Home sales decline regionwide in July

Sales, which include residential homes, condos and co-ops, dropped at least 15 percent from a year earlier in Alexandria and the District, as well as Arlington, Fairfax, Montgomery, Prince George’s, Loudoun, and Prince William counties, according to data from Metropolitan Regional Information Systems Inc.

“The housing market in many jurisdictions [has] been on a sugary high,” said Anirban Basu, chairman and CEO of Sage Policy Group, a Baltimore economic consulting firm. “There is an underlying sluggishness to most housing markets in the nation … low interest rates and sugary incentives can only take the market so far.”

Federal tax credits of up to $8,000 were slated to end in November, but were extended to April 30. Buyers who had a contract by the end of April had until June 30 to close on the home, though Congress recently extended that closing date to Sept. 30.

In the Maryland suburbs as well as the District, year-over-year home sales were up in every month from January to June, before falling off in July. Montgomery County home sales were up about 41 percent in April, but fell 22 percent in July. In the District, sales swung from a 58 percent jump in April to an 18 percent drop in July.

In Prince George’s, the difference was even more pronounced: Sales were up 86 percent in April and down 15 percent in July.

The end of the homebuyer tax credit didn’t hurt sales of higher-end houses, but now homes costing under about $350,000 are just sitting there, said Debbie Cook, a real estate agent based in Silver Spring.

“I think a month is too early to give a picture, especially in July or August,” when activity typically slows down, she added.

Still, significant progress was made in hard-hit areas such as Prince William and Prince George’s counties while the tax credit was offered, Basu said. Because the homes in those locations are less expensive, those jurisdictions are “disproportionately” attractive to first-time homebuyers, he said.

But unlike in Prince George’s County, year-over-year home sales have been down each month this year in Prince William.

The Virginia suburb already went through its own flurry of buying in early 2009 when home prices were still plummeting there. By August 2009, though, the median sales price had increased and home sales fell — a trend that’s continued each month through July.

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