Market Conditions – 12 Months Into Recovery

I was talking with a client today who asked me about current market conditions and what I thought the future held.  As we talked, I discussed with them several factors that they might want to consider as they evaluate current market conditions in Annapolis, Anne Arundel County, Maryland.

First, we don’t know yet what will happen to the first-time home buyer credit, that is, whether or not the $8,000 tax credit will be extended after it expires on November 30th.  It’s anyone’s guess and uncertain as to if it will be extended.  Congress could wait and implement a new and improved credit offered in the spring of 2010.

Second, the holidays are around the corner.  Mid-November to mid-January can be a slow sales period and buyers attention turns to the holidays.  That said there is always some end-of-year activity.  And, life events (births, deaths, divorce, marriage, job changes, etc.) all lead to changes in people’s living situations (a need to buy, sell or lease homes).  So, it’s likely that there will be homes sold during this period.  But, without the tax credit stimulus, home sales might slump deeper this year that in years past since some transactions might have been pulled back into the September and October timeframe (whereas before they might have occurred later in the year).

Third, BRAC has not yet had much impact to the Annapolis real estate market.  We haven’t seen a boost in sales due to incoming service personnel assigned to Ft. Meade or an increase in sales for those supporting the military.  It may well be that these incoming service members cannot afford to buy and are renting instead or they’re just have not yet received their reassignment orders.  Either way, 2009 didn’t have a significant uptick in sales attributable to an influx of military personnel.

Four, the Washington Post carried an Associated Press news story on Thursday, October 29, 2009 stating “The economy grew at a 3.5 percent pace in the third quarter, the best showing in two years, fueled by government-supported spending on cars and homes.  The housing market also turned a corner in the summer. Spending on housing projects jumped at an annualized pace of 23.4 percent, the largest jump since 1986. It was the first time since the end of 2005 that spending on housing was positive.  The government’s $8,000 tax credit for first-time home buyers supported the housing rebound. Congress is considering extending the credit, which expires on Nov. 30.  The collapse of the housing market led the country into the recession.  Rotten mortgage securities spiraled into a banking crisis. Home foreclosures surged. The sector’s return to good health is a crucial ingredient to a sustained economic recovery.”  Furthermore the news story stated “To foster the recovery, the Fed is expected to keep a key bank lending rate at record low near zero when it meets next week and probably will hold it there into next year.”

It has been twelve months since the credit crisis impacted the availability of mortgage money.  Now a year later, buyers and sellers still are adjusting to current lending standards.  This year there have been more FHA and VA loans (56% of all mortgages in September 2009 versus 47% of all mortgages in September 2008).  Cash purchases returned to normal (about 7% of all home sales in September 2009 vs. 3% of all homes sales in September 2008).

So, what can we expect for the next couple of months?  Home sales are likely to continue for a few more weeks with last minute first-time home buyers hoping to sneak in under the wire before the seasonal slump hits.  New home starts (new construction) are likely to slow as the weather turns from a wet fall to winter.  According to the Farmer’s Almanac, the East Coast will experience average temperatures and precipitation this coming winter (while some parts of the country will experience bitter cold and above average precipitation).  Many buyers and sellers will focus on the holidays instead of buying homes.  Some sellers will put off taking their homes to market until spring and some buyers will simply wait.  In summary, well positioned properties will continue to sell throughout the winter months.

Stephen Howell handles all types of property, both for sale and for lease. Perhaps you or someone you know might be interested in purchasing or leasing home in the Annapolis area. If so, please let me know.

Has Our Real Estate Market Stabilized?

Has the local area real estate market stabilized? Now is not the seller’s market of we had in 2004 and 2005. The local area real estate market in Anne Arundel County declined slightly in July continuing the buyer’s market trend. Sale volume and sales prices were down month-over-month and year-over-year. And, since April, May and June are often the best selling months of the real estate cycle, the dog days of summer lie ahead. Economic stimulus continues to drive sales of the entry level priced homes (those between $0-500K) but hasn’t had much effect other price points. Now that August is here the local real estate market may suddenly slump.

The S&P/Case-Shiller Home Price Index for the Washington DC marketplace improved 1.3% in May. The Baltimore Metro Home Price Index for the same period declined 0.2%. The Anne Arundel County Index also declined 0.3%. And, the Annapolis Index declined 4.9% in May over April.

The total sales volume for Anne Arundel County was down 11.6% in July over June. The number of units sold was down 11.8% and the number of active listings was down 10.4%. The number of pending sales was down 7.2%. The average sold price was up slightly 0.2% from $353,284 to $354,120. There were 426 units sold in July down from 483 units sold in June.

The total sales volume for Annapolis was down 9.7% in July over June. The number of units sold was down 4.9% and the number of active listings was down 2.5%. The number of pending sales was down 32.9%. The average sold price was down 5.0% from $433.409 to $411,423. There 77 units sold in July down from 81 sold in June.

Sales activity is likely to slow in August as summer wanes and buyers and sellers alike take end-of-summer vacation. Sellers may see declining prices while buyers will benefit from low prices, low interest rates and plenty of inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

Market Assessment – Are We Past Bottom?

Are we past the bottom of the market are do we have a ways to go? Many indicators suggest that have in moved beyond the bottom of the market. Pending sales in Anne Arundel County are up month over month for the fifth month in a row. This is a very good sign. There is no guarantee that the trend will continue. As economic conditions improve buyers who were once sidelined may now be in the market looking for a new home and buyer!!! But sellers beware; August is just around the corner and is typically one of the slowest months in real estate. So it is entirely possible that the market could hit a sudden slump.

The S&P/Case-Shiller Home Price Index for the Washington DC marketplace declined 1.2% in March. The Baltimore Metro Home Price Index for the same period declined 2.0%. And the Anne Arundel County Index was up 1.4%. The Annapolis Index was also up 2.6% in March over February.

The total sales volume for Anne Arundel County was up 18.5% in May from April. The number of units sold was up 16.8% and the number of active listings was down 7.6%. The number of pending sales was up down 1.2%. The average sold price was down up 1.4% from $ $349,031 to $353,985. There were 410 units sold in May up from 351 sold in April.

The total sales volume for Annapolis was up 21.8% in May from April. The number of units sold was up 24.6% and the number of active listings was up 2.0%. The number of pending sales was down 5.1%. The average sold price was down 2.3% from $489,616 to $478,572. There 71 units sold in May up from 57 sold in April.

The quickening sales pace is likely to slow in June and July and summer begins.  Sellers may see stability in prices but buyers will continue to benefit from lower prices, low interest rates and excess inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

Market Assessment – At A Tipping Point?

Are we at a tipping point or do we still have a long way to go? Many indicators suggest that have reached a tipping point. While pending sales in Anne Arundel County were up over last month, there are still more listings coming onto the market than coming off. Overall inventory levels declined in the county, while Annapolis remains about the same level. The activity continues to be in the $0 to $499K price range. Although activity and prices remain below that of this time last year, there are signs that the market is starting to stabilize. A large inventory, low interest rates, hesitant buyers, stubborn sellers best describe current market conditions.

The S&P/Case-Shiller Home Price Index for the Washington DC marketplace declined 2.3% in February. The Baltimore Metro Home Price Index for the same period declined 0.2%. And the Anne Arundel County Index declined 1.1%. The Annapolis Index was up 4.5% in February over January.

The total sales volume for Anne Arundel County was down 14.3% in April from March. The number of units sold was down 7.4% and the number of active listings was down 5.7%. The number of pending sales was up 84.8%. The average sold price was down 7.5% from $380,072 to $351,605. There were 326 units sold in April down from 352 sold in March.

The total sales volume for Annapolis was down 5.2% in April from March. The number of units sold was down 6.6% and the number of active listings was up 0.4%. The number of pending sales was up 52.6%. The average sold price was up 1.5% from $482,453 to $489,616. There 57 units sold in April down from 61 sold in March.

The quickening sales pace is likely to continue for May, June and July.  However, it may be mid-summer before sellers see stability in sales prices. Buyers will continue to benefit from lower prices, low interest rates and excess inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

Market Assessment – Turning A Corner?

Have we turned a corner? Has the market shifted? Has spring finally arrived? Many indicators suggest that we have turned the corner. There is statistical and anecdotal evidence that a new market is evolving. Pending sales at the end of March in Anne Arundel County were at 697, up 74.7% from February. There were 45.1% more units sold in March than in February. We are seeing multiple contracts and escalation clauses for well priced properties. Homes priced below $400,000 are selling while more expensive properties continue to sit. Across the U.S. there were 3.2 million homes for sale in February, up 2.6% from January. We have a 9.1 month supply of homes nationally and a shadow inventory that is estimated at 700,000 homes. We’re not out of the woods yet but were getting there!

The S&P/Case-Shiller Home Price Index for the Washington DC marketplace declined again in January. The Baltimore Metro Home Price Index for the same period declined 4.0%. And the Anne Arundel County Index declined 0.8%. Only the Annapolis Index was up 5.2% in January over December 2008.

The total sales volume for Anne Arundel County was up 50.4% in March from February. The number of units sold was up 45.1% and the number of active listings was down 4.2%. The number of pending sales was up 74.7%. The average sold price was up 3.7% from $365,599 to $378,054. There were 338 units sold in March up from 233 in February.

The total sales volume for Annapolis was up 43.9% in March from February. The number of units sold was up 64.9% and the number of active listings was up 7.2%. The number of pending sales was down 0.9%. The average sold price was down 12.7% from $552,930 to $482,453. There 61 units sold in March up from 37 sold in February.

The quickening sales pace is likely to continue for several more months.  However, it may be early summer before sellers see stability in sales prices. Buyers will continue to benefit from lower prices and excess inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

Market Assessment – Spring Conditions

Over the last couple of weeks in the $0-500K price bracket it seems like property is starting to move. Perhaps this is just an early spring market, or there is some demand that hasn’t been satisfied, but, now that demand is being fulfilled. I’ve been working with a few clients who after looking at a house, thinking about it, finally getting interested in it, only to find that there were now multiple contracts to contend with!!! Hmmm … feels like a “tipping point” from buyer’s market to seller’s market and maybe we’re transitioning into a new market. You see, it’s like a recession … you don’t know that you’re in one until after it’s almost over. My intuition (gut instincts) suggests that we’re certainly transitioning from the winter market to a spring market. Showings are up, contracts are up, all of which leads to an uptick in sales. Are these signs of a transitional market – yes – a seller’s market – maybe – only time will tell. Buyers, take note!!!

Market Update – Annapolis Condos

As of February 25, 2008, there were 236 condos that had not yet sold in Anne Arundel County.  The average days on market for these condos was 191 days.  And the average asking price was $319,905.  There were 27 condos that were pending sale that had been on the market an average of 126 days with an average asking price of $236,788.  In the past 90 days 25 condos had sold.  They were on the market an average of 162 days and sold for an average price of $258,014 (92.3% off their original listing price).

In Annapolis there were 105 condos that had not yet sold.  The average days on market for these condos was 174 days.  And the average asking price was $415,244.  There were 10 condos that were pending sale that had been on the market an average of 121 days with an average asking price of $262,960.  In the past 90 days 8 condos had sold.  They were on the market an average of 134 days and sold for an average price of $382,350 (75.5% off their original listing price).

Along the Bestgate corridor there were 14 condos that had not yet sold.  The average days on market for these condos was 148 days.  And the average asking price was $281,507.  There were 4 condos that were pending sale that had been on the market an average of 104 days with an average asking price of $279,950.  In the past 90 days 4 condos had sold.  They were on the market an average of 158 days and sold for an average price of $277,200 (92.5% off their original listing price).

While the local condo market might appear to be dormant, when looked at in context with the rest of the local area real estate market, the overall market in Anne Arundel County hasn’t faired much better.  At the end of January 2009, there were 3,791 properties that had not yet sold in Anne Arundel County.  There were 344 properties pending sale and 722 new listings taken for the month.  In January 2009, there were 205 properties sold in Anne Arundel County.  They were on the market an average of 142 days and sold for an average price of $371,647 (88.21% off their original listing price).

Anne Arundel County ALL PROPERTIES Market Statistics for January 2009 and 2008

	2009	2008	% Change
Total Sold Dollar Volume:	$ 76,187,655	$ 107,209,001	- 28.94 %
Average Sold Price:	$ 371,647	$ 413,934	- 10.22 %
Median Sold Price:	$ 304,000	$ 325,000	- 6.46 %
Total Units Sold:	205	259	- 20.85 %
Average Days on Market:	142	134	5.97 %
Average List Price for Solds:	$ 421,327	$ 457,447	- 7.90 %
Avg Sale Price as a percentage of Avg List Price:	88.21 %	90.49 %

While the condo market represents only 584 of the 3,791 active listings (15% of the whole market), it represents a much smaller fraction of the overall sales in January (4% of the whole market).  In January 2009, there were only 8 condos sold in Anne Arundel County.  They were on the market an average of 133 days and sold for an average price of $223,706 (88.84% off their last listed price and 84.65% off the original listing price).

Anne Arundel County CONDO Market Statistics for January 2009 and 2008

	2009	2008	% Change
Total Sold Dollar Volume:	$ 1,789,650	$ 5,373,750	- 66.70 %
Average Sold Price:	$ 223,706	$ 298,542	- 25.07 %
Median Sold Price:	$ 179,500	$ 240,950	- 25.50 %
Total Units Sold:	8	18	- 55.56 %
Average Days on Market:	133	110	20.91 %
Average List Price for Solds:	$ 246,500	$ 315,858	- 21.96 %
Avg Sale Price as a percentage of Avg List Price:	88.84 %	92.68 %

In conclusion, the Anne Arundel County real estate market did not fair well in January 2009.  The number of pending transactions are up and we can except stronger sales before the end of the first quarter of 2009.  However, overall, sluggish market conditions can be expected for at least the rest of first quarter and well into second or third quarter of 2009.  Current economic conditions will continue to impede sales for sometime to come despite favorable interest rates and incentives (for example, first time home buyer tax credits).  While inventory levels remain high, sales prices will continue to decline until such time that buyers perceive a value shift in the marketplace.  Inventory level are likely to continue to climb in the spring and new listings come to market.  So, sales prices are likely to continue to decline further.  Serious sellers are encouraged to price ahead of the market in order to get their home sold sooner before market condition further erode home prices.  Serious buyers have many choices from which to choose.  Well qualified buyers ready to make a move should be able to obtain the very best price and terms.

Market Assessment – Market Shift Ahead?

By the end of last year most real estate was in rough shape. Volume and units in January for Anne Arundel County were down 32% from December 2008. This comes as no surprise to anyone buying or selling real estate. While inventory levels and prices seem to have stabilized they are off 10% from this time last year. Market conditions may start to level out.  When looking up from the bottom of the trough one can either complain about how far the market has fallen or how much the market could go up on the next wave.

The Baltimore Metro Home Price Index for January 2009 was down 4.0% from December and down 8% from January last year. The Anne Arundel County index was down 0.9% from the December and down 9.4% from January last year. And, the Annapolis index was up 5.2% from December and down 19.2% from January last year. The Washington metro area S&P/Case-Shiller Home Price Index published for November was down 2.4% from October and down 19.4% from the year before.

The total sales volume for Anne Arundel County was down 32.3% in January from December. The number of units sold was down 32.9% and the number of active listings was up 2.9%. The number of pending sales was up 91.3%. The average sold price was up 1.4% from $364,760 to $369,957. There were 202 units sold in January down from 301 sold in December.

The total sales volume for Annapolis was down 1.8% in January from December. The number of units sold was down 22.6% and the number of active listings was down 5.0%. The number of pending sales was up 39.5%. The average sold price was up 12.4% from $443,461 to $498,234. There 41 units sold in January down from 53 in December.

The sluggish sales pace will continue into second quarter 2009.  It will be late spring before sellers see relief to falling prices. Buyers will continue to benefit from lower prices and excess inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

 

S&P/Case-Shiller Home Price Index - Washington DC, Baltimore, Anne Arundel County, Annapolis, Maryland

 

Market Assessment
No Relief in Sight

The New Year is finally here!  Hurray! Unfortunately there really is not much to cheer about. Although 300-plus homes did sell in Anne Arundel County in December, sales volume is off 23.7% and sales units is off 13.0% from this time last year. In Annapolis only about 45 homes sold in December, sales volume and sales units are off 39.3% and 26.2% respectively from last year.

The Baltimore Metro Home Price Index for December 2008 was down 2.2% from November and down 6.2% from December last year. The Anne Arundel County index was down 3.4% from the November and down 8.9% from December last year. And, the Annapolis index was down 7.5% from November and down 19.4% from December last year. The Washington metro area S&P/Case-Shiller Home Price Index published for October was down 2.6% from September and down 18.7% from the year before.

The total sales volume for Anne Arundel County was up 9.7% in December from November. The number of units sold was up 13.2 % and the number of active listings was down 11.0%. The number of pending sales was down 16.3%. The average sold price was down 3.1% from $376,320 to $364,760. There were 301 units sold in December up from 266 sold in November down from 401 sold in December of last year.

The total sales volume for Annapolis was down 11.3% in December from November. The number of units sold was up 10.4% and the number of active listings was down 10.4%. The number of pending sales was down 25.5%. The average sold price was down 9.2% from $488,330 to $443,461. There 53 units sold in December down from 48 units sold in November and down from 57 units sold last year.

The sluggish sales pace will continue throughout the first quarter of 2009.  It will be late spring before sellers see relief to falling prices. Buyers will continue to benefit from lower prices and excess inventory.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional real estate consultation without any obligation, contact Stephen Howell at 410-923-3217.

Market Assessment – No Relief in Sight

With no relief in sight anytime in the immediate future, the government continues to flounder in its attempt to resolve the current economic crisis. Bailouts, stimulus packages, and the recession are topics of casual conversation both at home and at work. Financial gridlock could be a better term to describe the current situation.

The Baltimore Metro Home Price Index for November 2008 was down 0.8% from the month prior and down 1.7% from this time last year. The Anne Arundel County index was down 2.0% from the month prior and down 7.4% from this time last year. And, the Annapolis index was down 4.6% from the month prior and down 4.7% from this time last year. The Washington metro area S&P/Case-Shiller Home Price Index published for September was down 2.5% over August and down 17.2% from September the year before.

The total sales volume for Anne Arundel County was down 33.5% in November from October. The number of units sold was down 34.2% and the number of active listings was down 5.2%. The number of pending sales was down 3.7%. The average sold price was up 1.1% from $380,261 to $384,560. There were 229 units sold in November down from 347 sold in October down from 346 sold in October of last year.

The total sales volume for Annapolis was down 19.4% in November from October. The number of units sold was down 29.4% and the number of active listings was down 8.8%. The number of pending sales was down 9.7%. The average sold price was up 14.2% from $427,536 to $488,330. There 48 units sold in November down from 68 units sold in October and down from 61 units sold last year.

As the year comes to a close, our attention turns to the holidays. There is not likely to be good news for sellers any time soon. This is an extraordinary period for buyers looking to find bargains.

In Conclusion

If you are thinking about making a change, let us help you take advantage of these trends. So, if you’re buying or selling a home or know someone who is, for a confidential, private, professional consultation without any obligation to discuss today’s real estate market, please contact Stephen Howell at 410-923-3217.