Home sales fell faster in Maryland than in any other state in the nation in the first three months of the year, dropping more than even in hard-hit spots of the country such as California, a Realtors group said yesterday.
Sales in January through March dropped nearly 39 percent in Maryland compared with the same months last year, the National Association of Realtors said. Close behind were Washington, D.C., where sales were down almost 35 percent; Utah, down almost 34 percent; and California, down about 33 percent.
But the decline in prices was not as precipitous. The Realtors, who track values by metro area rather than state, said the median price of single-family homes fell 3 percent in the Baltimore metro area in those months, which was middle of the pack in the country. In the Washington metro area, which includes parts of Maryland, the price fell 13 percent, still a far cry from the drops on the West Coast. Sales prices fell more than 25 percent in both Sacramento and Riverside, Calif.
Marc Witman, a partner with Yerman Witman Gaines & Conklin Realty in Baltimore, strongly suspects that Maryland home sales are falling so fast because prices aren't.
"There's a disconnect between what the buyers expect to see and what the sellers expect to receive," he said. "It's like the buyers are the only ones reading the newspapers. I think when you see the median price come down 10 or so percent, then you're going to see more buyers come off the sidelines."
Though some sellers are dropping their prices enough to interest buyers, many continue to resist, he said.
Amna Kirmani, a marketing professor at the University of Maryland who specializes in consumer behavior, calls it the "my house is different" phenomenon: "People are anchoring on their own love for their houses instead of anchoring on what the market is doing right now. We never think it applies to us."
Maryland's continued job creation and low unemployment rate - compared with layoffs nationally - are probably adding to sellers' perception that their asking prices are reasonable, she said.
"They may feel they're a little more insulated than other areas," Kirmani said.
Some sellers, particularly those who bought in the past few years, think they have no choice. If they lower their asking prices, they'll get less than they owe on their loans.
"It's a challenging time right now," said Keith T. Gumbinger, a vice president with financial publisher HSH Associates.
