While recent numbers indicate what some say is an end to the area?s strong real estate market, many in the industry are saying it?s merely back to reality.
“The frenzy has departed,” said David McIlvaine, a board member with the Greater Baltimore Board of Realtors and an associate broker with Keller Williams of Ellicott City. “Basically we see it cooling and the cooling is back to a more traditional market. It?s still strong but the frenzy is just not there anymore.”
According to data compiled by Metropolitan Regional Information Systems Inc., the total number of homes sold in the Baltimore area, which includes Baltimore City and Anne Arundel, Baltimore, Carroll, Harford and Howard counties, dropped from 5,048 in June 2005 to 3,909 in June 2006, marking a 22.56 percent decline.
Average days on the market increased from 38 days in June 2005 to 51 days last month, though average sale prices rose by 3.41 percent to $319,633.
“The reality is that although those numbers on the surface may appear alarming, they?re being compared to June 2005, which was the start of the end of three years of back-to-back record sales,” said Alan Ingraham, president of the Maryland Association of Realtors. “The other factor to keep in mind is that although activity has slowed, values continue to hold their own. What would give me concern about the marketplace is if there was a slowdown in activity along with diminishment in values.”
Tracy Gosson, executive director of the Live Baltimore Home Center, agreed, saying that the recent numbers are no reason for concern.
“There is a reality adjustment to the marketplace and it?s nothing to be alarmed about,” Gosson said. “You?re not going to get 20 offers and $50,000 over the asking price, though. But, overall [the market] is still very healthy and there is no concern of a depression on the horizon. This is not 1998.”
Gosson added that the MRIS numbers only provide a one-month snapshot ofthe market and that a better comparison is to look at the numbers during a six- to 12-month time period.
In Baltimore City, which Gosson said remains “a hot destination” to buy real estate, the total number of homes sold dipped by 25.49 percent from 1,365 units sold in June 2005 to 1,017 in June 2006.
Average days on the market for June rose by 5.56 percent from 54 days in 2005 to 57 days in 2006. However, average home prices again increased by almost 4 percent to $180,176.
“It?s what you would call a market adjustment. People need to ground their decisions a little more in reality,” Gosson said. “You?re still going to be able to ask a reasonable selling price, it?s just not going to be [a] ridiculous” amount.
Average prices and number of homes sold in June 2005 compared with June 2006
Anne Arundel County
» Total units sold
2006: 750
2005: 1,093
» Average price
2006: $423,896
2005: $418,458
Baltimore City
» Total units sold
2006: 1,017
2005: 1,365
» Average price
2006: $180,176
2005: $173,293
Baltimore County
» Total units sold
2006: 1,097
2005: 1,320
» Average price
2006: $315,802
2005: $301,036
Carroll County
» Total units sold
2006: 246
2005: 279
» Average price
2006: $389,682
2005: $344,489
Harford County
» Total units sold
2006: 374
2005:445
» Average price
2006: $283,622
2005: $283,513
Howard County
» Total units sold
2006: 425
2005: 546
» Average price
2006: $398,000
2005: $388,500
Source: Metropolitan Regional Information Systems Inc.
