The Baltimore-area housing market, Nov. '09 edition
Assuming it's not extended again -- and the credit's chief promoter in the Senate swears this is it -- then it will stop being a factor in new contracts after April 30, the deadline to sign.
Economist Dean Baker, who warned of the bubble years before it popped, says he expects the market will take another hit soon. He actually expects it before the credit expires, because he thinks the lure of the original $8,000 credit convinced people who would have bought next year to buy this year, thus decreasing next year's pool of potential buyers.
John Burns Real Estate Consulting, which advises the home building and real estate industries (some of you know the firm for its "housing cycle barometer"), is more optimistic. Steve Dutra, vice president of information there, expects modest sales improvement and flat to small decreases in prices next year in the area. (Still, Baltimore does top the barometer list of "areas of affordability concern," calculated by comparing metro areas to their historical norms.)
Kenneth Wenhold, Mid-Atlantic regional director of Metrostudy, another firm that advises home builders, has his own analysis of our area:
"Originally I wrote that we did not expect to see Baltimore tighten up as quickly as Maryland, [but] the last two months of data shows that it has the potential to tighten up just as rapidly, and it seems to be making up for lost time. At this rate, we could see Baltimore, Anne Arundel and Harford Counties at equilibrium by the beginning of spring if this momentum is maintained."
He expects some post-credit "hangover" but thinks it will be better coming in the summer than the usually slow winter.
What's your prediction for the housing market when the tax credit ends?
Do you think, on balance, the incentive will have been helpful, harmful or neutral?