Monday Market Update for Frederick County – a look into the future
March 10, 2008 by Bob Carney
Filed under Market Conditions
We had a meeting last week with a notable Frederick County Appraiser, Wayne Six. He talked to us about his take on the current market conditions. He feels we are still a while away from any type of turn around. We have to have about eight to twelve months of a stable market before climbing out of the hole. A key thing about our market is, of course the inventory. He follows the inventory numbers religiously. He held up a chart very similar to the ones I have been sharing with you on previous market updates and similar to the one below.
Wayne feels our inventory number will continue to climb to about 2400 homes. I have to agree as we were close to this last year. We had a drop of inventory around the holidays and as I have predicted they would climb back up again once spring hit. You just can’t have that many homes and expect to sell them in a reasonable amount of time. I really believe sellers are starting to understand this too. They should only sell, if they are truly serious. With all the short sales and foreclosures riddling the landscape, it makes it hard for a not-so-serious seller to compete with the low prices.
Here’s picture of the inventory over the last couple years. Do you see a trend? I do, that’s why I still believe it will climb in the spring.
You can see the inventory numbers are cyclic, however the overall is continually climbing. You can see we lingered around 2300+ homes last year for most of summer.
Below are the Housing Statistics for the Month of February. This housing report is usually available around the 10th of every month from MRIS.
February 2008 Market Condition Report
| 2008 | 2007 | % Change | |
|---|---|---|---|
| Total Sold Dollar Volume: | $46,088,832 | $78,980,193 | -41.65% |
| Average Sold Price: | $338,888 | $343,392 | -1.31 |
| Median Sold Price: | $295,000 | $305,000 | -3.28% |
| Total Units Sold: | 136 | 230 | -40.87% |
| Average Days on Market: | 146 | 119 | 22.69% |
| Average List Price for Solds: | $379,594 | $360,261 | 5.37% |
| Avg Sale Price as a | 89.28% | 95.32% | |
| percentage of Avg List Price: |
One of the key numbers that sellers need to understand, the Average Sales Price as a percentage of Average Listing Price. The average list price is higher than last year 5.37% …Yipee, but wait the other number is about the same amount lower (89.28%) than last year. This is a case of “I need xxx dollars for my house” and getting below market value for the house and longer days on market. (HINT: Buyer’s don’t care what you want or need.) Homes are being listed too high. Some agents do this because the are afraid to tell the truth and essentially “buy” the listing. Listing too high causes the seller to play catch up with the market. Wayne Six says we have been depreciating about 1-1.5% a month on home values. But that all depends on the inventory…lower inventory numbers will yield a slower depreciation and of course a higher inventory will yield a higher depreciation. It really comes down to the absorption rate of the neighborhood. Sometimes you have to dig deeper than county numbers to see the real picture.
If you need someone to do that for your home, give me a call.
Bob is a licensed Real Estate agent in Maryland and Pennsylvania. You can contact him via email at bob@gotbob4homes.com or call him on his cell phone at 240-285-4918. Bob left the Frederick area to manage a resort office near Deep Creek Lake in Western Maryland. He still stays in touch with the area that he has grown to love. 
Bob Carney
