Amid skyrocketing foreclosure numbers, foreclosed homes are selling for 20 percent below their market value statewide, and 13 percent less in the Baltimore metro area ? and may be driving surrounding home prices down, too.
Statewide, the average sale price of 402 foreclosure properties sold in the third quarter was $291,614.81, 79.29 percent of their market value, according to RealtyTrac, an online foreclosure database and marketplace. In Baltimore City and its five surrounding counties, the average sale price was $296,823.65, 82.75 percent below market value.
That same quarter, foreclosures in the city and counties jumped an average of 707.5 percent last quarter from the year before, according to RealtyTrac.
The data, created for the state of Maryland, counted any type of foreclosure action taken on a property, but only one action per property, including those in Baltimore City and Anne Arundel, Baltimore, Carroll, Harford and Howard counties, according to RealtyTrac spokesman Daren Bloomquist.
That same area saw a 28 percent drop in the total dollar volume of properties sold and a nearly 30 percent drop in the total units sold, according to data released last month by Metropolitan Regional Information Systems Inc., a multiple-listing service owned by 25 Realtor associations covering Maryland, D.C. and Northern Virginia. The average sale price in the region remained stable, up 2 percent.
The MRIS data doesn?t track foreclosures and doesn?t separate sales of foreclosed properties from regular home sales, counting both simply as sales, according to Mary Jo Powell, director of communications for MRIS.
Neither set of data would include properties sold at auction, Bloomquist and Powell said.
Bloomquist said foreclosure properties, in addition to themselves lowering average home prices in the area, might lower the sale price of adjacent properties.
Stephen Walters, professor of economics at Loyola College, questioned MRIS? average home price data and the fact that the data are reported by Realtors who have a vested interest in not spreading panic through the market.
“They?re absolutely in a panic that other people will be in a panic,” he said. “The Realtor propaganda machine has been striving mightily to give [the] impression that prices are stable while volume is down.”
