Without a doubt the Washington, D.C. metro area’s real estate market in general has weathered the epic economic downturn better than most other regions in U.S. Some zip codes here, however, have experienced home value declines even in double digits and mortgage foreclosures are a common topic around the smoking grills at backyard cookouts. Nothing, though, like what has swept over cities in states like Nevada, California, Arizona and Florida where homeowners were staring at price drops of unbelievable proportions and are now bravely trying to deal with the adverse consequences of that.
Montgomery County MD has for the most part held on fairly well and is displaying signs of even better times ahead, according to statistics provided by Real Estate Business Intelligence, or RBI. Time to look at some of the numbers to get a glimpse of what’s really going on.
In July 2012 the average sold price was $499,413, a small increase of 1.38% from July 2011. Regardless, anyone in this real estate market would take that. 972 units changed hands in July 2012 whereas only 907 of them did so last year at the same time, a 7.17% jump. Average days on the market came in at 57 in July 2012 while it stood at 73 in July 2011, a considerable decrease of 21.92%. Just looking at these three indicators reveals clearly that the housing sector in the county is steadily improving in a year-over-year comparison.
Yet, as RBI stats point out upon further scrutiny, the real estate road being traveled in the prosperous county has some bumps. In its month-to-month read the average sold price of $499,413 turns into a slight decline of 1.38% from June 2012. And the average days on the market figure of 57 for July 2012 actually is a 1.79% increase from June 2012. Admittedly this is reason for some concern since spring and summer months are times when housing transactions keep mortgage originators and real estate agents busy closing sales.
The sinister reach of the infamous financial meltdown has obviously penetrated relatively deep into Washington metro area’s housing sector, too. Despite the massive and steady federal government playing a significant role in its economy, it remains soft. People are uneasy about their job status that keeps them from making major financial decisions. Scores are still out there looking for a job. The mortgage industry, from Fannie Mae and Freddie Mac to banks large and small, has tightened considerably underwriting guidelines to stifle buyer enthusiasm.
Small diversions are expected, though. The large view is positive for the local real estate arena and will likely stay that way, spurred by the slowly expanding economy and by mortgage interest rates that have managed to sashay along – thanks to the Fed - a flexible band under 4% for months now.