The median days on market declined from 88 in March 2012 to 52 last month, RBI said.

While some area real estate professionals expected inventory to grow more substantially this spring than during recent years, the number of new listings last month was below the number of new listings during March 2012.

The year-over-year decline in the number of new listings, following "six months of stability [is] further evidence of uncertainty for many would-be sellers," RBI said.

There were about 4,100 homes in metro Baltimore registered with the multiple listing service in March, down from about 4,300 in March 2012, the organization said.

On average over the past 10 years, the number of new listings has jumped about 40.4 percent from February to March. This year, the increase from month to month was 31.8 percent.

steve.kilar@baltsun.com

twitter.com/stevekilar

Copyright © 2015, The Baltimore Sun
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