As we steam into May, fast approaching the half year mark, rising gas prices are once again rearing their ugly heads. With an economy on shaky ground, rising fuels costs are having far reaching effects on all segments of the economy.
Reflecting on the statistics from the Maryland Association of Realtors for Maryland residential real estate sales for the first quarter of 2011, we find a relatively flat market, with sales, average price and median price all slightly off when compared to the first quarter of 2010. On a positive note, pending sales are up a little more than 9.0% and active inventory is slightly down at a little more than 1.5% fewer homes in inventory.
According to published Maryland Association of Realtor figures, sales came in at a –6.6% at 4,343 units for first quarter 2011 when compared with 2010’s 4,649 units sold. Average price was down slightly at -2.2% , comparing $265,883 with 271,961and the median price was off at $212,840 or -9.1% over 2010’s $234,840.
A silver lining to all these numbers is that 2011 comes up fairly well against the first quarter of 2010 which saw it’s sales stimulated by government largess in the way of the home buyer credit program.
Nationally, Home Prices Are Off to a Dismal Start in 2011- According to the Standard & Poor/Case-Shiller Home Price Indices. According to David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s, “The housing market recession is not yet over, and none of the statistics are indicating any form of sustained recovery.”
Looking ahead, there is still distressed inventory on the market and perhaps more to come, depending on what inventory the banks have not yet released.
For those attempting to sell their homes, it means facing the hard reality that one must price aggressively in a very competitive marketplace. Pricing and condition hold the keys to a sale, for location can’t be changed, but price can overcome shortcomings in both condition and location.
Buyer’s on the other hand have a lot of inventory from which to choose, however the landscape can be filled with peril. The marketplace is littered with distressed property being sold as-is under Short Sale circumstances or bank foreclosure sales.
A short sale occurs when the seller is selling the property for less than what is owed to the bank, therefore needing the bank’s or third party’s approval for the sale. Often the bank’s approval can take take a lengthy amount of time, may include a counter offer of a higher acceptable price than what the buyer and seller agreed to in their contract of sale, trying the patience of the buyer, leading to a fall through of the sale.
REO (real estate owned) or bank foreclosure property is the other type of distressed as-is property sales and typically these properties have been sitting abandoned, vacant and neglected. It is always advisable to proceed cautiously when buying distressed property.
Although distressed property sales may offer tremendous opportunity at a great price, be sure to get advice from industry professionals, such as your Realtor, a financial advisor, attorney, a licensed home inspector or structural engineer.
Charles Kraus, Associate Broker Coldwell Banker Residential Brokerage
office: (410) 919-2642 email: firstname.lastname@example.org