What's the biggest game in town? The federal government. Which is why President Obama's proposal to freeze federal employees' salaries for two years sent shivers down the backs of state budget analysts -- and why locals should pay attention.

Economists have been warning Maryland that the mounting federal deficit would eventually hit home. The state has disproportionately benefited from federal spending, which means disproportionate pain from freezes or cuts.

In the same vein: Defense Secretary Robert M. Gates's declaration earlier this year that the military needs to rein in spending -- including contracting, a big part of Maryland's economy.

As Richard Clinch of the University of Baltimore notes, salary freezes won't hurt as much as layoffs, but they will be a drag on economic recovery. (People tend to buy less if their wages stagnate. That includes houses -- which is why you're reading about this on a real estate blog.)

Economist Anirban Basu thinks state officials shouldn't say "whew, glad it wasn't layoffs" and move on to other problems. He figures federal job cuts are eventually inevitable. Now, he argues, is the time for the state to work on becoming less of a company town by bulking up its private sector.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (12)
Categories: The economy
        

Photograph of the Washington Monument by Baltimore Sun photographer Gene Sweeney Jr.

The ayes have it: Your pick for the symbol of Baltimore is a landmark with a name that makes most Americans think of an entirely different city.

The Washington Monument, built between 1815 and 1829 in the city's Mount Vernon neighborhood, actually predates the better-known obelisk constructed in George Washington's honor in the city that bears his name. Baltimore's arguably cooler Washington Monument was the most popular choice in the (far from official) Wonk poll, with 21 percent of votes cast.

Second: The star-shaped Fort McHenry, of national anthem fame, with 17 percent of the vote.

The Bromo Seltzer Tower came in third, with 13 percent, followed by the Natty Boh brewery building, at 11 percent.

The various choices -- there were more, including Camden Yards (10 percent) and the National Aquarium (9 percent) -- were all suggested by readers.

One that wasn't on the poll but proved a strong write-in candidate was the Domino Sugar sign, which got 10 votes -- about 4 percent. (To put that into perspective: the Battle Monument, which is actually on Baltimore's flag, got 2 percent of the vote.)

Several readers wrote in the rowhouse, which is certainly vintage Bawlmer. "Especially one that is covered in formstone," wrote Pete from Highlandtown.

And one person (or perhaps not a person?) wrote in the Male/Female sculpture, that much-maligned bit of public art at Penn Station.

A separate poll asked you what you thought of the metal sculpture proposed for the redevelopment of Westport in Baltimore, the news item that originally started this discussion about symbols. Thirty-one percent dislike the sculpture, 30 percent can take it or leave it, 22 percent hate it, 13 percent like it and the rest -- about 3 percent -- love it.

That's a thumbs down from just over half and a thumbs up from 16 percent, with the rest saying "meh."

Thanks for playing, folks. That was fun. Care to start a debate about the symbol of Maryland?

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (5)
Categories: Architecture/art
        

The holidays are always the low point of the year for home buying -- people have other things (and other sorts of purchases) on their minds.

But some hardy souls are buying and selling real estate.

Are you in that group, either buying, selling or trying? Do you prefer this time of year, or are you participating in a kicking-and-screaming sort of way?

If you're hitting the pause button, when will you return to the fray?

The last question of the day went well. Thanks to all who shared humorous, strange and stomach-turning tales of the oddest homes for sale they've ever seen. I laughed out loud at the story of the house that seemed plucked out of 1984.

Happy Thanksgiving, everyone. You readers are part of what I'm thankful for.

Posted by Jamie Smith Hopkins at 1:00 AM | Permalink | Comments (11)
Categories: Question of the day
        

About 120 homes sold for at least $1 million in the Baltimore metro area during the first half of this year. Most expensive: $3.9 million in Baltimore County. (The house pictured above, part of the Sun's "top properties" photo gallery, sold for $1.37 million in Edgewater this spring.)

How does that compare with earlier days, I wondered? So I checked. One of the nice things about swimming in numbers -- being able to satisfy your curiosity.

Pricey sales are actually up quite a bit from the first half of 2009, when 83 homes sold in that high-end category, according to Metropolitan Regional Information Systems data.

But they're down a lot compared with the first half of 2005 -- which probably won't surprise you all, since that was the height of the bubble. More than 230 homes sold for at least $1 million during those six months, nearly twice as many as in the first half of this year. And the top of the top was pricier, too: $5.2 million for digs in Anne Arundel.

That doesn't mean there's nothing really pricey up for sale at the moment in Maryland. There's this "lodge," for instance.

And lots of people are hoping their homes will end up in the $1 million sales club -- 610 as of October in the Baltimore metro area. Of those, 10 have asking prices of $5 million or more.

The $1 million-plus crowd is just one price category, so these stats don't fully answer reader Chappy10's question about how sales have changed in the various ranges in the last several years. But it was the quickest and easiest: a lot less to tally than other prices. I do plan to do a full analysis when time allows, Chappy10.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (0)
Categories: Housing stats
        

In today's topsy-turvy housing market, the number of homes that soon could be for sale is just as important to know as the number that actually are.

Here's why: The so-called "shadow inventory" of seriously delinquent borrowers whose properties are in danger of landing on the housing market in Maryland are so numerous that these homes would take a full two years to find buyers at August's pace of sales, according to a new report from real estate data firm CoreLogic.

That's the worst in the nation -- in part because Maryland has been hard-hit by the foreclosure crisis, but also because the pace of sales dropped faster here than in the country as a whole after the federal homebuyer tax credit expired.

CoreLogic, which calculated the shadow-inventory figure by analyzing the number of homes whose owners were at least three months behind on their mortgages, said the top states after Maryland (at 24.4 months) were New Jersey (24.1 months), Illinois (23 months), Florida (20.8 months) and Georgia (19.5 months).

As a region, the Baltimore metro area was somewhat better off than the state as a whole. Its 18.3 months of supply ranked it 17th among the 50 largest metro areas. (Miami was tops, at just over 33 months.)

"The weak demand for housing is significantly increasing the risk of further price declines in the housing market," Mark Fleming, CoreLogic's chief economist, said in a statement. "This is being exacerbated by a significant and growing shadow inventory that is likely to persist for some time due to the highly extended time-to-liquidation that servicers are currently experiencing."

Economist Sam Khater with CoreLogic said in an email that the homebuyer tax credit "has really made analyzing the market tricky."

"Absent the impact of the tax credit, traditionally the largest months’ supply have been in the distressed states" such as Florida, Michigan and California, he wrote. "After the tax credit expired, sales collapsed throughout the US, but especially in the upper segment of the price distribution. Therefore states with above average sales prices (especially NJ/MD) experienced a collapse in sales that was larger than the US. This caused states like a NJ or MD to experience pronounced increases in months’ supply."

But how long will the "tax credit hangover" last? That's what a lot of people would like to know. The assumption is that home sales that would be happening now and into early 2011 instead were made late last year and early this year as buyers rushed to get up to $8,000 apiece.

If so, and home sales pick up the pace after early 2011, then the months' supply of shadow inventory will recede in Maryland.

Only assuming the number of seriously delinquent borrowers doesn't get worse. (At last count, fewer Marylanders were newly falling behind.)

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (11)
Categories: Distress sales, The foreclosure mess
        

Here's the mortgage mess, Maryland-style, in a snapshot -- a chart that shows the growth in the number of homes whose owners are at least one payment behind.

It's been trending down a bit this year, good news if that continues. The 3 percent drop in the summer was the first year-over-year decrease since 2006. But I'm not hearing a lot of optimism out there about the possibility of big improvement soon, given the state of unemployment.

(These figures, in case you're wondering, are drawn from a Mortgage Bankers Association survey that covers nearly 90 percent of loans outstanding. The statistics aren't grossed up, meaning that the tally above is most but not all delinquencies.)

From the beginning, some firms have profited off the crisis by taking homeowners' money to negotiate for loan modifications but doing little or nothing. The Federal Trade Commission issued new rules last week banning fees until a loan agreement is hammered out that the homeowner finds acceptable. It also announced that it had convinced a federal court to temporarily halt operations at a Halethorpe mortgage-relief company that the agency said was taking advantage of clients.

A mortgage investors' group, meanwhile, contends that mortgage servicers -- the organizations receiving modification requests -- are themselves profiting when they choose to foreclose.

Mortgage 101 for those whose heads are spinning: Mortgage investors own the loans. Mortgage servicers oversee those loans for the investors, collecting the monthly payments and dealing with delinquency.

It should be noted that the major servicers harm homeowners while benefiting themselves in the following ways:

Servicing Fees: Servicers generate significant servicing and late fees throughout the delinquency and foreclosure process. They can be reluctant to find quick sustainable solutions for homeowners. This is clearly evidenced by long call waiting times and high call abandon rates that homeowners experience when calling servicers.

Profits from Affiliated Companies: Servicers generate profits through affiliated companies during the process of repurchasing, insuring and liquidating homes from distressed homeowners. Servicers can be reluctant to aggressively pursue short sales and other viable options to foreclosure due to these above-market fees generated by affiliated companies.

Second Liens: Servicers own the second liens behind the first liens they service for investors. Their interest in the second liens can cause them to advise homeowners to defer payments on the primary mortgage while aggressively collecting on second liens to avoid losses to their own portfolio and balance sheet.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (8)
Categories: The foreclosure mess
        

Developer Pat Turner's idea of putting a 236-foot-tall metal sculpture in Baltimore's Westport community to create a "symbol" of the region a la the Eiffel Tower got you all thinking about what art or architecture symbolizes Baltimore now.

I've put all your suggestions in a poll. Vote on your favorite:

And weigh in on the proposed Westport sculpture (pictured above):

Commenters pulled no punches:

"We need thoughtful art more than a chopstick explosion," said Wonk reader brent.

"As blunt and simple as He/She may be, at least it's somewhat welcoming," wrote B, referring to the much maligned "Male/Female" sculpture at Baltimore's Penn Station. "This 'chopstick explosion" (I LOVE that) looks like it's going to stab or grab and eat anyone who gets too close."

Allen says "it kind of looks like a statue you would put on top of a nuclear waste repository to invoke danger."

Jamie Hunt shared a quote: "We shall see, stretching over the entire city, still thrilling with the genius of so many centuries, we shall see stretching out like a black blot the odious shadow of the odious column built up of riveted iron plates."

But that's not about the Westport sculpture. "That's from a letter written about the Eiffel Tower, which opened in 1889," Hunt wrote. "It's heartening to know my fellow Baltimoreans are as surly and critical as Parisians."

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (14)
Categories: Architecture/art
        

"A Chinese housing bubble is not like an American housing bubble," writes colleague Jay Hancock, who is right now in that country.

I'll let him tell you what he means, but here's a hint: They've got a completely different sort of vacancy going on there, the kind that wouldn't be unfamiliar to action-figure collectors who never lay a finger on their toys.

Posted by Jamie Smith Hopkins at 9:22 AM | Permalink | Comments (0)
Categories: Real estate investing
        

So an Eastern Shore home -- and its thousands of acres -- is on the market for $30 million. But what's the most someone has ever paid for a house in Maryland?

Answer: $15 million. At least, that's the most paid for a home changing hands on the multiple-listing service, according to Metropolitan Regional Information Systems.

The 11,500-square foot house, built in 1986 on a little over 4 acres, is located in Potomac, a Montgomery County community usually preceded by the adjective "tony." The current owner bought it in August 2005, just about the peak of the market as measured by sales pace.

Here's the aerial view -- you can get to the street view from there.

MRIS has records of seven other home sales in the state for $10 million or more: four in Talbot County (Eastern Shore gathering place of politicos), one in Queen Anne's County, one in Cecil County and an additional one in Montgomery County.

Sales that weren't on the multiple list aren't counted in this tally. I'm guessing this non-MLS group includes author Tom Clancy's $12.6 million purchase of a super-sized Ritz-Carlton condo, created from three penthouses -- unless it's counted as a trio of buys for an average of $4.2 million each.

Just to bring this back to everyday reality: Half the homes sold in the Baltimore metro area last month went for less than $240,000.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (1)
Categories: Housing stats
        

A Baltimore developer wants to put a 236-foot-tall "illuminated metal sculpture" in Westport, colleague Ed Gunts reports.

To put Pat Turner's proposal into perspective: It would reach as high as his Silo Point condo tower and, he says, would be one of the tallest works of art in the country.

Why?

"We want the sculpture to be the center of attention of the project," he told the [city's Public Art Commission]. "We're redesigning the project around the sculpture. It does for Baltimore what the Arch does in St. Louis. It would become a symbol of the region."

More details here.

What do you think the symbol of the region is now, in terms of either public art or architecture? Could we use something new?

Posted by Jamie Smith Hopkins at 1:00 AM | Permalink | Comments (20)
Categories: Architecture/art
        

Nearly 40 percent of Baltimore homes listed for sale have had at least one price reduction, compared with 27 percent nationally, according to real estate site Trulia.

Baltimore's figure is a record high for the city -- at least for the last 18 months, which is when Trulia started tracking asking-price movements. Fourteen other cities broke their previous records as well. Check out the map above, which Trulia put together. (The message that went with the asterisk didn't copy over, but it's just a heads-up that the records go back a year and a half.)

Baltimore ranks fourth among the 15 cities with record highs. Minneapolis is No. 1 with price reductions on 46 percent of listings.

Trulia looked at homes for sale on Nov. 1 and calculated which had at least one price reduction within the previous 12 months. It did not include bank-owned properties.

In October, 35 percent of homes on the market in Baltimore fell into the price-reduced category.

Our neighbor to the south, Washington, has fewer sellers who are dropping their asking prices. It was 30 percent there as of Nov. 1, vs. Baltimore's 39 percent.

Average price reduction in the city: 12 percent. Trulia tallies that up as a grand total of $50 million off.

The site says it's not unusual to see increased price reductions this time of year, as people gear up for the holidays and put off home buying. But it noted that other factors are at play, too:

"The market is flooded with distressed homes that are priced to sell and individual sellers are having a tough time competing," Tara-Nicholle Nelson, Trulia's consumer educator, said in a statement. "These dynamics, along with a shallow pool of active buyers, are leading to increases in price reductions."

What are you seeing out there?

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (10)
Categories: For sale, Housing stats
        

Quick update on the GrandView at Annapolis Towne Centre auction:

Organizers report that 33 condos were sold on Sunday, more than the 30 they had planned to put on the block. Prices ranged from $275,000 to $610,000, not including the 5.5 percent commission.

That's well below the original listing prices of $415,000 to $995,000, but it's above the minimum bids of $148,500 to $308,000. 

More than 400 people showed up for the event, organizers say.

About 50 of the tower's 150 units had changed hands when the auction was announced in October.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (3)
Categories: Auctions
        

About 5,000 of Baltimore's vacant and uninhabitable homes are on mostly occupied blocks, the city says. When abandonment and residents intersect, things can get ugly.

A family in Wilson Park has been struggling for months and months with the vacant rowhouse next door, which damaged their house. The neighboring home's pipes burst early this year, flooding the Malaneys' basement. Last year, while it was still occupied, its roofing material ripped off during a storm, letting water into the Malaneys' walls and ceilings.

Read more about the Malaney family's woes here.

The city took the fairly unusual step in this case of spending $18,500 to replace the abandoned home's roof and remove moldy drywall, insulation and carpet, hoping that would help the Malaneys' situation when going after the owner proved fruitless. 

Housing officials say that's not an expense they can swing for most vacant properties. In the past three fiscal years, the city stabilized 26 abandoned properties -- half of them last year. More common: "partial" demolitions, where the city removes an unstable portion of a vacant property. It went that route with just over 450 homes in the last three fiscal years, 137 of them last year.

Posted by Jamie Smith Hopkins at 12:01 AM | Permalink | Comments (13)
Categories: The foreclosure mess, Vacancies
        

If you enjoy soaking in raw data about the local housing market, you'll want to update your website bookmarks.

Metropolitan Regional Information Systems, which runs the area's multiple-listing service, has moved its publicly available home-sale statistics to a different site as part of its new RealEstate Business Intelligence arm. Most of the monthly data you could find on the old site (number of sales, prices, pending deals) has been moved over, with the rest slated to come later, the RBI folks say. There's new stuff there, too.

RBI calculates the month-over-month change for you as well as the usual year-over-year, for instance. It also put together charts that show at a glance the change in the last several years by home sales, pending deals, average and median price, etc. And there's a list of the biggest movers (up and down) in the Baltimore-Washington area by price, sales and the like.

If you prefer videos, you'll find some here.

The firm is set to roll out more options this week as it promotes a new "premium product" for customers -- agents, brokers, appraisers -- that is designed to make slicing the data simpler. (What's the trend for four-bedroom Colonials in Baltimore County, for instance.)

If you're not in that target audience, the revamped site will still mean more to look at than you had access to before, said Jonathan Hill, president of RBI. There's a heat map for the region that you can adjust to show days on market, new listings and other useful statistics, plus you'll get a ranking of every jurisdiction covered by MRIS.

Hill said RBI is also making available to all visitors some monthly reports that used to go only to MRIS customers.

RBI was created to make better use of MRIS's data, Hill said. "Aside from looking at the monthly picture, we really haven't taken the opportunity to delve deeply into the data and mine the data and look for trendlines," he said. The company wanted to change that, and to offer more than a backwards look at the housing market.

By analyzing the search terms real estate agents and consumers are using, Hill said, RBI can try to get a handle on future trends. "Because the things that everybody's looking at today are the things they're going to be writing contracts on tomorrow, the next month," he said.

I got a preview of the site that's going live this week, but I'm more familiar with RBI's current stats offering, which recently replaced the old MRIS statistics page (now showing the dreaded "Page Not Found" warning). What's missing is the ability to download to Excel -- doh! -- but Hill says they're working on that. Also yet to appear are statistics for the Baltimore metro area before 2006, which Hill says will migrate over later.

Once you've romped among the stats, weigh in on whether you find the site more or less useful than its predecessor.

Posted by Jamie Smith Hopkins at 1:00 AM | Permalink | Comments (0)
Categories: Housing stats
        

An Annapolis homeowner writes in with a question that some of you are probably pondering yourselves:

We bought a house in March 2007 - towards the end of the boom. Anyway, the value of our home has decreased by about 23% on a good day and as low as 45% according to our bank (not the mortgage holder).

Right now, we do not need to sell our home however my husband's career moves us around quite a bit. Where can we go for information to know what our options are in the event we need to sell before the value goes back up? We were thinking of a real estate attorney but are a little nervous with all the people trying to take advantage of others in a bad situation.

We want to be ahead of the game as much as we can so we are starting now instead of "too late"!

Suggestions? Personal experiences?

I pointed her toward the network of "low bono" attorneys with the nonprofit Civil Justice in Baltimore as one possible starting point, but I thought you all might have good ideas about how underwater borrowers might plan for the future.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (13)
Categories: Help wanted, Underwater
        

If you qualify for an FHA-insured mortgage, you're supposed to get basically the same rate no matter what your credit score, how much you're borrowing and the like.

But a study released this week by a new community-organizing group says that Baltimore residents getting FHA mortgages in 2008 were twice as likely to get high-cost loans if they lived in minority neighborhoods than if they lived in white neighborhoods. And residents in low-income neighborhoods were three times more likely to get high-cost FHA loans than residents in upper-income areas.

"Because of the nature of FHA lending, this disparity cannot justifiably be attributed to the risk factors of different borrowers," says the report, released by Communities United, a new group with chapters in Maryland, D.C. and Ohio formed in part by people who used to be involved with the now-defunct ACORN.

But there's an X-factor in all this: the year in question.

A lot of really unusual things happened in 2008, from the problems that led to the country's financial meltdown to the ripple effects of that crisis. An earlier Federal Reserve analysis of the dataset Communities United relied on suggests that this roller-coaster ride threw more FHA loans into the "high cost" category in the later part of 2008 because the benchmark they were measured against took a dive, not because borrowers were taken advantage of.

Mortgages were labeled high cost in 2008 if they were at least three percentage points above the rate for Treasury notes. Those rates slumped in the latter half of 2008 as spooked investors fled to safer havens.

Robert B. Avery, senior economist at the Federal Reserve and one of the authors of the Fed analysis, says it wouldn't take much to bump an FHA loan into "high-cost" territory under those circumstances. (Cost is measured by annual percentage rate -- APR -- and includes not just the interest rate but also points and FHA's upfront premium, if it's rolled into the loan balance.) Loans that wouldn't have been dubbed high cost in the beginning of 2008 ended up in that category later in the year, he said.

"We have raised this caution that you must be very careful in using the FHA pricing data in 2008," Avery said. "It is highly distorted."

Both Communities United and the Federal Reserve relied on Home Mortgage Disclosure Act data, but the Fed had an advantage -- it could analyze loans by the exact date they were taken out, information that isn't included in the public release. Avery said he and the other researchers used that extra data to look at trends in FHA and VA loans based on whether they were originated before or after Treasury rates fell in 2008.

"There's not a significant difference in the pricing of high-rate loans between blacks and whites once you make this adjustment," he said. Or, to put it another way, "Once you make this adjustment to try to correct for this flight to quality, you'll see there aren't that many high-rate loans," period.

He's not arguing that Baltimore didn't have any FHA-cost problems, "but if I was a judge, I'd need more than just the gross HMDA numbers."

Here's a PDF of the study for Communities United, written by Jordan Ash of Community Research for Action, who is a former ACORN regional director in Minnesota. (The report is dated July, but Communities United released it locally this week.)

Ash, who referenced the Fed study in his report, doubts that the disparity is simply about the Treasury volatility in 2008. It strikes him as odd that this would mean more higher-cost FHA loans for some groups rather than all.

"That would seem to be something that would affect everybody equally -- unless there's some other explanation for it," he said in an interview.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (0)
Categories: Mortgages
        

Here's a snapshot of how the housing market in the Baltimore metro area looked in October:

--Home sales dropped 30 percent vs. a year earlier, when buyers were rushing to get the first-time home buyer tax credit

--The number of homes changing hands totaled less than 1,600, the smallest amount in the month of October for at least 12 years (that's how far back the records go)

--Average prices fell just over 1 percent, to about $272,000 (though remember to take this calculation with a grain of salt)

--"Ouch" stat of the day: It would take four-and-a-half years to sell all the $1 million-plus homes on the market at the current pace of deal-making. (Home sales in this price range dropped, unlike in September.)

The new figures, released by an arm of Metropolitan Regional Information Systems, show the drop in sales ranging by county. The biggest decline was 39 percent in Baltimore County. The smallest was 19 percent in Howard County, closely followed by Harford County's 22 percent drop.

Every time I write about home prices in the Baltimore metro area, someone inevitably looks at the average price and thinks that's for the city. So just to be clear: Metro area. Metro area. Anne Arundel County, Baltimore City, Baltimore County, Carroll County, Harford County and Howard County. (The federal definition includes Queen Anne's County as well, but most local number-crunchers leave that Eastern Shore jurisdiction out.)

You can see the average price by county (and Baltimore City) right here.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (6)
Categories: Housing stats
        

A Baltimore homeowner who fell behind on her mortgage payments after her property taxes unexpectedly spiked protested in an attention-grabbing way this week: She went on a hunger strike.

Lauren Rymer started just after 7 a.m. Monday and spent an empty-stomach day camped out in Annapolis, trying to get an audience with Gov. Martin O'Malley and talking to passersby who wanted to share their stories of economic woe.

By the time she ate something at 5 p.m. Tuesday, she'd had a foreclosure alternative offered to her by the state housing department, talked to someone from O'Malley's office about the tax problem and given interviews to a bevvy of media from WBAL to the Huffington Post to MSNBC about her hope that elected officials will do more to help Americans avoid foreclosure.

"Awareness has been raised on this issue, so I feel like the strike was worth it," she wrote on her Hungry4Home Twitter feed Tuesday afternoon.

Rymer, 32, who works for a nonprofit in Baltimore, bought her two-bedroom home in Upper Fells Point four years ago. She said her monthly payment started off at $1,500, including taxes and insurance, which she could afford. But it jumped to $2,100 this year after her property taxes skyrocketed, she said, and that was beyond her ability to pay.

The state Department of Assessments and Taxation, which investigated at the O'Malley administration's request, says it's the result of a little-known exception to the tax break that caps homeowners' property-tax increases at 4 percent a year in the city.

Homeowners don't get the Homestead tax credit on new improvements worth more than $50,000. State law dictates that they'll get hit with the full assessment for that work, phased in over three years, before the Homestead credit goes into effect for the renovated portion. (UPDATE: When I asked for more details, state assessors clarified that the threshold was $50,000 when Rymer purchased her home but increased to $100,000 in 2009.)

Rymer's home was newly rehabbed when she bought it. Unfortunately, state assessors say, the city did not send a copy of the permits their way when the work was done. Thus the state didn't up the taxable value until two years later, when her neighborhood was being reassessed.

Her loan is interest-only through 2011, so she was expecting a $218-a-month increase next year. But the more than doubling of her taxes between 2008 and this year came as a shock. She thought she was protected from big jumps by the Homestead credit.

The state says it sent a notice in the fall of 2008 to inform her, but she doesn't remember seeing anything like that, and it wasn't until this summer that she realized what happened to her taxes. She's sure the $234,000 assessment is far above the property's true value now, but an appeal wouldn't help her decrease her taxes until next July.

"Obviously if this was something I could have foreseen, I wouldn't have purchased the home," Rymer said.

Her mortgage servicer told her she didn't qualify for a loan modification. So she called the state, which owns her mortgage and suggested she put her home on the market as a short sale. She did -- for $125,000, far below the $259,000 she'd paid.

No luck.

"It's not selling," she said.

On Election Day, she got home from voting for Gov. Martin O'Malley to discover a notice on her door that a foreclosure action had been filed and her home could be auctioned off in 45 days.

Perhaps she really didn't have any options, she thought, but she wanted to put a face to the foreclosure statistics. She ate a piece of chicken when she woke up Monday morning and headed to the state capital with a sign declaring, "Hunger Strike Against Foreclosure Day 1."

The state Department of Housing and Community Development, which runs the Maryland Mortgage Program, brought her in for a meeting toward the end of the afternoon. She said officials suggested that she hand over her deed in lieu of foreclosure, often seen as a better option if the noteholder agrees not to go after the former homeowner for the difference between the home's value and the mortgage balance. (The state told her it wouldn't pursue a deficiency judgment but said the mortgage insurer could, probably for less than $10,000.)

The housing department told me it couldn't discuss her situation but said in a statement that it "will always work with homeowners to explore every viable financial option."

Shaun Adamec, a spokesman for O'Malley, said the department is still looking into her case to see if there are alternatives that would let her stay in the home.

"She's pretty far along in the process, which isn't always the best scenario for helping, ... but there are still options," said Adamec, adding that O'Malley has shepherded through "some of the most innovative and sweeping reforms in the nation" to foreclosure laws.

Rymer said that handing over her deed might be her only way to avoid a foreclosure auction, and she's glad she was given an alternative. Still, it makes no sense to her why it's in anyone's financial interest to foreclose on her in order to sell her home to someone who will make far lower payments than her original $1,500 a month. (That's assuming it changes hands for no more than $125,000, the amount she hasn't been able to get any buyers to bite on.)

Other struggling homeowners, she figures, might have more options than she does. Part of her goal with the hunger strike was to exhort politicians to do more to oversee loan modification efforts, making sure people who should qualify actually get one. 

"I don't have a lot of options, and I accept that," she said. "But there are a lot of people who could have options and banks are moving straight to foreclosure." 

Tuesday night, she added that she hopes the coverage she got will give other homeowners incentive to speak up, too. "I don't think there's enough activism, people exercising their First Amendment rights -- people think they can't effect change," she said.

UPDATE Wednesday night: Rymer talked to her mortgage servicer again today, and here are the details, for those of you trying to make the math work out.

Her original payment was about $1,640 -- she'd incorrectly remembered it being lower when I talked to her more than 24 hours into her hunger strike. That figure rose to $1,750 in 2008, fell (oddly) to $1,720 in 2009 and then jumped to $2,157 (a bit more than she'd remembered) this March.

As you might recall, her property taxes started rising significantly in 2009, not 2010. Because her mortgage servicer didn't adjust her payments until this year, she had an escrow shortage of nearly $3,100, she said she was told -- further increasing her total.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (47)
Categories: Homestead Property Tax Credit, The foreclosure mess
        

The slump in home prices was less severe in the Baltimore metro area over the past four months than it was in most large regions, according to a new analysis that compares recent housing-market performance with the spring period.

Prices fell less than 1 percent in the metro area, ranking the metro area sixth, says real estate data firm Clear Capital. One other metro area had a smaller drop -- San Jose, Calif. -- while four posted price increases.

That's a turnaround from earlier in the year, when the Baltimore area showed up on Clear Capital's "lowest performing" list. The region apparently didn't feel the upward pull of the first-time home buyer tax credit as much as some markets, places in hangover mode now that the federal incentive is gone:

Clear Capital's "lowest performing" list is peppered with "lower-priced markets that reacted positively to the tax credits of the last eighteen months, and are now giving back the short term gains, and then some," the firm says.

The number of home sales slumped in our metro area post-credit, however. In May, the month after the deadline to sign contracts, new pending deals declined more than 30 percent compared with a year earlier and even more sharply vs. April, according to separate figures from Metropolitan Regional Information Systems.

Clear Capital's figures do show prices in the Baltimore metro area down 4.7 percent year-over-year, despite the smallish quarterly drop. That's out of sync with most of the regions on the "highest performing" list -- two-thirds are up vs. a year ago.

Here are those top 15 markets, as measured by quarter-over-quarter change:

Thoughts?

Clear Capital draws its sales figures from assessors' and recorders' offices, calculating price by comparing repeat sales of the same homes over the years. In order to include October, with data that could be incomplete, the company throws in an extra month of sales for balance -- thus the "four months vs. the previous three" comparison.

We'll get to see October housing-market figures for Baltimore and all its suburbs on Wednesday -- from prices to the pace of sales -- when the firm that runs the multiple-listing service releases its monthly statistics.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (2)
Categories: Housing stats
        

A crime analysis for a consumer-finance website dubs Locust Point the safest large neighborhood in Baltimore, with residents less likely to be victims of violence or serious property crimes than people living in most other parts of the country.

"As it turns out, some big cities contain neighborhoods that are among the safest of any place in the nation, hopefully breaking stereotypes," WalletPop, the website, says in its announcement of the findings.

Locust Point, a neighborhood with deep blue-collar roots, has a location alongside Baltimore's waterfront that has brought it high-end residential development in recent years.

WalletPop, which relied on NeighborhoodScout for the data and analysis, says it ranked the safest neighborhood of at least 1,000 people in each of the nation's largest cities. Those neighborhoods tended to be either wealthy or "more modest income neighborhoods with many tightly-knit working class families."

The chances of becoming a crime victim in a year of living in Locust Point are 1 in 84, better odds than in 70 percent of U.S. neighborhoods, WalletPop said.

The site says it saw similar themes across the country:

Surprisingly, many of the neighborhoods [NeighborhoodScout] discovered are substantially safer than neighborhoods in the suburbs. Some of these same cities are also home to the most dangerous neighborhoods in America, underscoring the importance of looking at neighborhoods, and not passing judgment on entire cities. For safety, it really is all about your location, not just your city or your zip code.

So is Locust Point actually the safest place in Baltimore? It depends on your definition. WalletPop says neighborhoods with fewer than 1,000 residents were excluded from the analysis, which is why Locust Point is listed as No. 3 overall in the city but topped this particular ranking.

There's also modeling at work. NeighborhoodScout's parent, Location Inc., says it uses "proprietary computer models developed by its expert analysts to statistically estimate the number of violent crimes and property crimes for every neighborhood in the U.S." That's designed to try to deal with less-than-ideal data, including "the lack of specific locations for crimes reported by most law enforcement agencies."

Do you agree that Locust Point is the safest of Baltimore's larger neighborhoods?

Where do you feel safest?

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (24)
Categories: Neighborhood and neighbors
        

In the market for a 6,250-acre estate? A hedge-fund founder has listed his -- in Cambridge on the Eastern Shore -- for $30 million.

The Wall Street Journal reports that owner Paul Tudor Jones (net worth: $3.2 billion) has used the property as a hunting retreat.

The house is a 14,000 square feet "lodge," with 11 bedrooms, 10-and-a-half bathrooms, several fireplaces and amenities ranging from a home theater to an indoor basketball court. The property also has a barn, stables and a "private lake," according to the Sotheby's listing. (The site helpfully lets you convert the asking price into anything from Aruban florins to Turkish liras.)

The guest living room has trees -- presumably not live -- along the walls, branches stretching up to the ceiling.

I don't normally blog about homes for sale, but then I don't normally see homes for sale with a $30 million asking price. And interior trees.

Posted by Jamie Smith Hopkins at 4:56 PM | Permalink | Comments (7)
Categories: For sale, Unusual homes
        

We all know there are some unusual, amusing, hair-raising, stomach-churning or just plain odd homes out there -- for sale or rent. Maybe you've seen one. Maybe, if you've been looking for a new place for a while, you've seen a lot.

Tell your tale. C'mon, share.

It's not exactly the "High Comedy Listing of the Day" as suggested by Wonk reader elweedz -- I don't like to point and laugh at identified folks, so you can imagine how little I like most reality TV -- but hey, there's no harm in writing about "can you believe this" experiences. Including odd-but-oddly-awesome places. (See enough off-white walls, granite countertops and stainless steel appliances, and maybe you'll want something out of the ordinary for a change of pace.) 

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (12)
Categories: Question of the day
        

What's the city's No. 1 housing problem? Most people would say it's the sheer number of abandoned properties, emptied out as the owners died, residents left, people were foreclosed on or investors walked.

As colleague Julie Scharper reports, Mayor Stephanie Rawlings-Blake has unveiled a vacancy-fighting plan to "expedite the sale of city-owned vacant properties, lure homebuyers with more than $1.5 million in incentives and ratchet up code enforcement on vacant homes in healthy neighborhoods or those primed for development."

It's no easy problem to attack, as Baltimore's previous mayors can attest. And some ideas have been tried before. The city announced in 2005 that it would up the ante on code enforcement on otherwise promising blocks marred by vacant homes, Scharper notes.

Some residents favor the tear-down route, turning vacant structures into vacant lots that are less likely to catch fire and harbor squatters. Detroit, which has an epidemic of abandoned homes, is trying to raze thousands of them.

Finding the money is tricky, though. Baltimore housing officials say the price tag for demolishing a house ranges between $10,000 and $65,000, depending on factors such as size. Detroit -- which doesn't have the money -- is depending on federal help.

The Dominion Group, one of Baltimore's larger real estate investment firms, thinks demolition is a good idea on "dead blocks." Here's how Dominion officials described the vacancy problem in a report to the city (with hard returns added by me for ease of reading):

Approximately 75% of the vacants are owned by speculators, would-be renovators and Regional and National Banks. In our estimation, a mere 5% of Baltimore’s vacant properties are owned by “True Renovators” who are in the process of renovating or who are attempting to aggregate in a particular block (in order to create economies of scale) so that they can renovate their vacant properties.

The exuberance of the 2005-2007 real estate market brought in buyers from all over and the activity during this period resulted in an unprecedented number of real estate transactions. As the market cooled and then turned down from 2007 to the present, many “investors” got stuck holding real estate that is literally worthless in today’s market. Many of these owners are not from Baltimore City, have no other vested interest in Baltimore City other than a few vacants, and do not have the resources necessary to successfully renovate their properties and put them into use.

The frustrating result of these facts is that it becomes practically impossible to do anything with a block with a high percentage of vacant properties with owners who are either out of town or who lack the resources to move forward and put the property back into use. The block is “dead” for all real estate investment intents and purposes.

How would you attack the vacancy problem?

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (25)
Categories: Vacancies
        

Q: Did any price ranges see home-sale gains in September, despite the overall drop?

A: Why, yes. So glad you asked.

You probably won't be shocked to hear that sales in the under-$100,000 category increased, compared with a year ago, since that's the most affordable to buyers and is also the niche most attractive to investors. But guess what also rose? Sales of $1-million-plus homes.

I analyzed sales data from Metropolitan Regional Information Systems for Baltimore and the surrounding suburbs, and here's what the stats showed: 

Sales of homes priced under $100,000 rose 30 percent, from 208 a year ago to 270 in September.

Also up: homes priced in the $500,000s. Sales in that price range rose 31 percent, to 101 homes.

Sales of homes in the $800,000s remained steady at a grand total of 11. Every other category dropped. (This is according to MRIS's dataset of all sales, which varies a bit from its online report because it's culled at a different time.)

The $200,000s was the most popular price range in September, same as a year earlier. But the buying pool there really shrunk. People picked up 475 homes in that category, compared with 700 a year ago -- a 32 percent drop.

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (4)
Categories: Housing stats
        

Here's how home prices in the Baltimore metro area have changed over the decade, according to a new housing-market index. If it looks like the roller coaster is more up than down, FNC Inc. -- a mortgage technology firm that put the index together -- says you're not seeing things.

Prices in the Baltimore region appreciated more since 2003 than other large metro areas, according to FNC. Using a combination of sale prices, appraisals and property records, it calculates a 7 percent annual increase in our area. U.S. home values rose a little more than half a percent annually over the same period, FNC says.

FNC, which runs the AppraisalPort program used by lenders, explains here how its index works. 

There are a lot of competing indexes out there, each with its strengths and weaknesses.

The Federal Housing Finance Agency, for instance, uses repeat sales and refinancing transactions in order to compare how the same homes change in value over time. That's designed to avoid the apples-to-oranges problem you can get when you simply tally up all the home sales in one period and compare them to all the (mostly different) homes sold the year before.

But the FHFA draws only from Fannie Mae and Freddie Mac data, so it's missing the subprime and jumbo-loan craziness of the boom years. It's also missing all the homes that didn't sell or refinance more than once. That's what Zillow's Zestimates tries to fix by offering estimates on every home, whether it sold or not. Zestimates, though, have been oft-criticized as inaccurate. So it's no easy thing, designing a home-value measurement that's wide-reaching and unimpeachable.

FNC's index, like Zillow's Zestimates, is trying to get at the entire universe of homes: "Since all the properties do not sell, a model must be created to price all of the major attributes of a house (i.e. location, gross living area, age, lot size, bedrooms, bathrooms, etc.) and then compute an estimated market price for each property," it says on its site. "The value of each of the attributes is estimated based on the observed properties that do sell over an extended window."

Because it adds appraisal information to the mix, FNC says its index has "the physical property characteristic data that is often missing from public records." (It has been criticized by appraisers for culling that information from appraisals added to AppraisalPort, as it happens.)

What do you think of this index? Does the value change match up with your sense of the market?

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (5)
Categories: Housing stats
        

It's looking like Maryland has about 85,000 ground rents.

The state Department of Assessments and Taxation is still processing all the last-minute registrations, but it's closing in to the point that it can offer that approximate figure. (It had 70,000 processed the day of the deadline.)

Some registrations have missing information or errors, and the state will send letters to the owners giving them 30 days to respond with corrections. It's projecting that the work will be completely done by Dec. 21.

When the assessors announce that they're all done, you'll know for certain if a property has ground rent -- meaning that the land is owned separately from the house on it -- by looking the address up on the state's property lookup site. See if there's a link to "ground rent registration" near the top right corner.

Three years ago, the state estimated that there were about 115,000 ground rents in existence. Does that mean 30,000 went "poof" on Sept. 30 because their owners forgot or didn't realize they had to register? Well, no, since some of the residents renting the land beneath their homes eliminated their ground rent by buying it out.

But other ground rents did disappear.

"But I did not receive a large number of those [calls]," Young said. "We're at 85,000. That means a lot of people did know."

Charles J. Muskin, whose grandfather's estate included about 300 ground rents, only registered two-thirds of them. (He said he'd been trying to sell -- to no avail -- and was left with too little time to collect the required information for them all.) Muskin said he frequently hears from people who owned small numbers of ground rents and didn't know registration was required.

Muskin sued over the requirement, contending that it was an unconstitutional taking of property. A Baltimore judge ruled in favor of the state last week, saying the registration rule didn't violate the constitution because it does not "retroactively create or eliminate property rights, but instead, prospectively conditions the continued ownership of ground rents on compliance with the requirement of registration."

Posted by Jamie Smith Hopkins at 7:00 AM | Permalink | Comments (4)
Categories: Ground rent