Home sale prices crawled upward in May throughout most of the suburban Maryland region, according to the latest Long & Foster Real Estate Market Minute report. Besides Montgomery County, which exhibited a 2% decrease in median sale price, the rest of the region had increases ranging from 1% to 8%. The number of homes sold varied throughout the region with Charles County experiencing a 24% increase while Frederick County had a 5% decrease. Inventory saw a dip in numbers with Prince George’s County showing a 29% drop followed by Charles County with an 18% decrease.
When looking at the market for May, Long & Foster Real Estate President Larry “Boomer” Foster said, “Inventory continues to shrink everywhere except where there’s room to build.” Builders will be more active in areas that haven’t been overbuilt so they can deliver products that they can make money on.
Still, the real estate market is looking strong, Foster said. “There’s a ton of competition and 30-year fixed rates are the lowest they’ve been in two years, so affordability is strong,” he said. He noted that we seem to be involved in a later spring real estate season than normal, with the market holding strong and steady when it normally would have slowed down by this time in past years. Due to the challenges faced in January and February, Foster expects June and July to remain high in terms of pending contracts.
Home flipping has become increasingly popular lately, which Foster associates with the popularity of iBuyer companies. “In an appreciating marketplace, home flipping is an attractive option for people who want to make quick money,” he said. iBuyers offer convenience for consumers who are looking to sell their home quickly without having to make any modifications or preparations to sell. These companies will typically close on the house within a 14-day period, flip it and sell it to make a profit. Unfortunately, it’s at the cost of the consumer because they end up buying these homes for far less than they are worth, Foster said. The popularity of iBuyers will continue to keep this a trend up as consumers feel a need to sell their home quickly.
Foster addressed the rise in mortgage closing scams in which criminals contact homebuyers by email in an effort to have them wire their funds for closing costs and down payment to a fraudulent account. He said when any transaction involves a significant amount of money, consumers need to double-check with their agent or financial institution. “People just need to be aware and reach out to their agent directly if they are unsure about anything involving their transaction or receive email instructions to wire funds,” Foster said. The Consumer Financial Protection Bureau has more information about protecting yourself.