Home sale prices increased across most of the suburban Maryland region last month, according to the latest Long & Foster Real Estate Market Minute report. Prince George’s County saw the highest increase with a 5% rise, while Charles County fell by 1%. The number of homes sold fell throughout most of the region, with Frederick County exhibiting the biggest decrease of 20%. Prince George’s County was the only exception with a 1% increase. Inventory also took a dip, with Prince George’s County showing a decrease of 29%.  

The Long & Foster Real Estate Market Minute report for the suburban Maryland region includes Charles, Frederick, Montgomery and Prince George’s counties.

Regarding the April market Larry “Boomer” Foster, president of Long & Foster Real Estate, believes that “the economy is really good. We’ve got ample demand, there’s plenty of credit for people to get and we’re not artificially running prices up.” The only difficulty in the market is the lack of product to sell, he said.  

There are many reasons as to the shortage of inventory: a lot of baby boomers are aging in place, people who bought or refinanced homes when interest rates were at an all-time low don’t want to move away from that rate and builders are not providing product consumers want.  

The tariffs that are being enforced on Chinese goods and Canadian lumber are driving up the materials costs. That along with the increase in wages for skilled workers and land appreciation is putting a squeeze on builders’ margins, Foster explained. Builders are offsetting those margins by building bigger homes however most consumers nowadays are looking to buy entry-level homes. 

With interest rates so low consumers have more buying power, meaning more can get qualified to buy. With the current economic environment Foster anticipates the interest rates to continue to be low as “domestic and foreign money get parked in U.S. Treasury bonds, keeping the yields on bonds and 30-year fixed rates down.” 

For those looking at purchasing new construction homes, it is important to work with a real estate agent. “The process is different, and you need somebody who’ll walk you through financing,” Foster said. “The contracts are written in favor of the builder so having someone well-versed in the process is essential. Typically, builders will charge premium prices for builder-grade finishes and fixtures, so knowing what to spend money on and what’s important in a home will make sure you’re getting the best value.”  

To learn more about your local market conditions, visit Long & Foster’s Market Insights. You can also learn more about Long & Foster and find an agent at LongandFoster.com.