Housing markets: Baltimore vs. Washington (and BWI)
Sales in the summer were up about 7 percent from a year earlier in the D.C. region, and there were 5.4 months of inventory -- "below the normal, healthy standard of 6 months, signaling that demand is beginning to outpace supply," the report notes. ("Months of inventory" refers to the time it would take homes listed for sale to find buyers at the current pace of transactions.)
In the Baltimore metro area, sales in the summer rose a bit faster -- about 8 percent from a year earlier. But there's more catch-up to do: 8.8 months of inventory.
Homes are sitting longer on the market here as well: 117 days in the Baltimore area compared with 81 in the Washington area.
The market decline hit our southern neighbor first, and it started to recover first, too. D.C.'s job market is one of the strongest in the nation, which doesn't hurt.
The Delta and MRIS report also shone a spotlight on neighborhoods around BWI, a market between Baltimore and Washington. It offered some illuminating statistics about what exactly is selling.
Speaking of prices, they're down 8 percent from a year ago in the BWI area. But the inventory is quite low -- 2.1 months. Remember, six months is considered normal and healthy. All else being equal, you'd think a 2.1-month inventory would mean a strong seller's market -- this is the sort of number we saw in the go-go housing bubble days. But all else isn't equal.
The Delta/MRIS report says that although the BWI area "seems well-positioned for future housing market growth and recovery, ... until foreclosures and short sales abate further, near-term price declines are not improbable."
How are foreclosures and short sales affecting housing trends near you?
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Comments
Jamie,
While six months may be a typical inventory, what is typical for the BWI area?
Is 2.1 months atypical for that region?
Posted by: Robert Strupp | November 4, 2009 8:18 AM
Wish I knew, but the ZIP code statistics on MRIS's site only start in the fall of 2005. To get a sense of "normal," we'd need to see what it was around '99 or 2000 or so.
Posted by: Jamie Smith Hopkins | November 4, 2009 10:00 AM
"D.C.'s job market is one of the strongest in the nation, which doesn't hurt."
Doesn't hurt? The strength (stability and depth) of the job market is **everything**.
When that strength is coupled with high average wages the result is higher prices (eg: MoCo) and when it is coupled with moderate wages the result is moderate prices (eg: Iowa). But absent that strength the result is decimation (eg Arizona).
Posted by: MrRational | November 4, 2009 11:06 AM
Not sure where you are getting the 2.1 months of inventory from. Data I have seen has it at about 8.6 months of inventory for the Baltimore area.
http://www.recharts.com/AroundDC.htm
Posted by: IrishGuy | November 4, 2009 1:09 PM
MrRational, I know job stability matters a great deal -- I was understating for the humor of it. Too subtle, obviously. Will try harder next time.
IrishGuy, I'm getting the inventory figure from the Delta/MRIS report, along with all the stats in this post. (MRIS runs the multiple-listing service for the area, the source of the data.) And it's not 2.1 months for the Baltimore metro area, it's for the ZIP codes around the BWI area -- or at least that's what the report says. I just checked MRIS's online stats for the Linthicum ZIP, one of the ones near BWI, and came up with 4.5 months.
Posted by: Jamie Smith Hopkins | November 4, 2009 5:22 PM
Re: "Average" - since the average (temp., precipitation, etc.) for weather is 30 years, I wonder how and why 10 years for "average inventory" of homes would be 'ideal'?
And I always find it amazing how so many can make 'factual' statements that are not actually factual - the information is spelled out in the article (i.e., IrishGuy's comment on average inventory in Baltimore [spelled out in the article] vs. the average inventory in the BWI area [also spelled out in the article[).
Posted by: Mike in Baltimore | November 5, 2009 1:29 AM
Mike, I'd love to see 30 years worth of inventory data. Alas, MRIS only began tracking the Baltimore market at the end of the '90s, and I've never found an earlier source of data for anything but home prices. (If anyone's found something, please do let me know!)
Posted by: Jamie Smith Hopkins | November 5, 2009 9:07 AM