In spite of a slight seasonal drop off in the number of home sales last month, the median price for a Baltimore-area home sold during October was more than $10,000 higher than in the same month last year, according to data released Monday by an affiliate of the region's multiple-listing service.
“All jurisdictions in the Baltimore metro area experienced price gains from this time last year, though the rate of growth has flattened,” said a statement from Rockville-based RealEstate Business Intelligence LLC.
The median sales price in Baltimore and its five neighboring counties — Anne Arundel, Baltimore, Carroll, Harford and Howard — last month was $229,900. That’s 5 percent higher than October 2011, when the median home sales price across the region was $219,000.
“Generally speaking, housing has been improving in the last couple of quarters” and the October data is consistent with that trend, said Celia Chen, a housing economist with Moody's Analytics.
The median sales price last month in Anne Arundel County was up 8.7 percent from October 2011, to $299,000. In Baltimore City, the average sales price rose 16.6 percent, to $96,800. Baltimore County's figure was up 3.6 percent, to $202,050. Carroll County saw an increase of 5.8 percent, to $256,055. Harford County experienced a 2.2 percent rise, to $229,950, and Howard County saw a 5.8 percent increase, to $350,000.
“I’m seeing a slight tick up in pricing, but it’s not dramatic,” said Deborah Meushaw, vice president of the Greater Baltimore Board of Realtors.
Potential owner-occupants, especially young people, seem to be coming around to the idea that a home can be a good investment, she said. Many first time buyers had been scared off for the past few years by the housing bubble’s burst.
Vladimir Kats, a real estate agent with the Kats & Associates team at Keller Williams Realty Baltimore, said his team also is seeing a contingent of younger investor-buyers emerging. Young people who already own one home are taking advantage of low mortgage interest rates and escalating rental rates, he said, and buying an investment property.
“What I see is now I can get an investment mortgage for 4 percent and its hard not to make money on those type of investments,” said Kats, who specializes in distressed property transactions.
Though Baltimore-area home sales normally drop off as the temperature cools, the number of closed home sales in metro Baltimore dropped by fewer than 100 properties between September and October, RBI said. There were 1,967 residences sold last month, compared to 2,055 in September.
And October’s new contract activity was up 7.5 percent from September — double the normal rate for the past 10 years. There were 2,602 units put under contract in October in Greater Baltimore.
“The increase could be partially due to the mild temperatures experienced for much of October,” RBI said.
Both the number of closed sales and new contracts in October showed substantial improvement in a year-over-year comparison. The closed sales number in October was 22 percent higher than in October 2011. (Still, last month’s closed sales number remained nearly 500 units below the 10-year average for the month, according to RBI.) The number of new “under contracts” was up almost 18 percent year-over-year.
The inventory of homes for sale is shrinking, as homes sold or going under contract are not being replaced by new homes listed for sale.
“The inventory is definitely tighter than the same time last year,” said Kats, though it is not as limiting for buyers as this year’s spring or summer inventory, he said.
“The low inventory continues to have an impact on the market, and active listings are still shrinking relative to last year,” RBI’s statement said. “Despite the new listings it is unlikely that the region will see an influx of active listings as we close out the year. Many would-be sellers are still facing equity losses, and economic uncertainty remains a concern.”
“We definitely need more inventory,” Meushaw said.
There were 11,531 active listings in October, down from 15,349 in October 2011. There were 3,202 new listings last month, about the same as September.
“Inventories of existing homes will probably stabilize at the end of this year” as more people become comfortable with the amount their home will fetch on the market, Chen said.
The declining inventory has continued to reduce the number of days homes are spending on the market. The median number of days on the market for homes that were closed on last month in the Baltimore region was 48, “down 28 days from this time last year,” according to RBI.
Condos were particularly hot in October, making up 11.9 percent of all metro Baltimore sales. It was the condo segment's highest proportion of the market in three years, according to RBI. Condos are going to continue being a larger portion of sales in the near-term, RBI said, because “condos led all property segments in new contract growth, up 29.3 percent from this time last year.”
“I think it’s that baby boomer group” deciding to downsize that is driving the increase in Baltimore-area condo sales, said Meushaw.
There also was a 45.1 percent growth in the number of condos closed on in October, in a year-over-year comparison.
“With the exception of the condo market, sales in all property segments declined from September in line with seasonal patterns,” RBI said. Still, “townhomes and single-family home sales are up year-over-year 22.8 and 17.6 percent, respectively.”
Chen said that nationally condo sales have been fairly flat for the past year and that one month of data should be taken with a grain of salt.
“The condo market is much smaller, so it is more volatile,” Chen said. “It’s hard to read into one month’s data.”
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