Annapolis Maryland Luxury Real Estate

The buyers' market continues with no cooling in sight. Sellers, now facing the dog days of summer, are likely to see the inventory level reach new highs and falling prices hit new lows with no relief in sight.

In Anne Arundel County in June the total sold volume was down 31.8% from June 2007. The average sold price was down a modest 3.3%. The number of homes sold was down 29.4% and the average days on market was up 28.5%.

There were 477 units sold in Anne Arundel County in June 2008, up from 407 units sold in May. The number of active listings was 4,729 in June, up from 4,629. The number of new listings taken in June was 993, down from 1,080. The number of listings with pending contracts in June was 452, down from 509. The average sold price was $427,655 in June, up from $399,726. The average number of days on market was 125 in June, down from 144. The average list price to sold price ratio was 90.46% in June, down from 91.34%. Total sales volume for June was $204.0 million in June, up from $162.7 million.

In Annapolis the total sold volume in June was down 33.2% from June 2007. The average sold price was up 8.5%. And, the number of homes sold was down 38.9% and the average days on market was up 38.7%.

There were 77 units sold in Annapolis in June 2008, up from 64 units sold in May. The number of active listings was 967 in June, up slightly from 966. The number of new listings taken in June was 190, down from 218. The number of listings with pending contracts in June was 125, down from 144. The average sold price was $627,710 in June, up from $531,736. The average number of days on market was 160 in June, down from 189. The average list price to sold price ratio was 94.37% in June, down slightly from 95.15%. Total sales volume was $48.3 million in June, up from $34.0 million.

So what can we expect for the third quarter of 2008? Inventory will continue to increase. New listings will decline. Pending sales will decline. The ratio of pending sales to active listings will decline and prices will drop further. There's no tipping point on the horizon when sales might improve. What has to happen? While the number of buyers in the market remains relatively constant, they believe that homes are overpriced. Sellers must lower their asking price and do so before their competition. Sellers should take all competition seriously and must price below properties under contract. When the buyers' perception is homes are overpriced, sellers must price their home to look like a bargain. The lowest price and most favorable terms will result in the fastest sale!

While no one can predict the future with any certainty, one thing is certain; it's a buyer's market. A firm understanding of the market trends and forces is needed to make the best real estate decisions. So, if you are serious about buying or selling a home in today's real estate market, call Stephen Howell, Associate Broker, REALTOR^®, Coldwell Banker Residential Brokerage, at 410-923-3217.

More of the Same for 12 to 18 More Months

The current real estate market is likely to continue to remain the same for the next six to twelve months. After the upcoming election it may take six to twelve months for the new President to implement policies that will have an impact and stopping the recession if we haven't plummeted into a depression before then. After the election, consumer confidence may return, but, not until oil prices ease (which are a large component of everything we purchase, from food to fuel). It is difficult to imagine that conditions are going to improve in the immediate future. So what is likely to happen in the real estate market over the next few months?

Home Prices To Decline

Home prices may fall another ten percent or more before buyers perceive there is value in the real estate market and start purchasing homes again. But lower home prices will not trigger a tipping point alone. Lower prices coupled with lower mortgage rates could stimulate home sales.

Mortgage Rates To Decline

Mortgage rates are and always have been market-driven. The real estate market - which depends heavily upon the availability of mortgage money - is slow because of fewer loan products, tighter underwriting, declining appraisals, high asking prices, and consumers' lack of confidence in the market. Interest rates below 6% and relaxed lender requirements might stimulate sales.

Activity Level To Decline

While home prices in our area have remained stable, volume is off from this time last year with one-third fewer homes sold in June compared to the same period in 2007. Until sellers stop holding onto high asking prices, until interest rates decline below 6%, until lenders ease borrower qualifications, home sales will remain sluggish.

In Conclusion

If you are selling you need to lower your asking price until showings increase and you get an offer. Then you'll need to run with it, no matter what the terms might be. If you are buying, you have many choices so look for a deal then negotiate hard.

If you are thinking about buying or selling a home or know someone who is, for a confidential, private, professional consultation without any obligation to discuss today's real estate market, please contact Stephen Howell at 410-923-3217.