Summing up the local housing situation
Delta Associates, in its year-end report on the housing market, says the Baltimore metro area saw 14 net sales of new condos during the last three months of 2008. Why "net"? Because that takes into account cancellations, which are significant. In the city, Delta notes, "there were more contract cancellations than sales in 2008."
There weren't a lot of new condo sales elsewhere, either:
For the year, there were a total of just 48 net sales in the metro area, a reduction of more than 90% from 2007.Prices for new condos fell faster in the suburbs (down 12 percent) than in the city (down 3 percent).
On the other hand, the median condo resale price was up 4.5 percent in the city, as of November. Resale condo prices dropped 4.7 percent overall in the metro area, to just over $225,000, Delta says.
Here's Delta's prediction for the housing market:
We believe increased demand and a decline in construction will stabilize pricing, leading to an up-tick in sales activity, with improvement in market conditions appearing in 2010. ... Housing prices are more stable here compared to other areas, as Baltimore refrained from overbuilding during the boom.A number of real estate agents have said there was a form of overbuilding in some city neighborhoods -- lots of expensive rehabs -- but that might be more about price category than overall quantity.
Other details from the Delta report:
--The vacancy rate in so-called "class A" apartment buildings is stable at 4.6 percent in the Baltimore metro area, compared with 6.1 percent nationally.
--Average rent is about $1,360, up 1.3 percent from a year ago. It's up more than that in some parts of the metro area and down in others. Delta reports a 3 percent drop in rents in Fells Point and the Inner Harbor.
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Comments
who/what is delta associates and why are you quoting their numbers/projections without a reference yardstick. I actually think you write decent columns except for this one and one about 6 months ago
Posted by: Anonymous | January 22, 2009 7:36 PM
Delta Associates -- deltaassociates.com -- is a Virginia company well known in the biz for its real estate information. I should have noted that in the post, but it slipped my mind. (For the same reason, I'll also occasionally forget to note that Metropolitan Regional Information Systems runs the local multiple listing service -- I forget that it's not self-evident. One of the hazards of doing this blog solo.)
Could you explain what you mean by a "reference yardstick"?
Posted by: Jamie Smith Hopkins | January 22, 2009 8:07 PM
Maybe comparing their report to people that do not benefit from the industry such as the shiller index would be beneficial. Lawrence Yun and their last shill that had a recent change of heart and bared all (forget his name) should give you an idea of what the industry can do to manipulate projections.
Cancellation of four seasons condo, ritz carlton settlement rate are further clues. In reasonably priced range, the water street project, 1209 N charles, 850 aliceanna are even better predictors of what the market is doing than the above report you site.
I will pm you resales in a condo building and you make your judgement for the 4.5% (so called) increase in that market.
Posted by: Anonymous | January 22, 2009 8:37 PM
I'm not surprised that they're reporting the median resale price for city condos was up 4.5 percent, because Baltimore saw some pricey condo development during the boom. As those condos resell, they would tend to pull both the average and median price up.
Averages and medians are useful but not perfect, alas.
As for the Case-Shiller index -- I wish there was a measurement for Baltimore, but Washington is as close as it gets. Phooey.
Posted by: Jamie Smith Hopkins | January 22, 2009 9:01 PM
Maryland's "ghost inventory" is starting to attract some interest from the main strem media:
http://money.cnn.com/2009/01/21/real_estate/ghost_inventory/index.htm?postversion=2009012314
Posted by: Anonymous | January 23, 2009 3:23 PM
Anon 3:23, that's interesting -- thanks. RealtyTrac (last I checked) has trouble getting all Maryland foreclosure data, so it's possible the "ghost inventory" is higher than it thinks for the state.
Posted by: Jamie Smith Hopkins | January 23, 2009 4:32 PM
I've looked in some of the condo developments. All of them have huge inventory, and but unwilling to lower prices. I guess the people who bought would be mighty angry if they slashed prices, but this stalemate cannot persist forever, and can't end well.
Posted by: semiconscious | January 24, 2009 4:34 PM
I see auctions ahead. Does anyone really know the truth regarding Silo Point sales?
Posted by: Richard | January 25, 2009 11:56 PM