Washington Housing Market Beats Baltimore

Real Estate Wonk

From The Blogs

Capital-area Inventory Drops As Houses On Market Less Time

November 08, 2009|By JAMIE SMITH HOPKINS

Home-sale trends are generally stronger in and around Washington, but the Baltimore area is showing some signs of life. That's the conclusion of a new report by Delta Associates, a real estate information and consulting firm, and Metropolitan Regional Information Systems, which runs the region's multiple-listing service.

Sales in the summer were up about 7 percent from a year earlier in the D.C. region, and there were 5.4 months of inventory - "below the normal, healthy standard of 6 months, signaling that demand is beginning to outpace supply," the report notes. ("Months of inventory" refers to the time it would take homes listed for sale to find buyers at the current pace of transactions.)

In the Baltimore metro area, sales in the summer rose a bit faster - about 8 percent from a year earlier. But there's more catch-up to do: 8.8 months of inventory.

Homes are sitting longer on the market here as well: 117 days in the Baltimore area compared with 81 in the Washington area.

The market decline hit our southern neighbor first, and it started to recover first, too. D.C.'s job market is one of the strongest in the nation, which doesn't hurt.

The Delta and MRIS report also shined a spotlight on neighborhoods around BWI, a market between Baltimore and Washington. It offered some illuminating statistics about what exactly is selling.

Some 37 percent of homes listed for sale in the area - nine ZIP codes, including Glen Burnie, Linthicum and Hanover - are foreclosures and short sales. But they account for 61 percent of the homes under contract there, the report says. Buyers clearly prefer the distress prices of these distress sales.

Speaking of prices, they're down 8 percent from a year ago in the BWI area. But the inventory is quite low - 2.1 months. Remember, six months is considered normal and healthy. All else being equal, you'd think a 2.1-month inventory would mean a strong seller's market - this is the sort of number we saw in the go-go housing bubble days. But all else isn't equal.

The Delta/MRIS report says that although the BWI area "seems well-positioned for future housing market growth and recovery, ... until foreclosures and short sales abate further, near-term price declines are not improbable."

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