Home sale prices increased throughout most of the Suburban Maryland region in August, according to the latest Long & Foster Real Estate Market Minute Report. Aside from Frederick County, which exhibited a 5% decline, the region enjoyed increases from 3% to 9%.
The number of homes sold fluctuated throughout the area, with Frederick County showing a 12% increase while Prince George’s County had an 8% decrease. Available homes for sale continued to drop, with decreases ranging from 34% in Prince George’s County to 8% in Frederick County.
“The story’s the same in the suburban Maryland region as it has been the past couple of months,” said Larry “Boomer” Foster, president of Long & Foster Real Estate. “Montgomery County has had some decent sale price increases, but everywhere else you see single-digit price appreciation.”
Foster said the market going into the fall season is expected to be “relatively good between now and Thanksgiving.” Although the spring market peaked later than usual in 2019—with strong sales continuing through mid-May—Foster does not expect the same lag to occur this fall. He anticipates similar market conditions as experienced in fall 2018, except with significantly higher demand and better interest rates.
Foster also spoke about the Federal Reserve’s potential lowering of the federal funds rate and what effect that could have on the market. While the federal funds rate can affect 30-year fixed rates, the two are not directly tied together. Foster said they’re “directionally correct, meaning they typically go down together, but not always.” The 30-year fixed rate associates more closely to Treasury bonds and since the yield on Treasury bonds are so low, that is pushing down the 30-year fixed rate. Many investors have parked their money in Treasuries, as the world economy remains uncertain, which drives interest rates down as well.