Local Real Estate Market Mixed, But Slowly Improving

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By Darrell Mak
Although the median home price dropped seven percent countywide last year, price performance was near even in the Severna Park area, lending support to the notion home prices have finally begun to stabilize after a couple years of precipitous price drops during the peak of the financial crisis.

“The market is looking pretty good now in Severna Park,” said Dave McCollough, a broker with Advanced Realty in Severna Park, a full-service discount broker, pointing to rising prices so far this year. “That’s a good sign,” he added.
For 2010, median home prices in the Severna Park and Arnold zip codes registered a modest three percent increase, while median prices in the Millersville zip code fell a slight one percent, according to the Metropolitan Regional Information Systems, which serves as the multiple listing service for the area. However, the number of home sold during the year fell in all three areas, mimicking the performance of the county.
In sum, 2010 didn't show a whole lot of improvement for the real estate market, but it was a year when expectations continued to be tempered to more closely match the lethargic economic situation. The area’s close proximity to D.C. and the activities at Fort Meade blunted the impact of the nation’s housing recession, where other parts of the country have yet to recover from market declines. In addition, tight credit, which has been depressing sales activity since the credit crisis struck, is starting to show signs of easing.
“The 2010 numbers definitely showed a leveling of the market. I perceive a similar trend this year, with a possible increase in prices,” said Christine Joyce, a realtor with Champion Realty. “It’s still a buyer’s market, but the good news for sellers is properties are moving.”
While full-year numbers generally reflect more reliable trends, the latest statistics for February 2011 show strikingly different results for the area. Looking at February’s numbers, median home prices in Severna Park rose 10.8% to $437,500 over last February. The number of units sold increased to 18 during the month, up from 10 units, although the number of days houses sat on the market more than doubled to 184.
Looking deeper into the length of time it took to sell those homes, McCollough found a few homes that had been on the market for nearly a year sold in February, causing the increase in the days on the market. “New listings sold pretty quickly, and some old listings ended up selling,” he concluded.
February’s market in Arnold was much different. The median home price tumbled 24.5% to $273,390, as the number of units sold increased 17 percent and the number of days on the market dropped 37 percent to 71 days.
The trend in Millersville sales was similar to Arnold with the median home price dropping 32.2% to $300,950, the number of units sold increasing 67 percent, and the number of days on the market declining 27 percent.
As the spring real estate season kicks into full swing, McCollough expects to see more demand on home prices and inventory, although it may also put upward pressure on interest rates.
McCollough examined the number of pending sales, which include homes that have contracts on them, which tends to be a leading indicator of the market’s health. In Severna Park, pending sales were up 27 percent in January and another 9 percent in February.
“That’s a good trend to look at,” he commented. “The trends seem to be up in all categories.”
Today’s more-stable market presents an opportune time for those interested in trading up or trading down. In booming markets, those who try to trade up may end up paying a premium for a larger house. Similarly in a declining market, buyers may pay less for their new property, but lose more trying to sell their old one.
In addition, McCollough expects positive news coming out about the Base Closure and Realignment Commission (BRAC) around the end of this year and into 2015, which will increase home demand while pushing prices higher and inventories down.
“There are a lot of good, positive things going on in market now,” McCollough said. “I believe we bottomed out last year and things are moving up now, albeit slowly.”
As always, a good listing with a good price and proper staging will always sell quickly, and for top dollar in any market.



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