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 January 2013 MRIS housing data. Click here to view the full releases.
Sales fall with typical seasonal pattern, however new contracts spike in condo market
The inventory shortage continues in the Washington DC Metro Area housing market as we begin 2013. Active listings for all property segments remain low, and townhomes have the lowest proportion of listings on record. The short supply is having an impact on median sales prices, which experienced double-digit growth for the 4th consecutive month. Townhomes led in median price growth, up 13.3 percent, a $40,000 gain in value. Demand remains strong in the market as evidenced by a spike in new contract activity in January. The condo market had the largest gains in new pending contracts, up 10.3 percent. Despite the ripe conditions, sellers are still not responding. New listings for January increased from December, but this is typical for the season. The total number of new listings is the lowest for any January in over 15 years, a clear indication that sellers remain cautious. There are a wide range of factors that could be keeping sellers from listing their properties. Many could not have enough equity at current prices to “trade up” into a larger unit. Others may have trouble finding a unit to begin with because the inventory is so low. Economic uncertainty also remains a key issue on the table for many.
Townhomes lead the way; Despite strong sales, prices are flat and decline in many areas
The supply of active listings in the Baltimore Metro Area housing market continues to shrink, and is at the lowest January-level in eight years. However, the pattern appears to be changing slowly with new listings, which had the highest year-over-year gain since Spring 2011. New listings are also up across all property segments, which has not occurred in over 2 years. Even with the shifting pattern in new listings, the overall inventory still remains low. There are a wide range of factors that could be keeping sellers from listing their properties. Many could not have enough equity at current prices to “trade up” into a larger unit. Others may have trouble finding a unit to begin with because the inventory is so low. Economic uncertainty also remains a key issue on the table for many. Signs of demand in the market remain strong. Sales growth has been consistent in the region, and new contract activity has exceeded its 10-year average. Despite the sales growth and low inventory, prices are flat metro-wide, and have declined in several jurisdictions. This could be an early indication of softening demand, but it could also signal a change in the types of units purchased. Evidence of this can be seen in the townhome market, which led in year-over-year sales growth for the first time in 3 years, and year-over-year new contract growth for the first time in 1 ½ years.
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