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September 29, 2009

"Sticky" land prices

It takes less money than it did in 2006 to put a house together, thanks to a decline in the cost of raw materials. But what about the land you need to put that house on?

"Land prices are another story," says Kenneth Wenhold, director of the Mid-Atlantic region for Metrostudy, a housing-industry market research firm. "They're very easy to go up. It's very hard for them to go down."

In economist-speak, they're "sticky." (So, economists say, are home prices, though not as sticky as many assumed three years ago.)

"We really haven't seen significant declines" in sale prices, Wenhold said. "There are a lot of people who are shopping properties, and the prices might be discounted slightly, but not to the extent that the market will bear."

He has an interesting point to make about Maryland's situation.

Continue reading ""Sticky" land prices" »

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (0)
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About Jamie Smith Hopkins
Jamie Smith Hopkins, a Baltimore Sun reporter since 1999, writes about the regional economy. Her reporting on the housing market has won national and local awards. Hopkins is a Columbia native and has lived in Maryland all her life, save for 10 months spent covering schools in Ames, Iowa.
She trained to become a wonk by spending large chunks of time as a geek and an insufferable know-it-all.
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