The Baltimore region's white-hot housing market slowed in September, reflecting signs that a little air is leaking out of the national real estate boom, new statistics show.
More homes are piling up on the market, outpacing sales, and prices are moderating, according to data from the Metropolitan Regional Information Systems Inc., a Rockville firm that tracks sales. While September normally sees some falloff, experts and Realtors say that fewer buyers in the market and more homes for sale are signs that the market is cooling, though they caution that it will take several more months for a trend to be clear.
"No matter how you cut it, it's a softening of the market, not only over last year but over the past month," said Kenneth Wenhold, director for Maryland and Virginia for Metrostudy, a national real estate consulting firm that tracks market trends. "But the magnitude of it doesn't seem too extreme."
Across the region, 4,038 homes sold in September, the lowest number since April and down about 600 from August. And the average price slipped to $303,713, the second consecutive monthly decline.
Still, compared with a year earlier, sales were up 10.4 percent and prices were up nearly 20 percent, with double-digit increases in every county.
In September, listings throughout the region were up 29 percent from a year ago. And new listings outstripped contracts and pending sales by 2,160. Last September, the difference was 838.
"A 30 percent increase in inventory outweighs the 10 percent increase in sales," Wenhold said. Nevertheless, he said, the Baltimore market overall remains strong versus other parts of the nation.
City sales strong
The number of homes for sale rose most in Baltimore, which also posted the strongest sales gain by far. Listings increased 33 percent while homes sold rose nearly 27 percent compared with a year earlier. And while the average price advanced 29 percent over the 12-month period, the average sale price dipped $10,000 from August and nearly $20,000 since July, though that could be a sign that investors are buying more marginal properties.
The number of homes for sale also rose in the counties. In Howard, there were 33 percent more houses available. Anne Arundel and Harford counties had 30 percent more, Carroll 26 percent and Baltimore County 22 percent.
The number of sales compared with last September declined in two counties - Howard and Harford, where the average price also dropped from August.
A slowdown in sales is typical for this time of year, Wenhold and other experts said, and the market overall was not worrisome.
"Even with this softening, the Baltimore market is still quite healthy with respect to other hot markets," Wenhold said.
Houses in the region averaged 38 days on the market, down from 41 days last year at this time, an indication that the market is still very robust, experts say.
Nationally, housing experts are pointing to signals that a slowdown is occurring in hot markets across the nation.
"I think there's lots of evidence that it's topped out," said Nariman Behravesh, chief economist of Global Insight in Lexington, Mass. "That's a far cry from saying it's going to crash."
Too early to tell
Still, he cautioned that September can be a misleading month, and it may be this month or next before any real trend can be confirmed.
"If inflation starts to take off, then long-term interest rates will rise more than they have and that will start to hurt the housing market," he said. "The biggest vulnerability of the housing market is that it's very sensitive to increases in the interest rates."
Realtors in the field know the trends even before the official numbers hit.
At the end of August and the beginning of last month, Dorian Keydash, a Realtor with Century 21 Downtown, had started to sense that there wasn't as much competition for property.
"There aren't two or three buyers going after every house," Keydash said. "Before, there were bidding wars. Now it's a good 1-to-1 ratio instead of 3-to-1. But there are still good prices. They're just not moving as quick, because the competitiveness is not there."
Susan Myszkowski, a Realtor with Coldwell Banker in Timonium, has seen evidence of increased listings in pockets throughout the region. For instance, she recently pulled the active listings for a single ZIP code in Pasadena and discovered three pages of homes for sale in the $450,000-to-$700,000 price range. There haven't been that many listings there in past months, she said.
That's just a quick snapshot," she said. "But it does seem to be a bit of a slowdown.
"I think there is going to be some reasonable leveling off, because yes, gas is $3," she said. "But I still think there are going to be some certain neighborhoods that will be hot. And there won't be enough properties in those areas."