Unexpected uptick' encourages agents, sellers in housing market
Most active March in five years in D.C. region, new report says
Home sales are picking up this year, say Maryland real estate agents, but they remain cautious about calling the trend a turning point in a market that's generally been moribund since before the Great Recession.
The metropolitan Washington region last month saw 5,432 signed contracts, the most in the month of March since March 2006, according to the most recent RealEstate Business Intelligence Pending Home Sales Index, a subsidiary of Metropolitan Regional Information Services of Rockville. Pending home sales jumped 34.3 percent month-over-month in the region, with three consecutive months of higher pending sales activity. Median sales price also showed a seasonal increase of 6.7 percent in the first quarter.
"I've had six settlements in four-and-a-half weeks. That's definitely more than usual," said Josh Ross, a Germantown agent with Re/Max. He said he typically settles on two or three deals in that period. "I still have more in the works. I'm still meeting with buyers."
Buyers are capitalizing on still-low mortgage interest rates, with more renters jumping into the market, he said.
"Buyers who had been sitting out are more ready to do something, and sellers are tired of waiting around," said Anne Cavanagh, a Bethesda agent with W.C. & A.N. Miller Realtors, a Long & Foster company. "The last couple months have just been off the charts. ... It's been busier than I've seen in the 22 years I've been in business."
The uptick was unexpected, said Laura Roskelly, a Millersville agent with Keller Williams Realty. Roskelly saw a 32 percent increase in sales in January and a 20 percent-plus increase in February.
"We're back to the pre-2005 levels," Roskelly said. "Some of it has to do with consumer confidence coming back, but most of it has to do with price range. Homes that weren't priced right still aren't selling."
The Anne Arundel County housing market also is getting a boost from military families relocating to Fort Meade due to the Pentagon's Base Realignment and Closure program, plus families relocating for the base's cybersecurity command center, she said.
Yet Clifford Rossi, executive-in-resident with the Center for Financial Policy at the University of Maryland's Robert H. Smith School of Business in College Park, are hesitant to declare an end to the years-long housing slump.
"In these kinds of markets, there's a period of bumping along," Rossi said. "One quarter it might be great and the next, it's soft again. We need to see a few more of these trends before we can really say anything."
While Rossi said he could not characterize what agents are reporting a turning point, it could be the emergence of one. He said people should not expect any "material increases" in home prices for the next few years. Rossi also said that Maryland is unusually insulated from the market problems seen throughout the nation because of its proximity to the nation's capital.
Some agents also remain wary about inferring a general trend in the entire region.
"A lot of those all-encompassing statements can be partially misleading due to ZIP codes," said Eugene Gallagher of Gallagher & Co. Real Estate in Bethesda, adding that increases vary among parts of the region and even within counties.
While Chevy Chase and Rockville might be experiencing high sales, areas such as Clarksburg are seeing less activity, he said.
Year-over-year in February, Maryland saw a 5 percent increase in sold units, to 3,173 from 3,021, and a 25 percent increase in pending sales, to 5,146 from 3,842, according to information from the Maryland Association of Realtors. But counties such as Baltimore, Carroll, Cecil, Frederick, Howard, Queen Anne's, St. Mary's, Wicomico and Worcester continued to see slower sales.
"I'd like to believe everyone is enjoying the briskness, but a lot of people are still suffering," Gallagher said. "We're still a fragile market, but this is a foundation to work from."
He added that many buyers might be getting into the market because they are afraid of losing the opportunity, should conditions shift.
"It's sporadic, but anything close to the [federal] government is doing really well. That's the bottom line," said Pat Terrill, president-elect of the Realtor association. "As long as the market rates stay low, I think we're going to be fine. The market is what it is. It's not good or bad; you just have to work with it."