The following analysis of the Baltimore, MD and Washington, D.C. Metro Area housing markets has been prepared by RealEstate Business Intelligence (RBI) and GMU Center for Regional Analysis, and is based on December 2012 MRIS housing data. Click here to view the full releases.
Condos lead in sales, new contracts, and price gains
The Baltimore Metro housing market has experienced considerable improvement this past year. Most indicators point to a healthier market going into 2013, and the trend continues in December with year-over-year growth in sales, new pending contracts, and the median sale price. The most striking aspect of the 2012 market has been the diminishing supply of homes for sale. Active listings continue to plunge, and have fallen below 10,000 for the first time since February 2006. This pattern appears to be slowly changing, as new contracts have been hovering around the 2011 level for the past 5 months. The condo market continues to see the most growth activity, and leads in year-over-year gains in sales, new contracts, and median sale price. As we continue through the winter season, it is unlikely that a dramatic surge of new listings will enter the market. This should keep upward pressure on prices as long as buyers remain active. If the inventory becomes too low, many buyers might decide to wait it out until more options become available, which could bring prices down in the near term.
Lowest level of new listings for any month on record
As the year concludes, most indicators point to a healthier market than last year, but several clues reveal a possible softening of demand in the near-term. Sales numbers and the median price are up from this time last year, but new contracts have declined slightly for the 2nd straight month. Additionally, unseasonable declines in sales and median price from November could be an early sign of weakening demand. The market is experiencing historically low inventory, with active listings at their lowest December-level in nearly a decade, and new listings at their lowest level for any month on record. While intuitively low supply would put upward pressure on prices, it could be that many buyers are deciding to delay their home purchase until more options become available on the market, which is loosening the pressure on pricing as evidenced by the $11,000 drop in the median sale price from November. Many potential sellers could be hesitant to enter the market during the winter months, so an increase in the spring inventory would likely entice buyers back into the market, and push median prices back up.