ROCKVILLE, Md.--(BUSINESS WIRE)--The following analysis of the Baltimore Metro Area housing market has been prepared by housing market expert Jonathan Miller of Miller Samuel, based on the July 2011 RBI Pending Home Sales IndexTM released today:
OVERVIEW
More sales contracts were signed in Baltimore last month than any July since 2007 but prices still fell 4.5 percent—the first monthly decline since March. On a month-to-month basis, sales activity dropped more than the seasonal average, suggesting demand is weakening. July sales contracts fell 6.9 percent from June but they are still 24.5 percent above July 2010.
KEY TRENDS
- Most active July housing market in four years. There were 2,407 signed contracts in July, the most since 2007. Market activity was 6.9% below the June total of 2,585 and 24.5% above the 1,934 total in the same month a year ago. The jump from the prior year total was due to the lull in the market in the months following the April 30, 2010 contract signing deadline for the federal homebuyer tax credit and therefore overstates the improvement in the market. The average June to July seasonal decline for the past five and ten years was 3% and 3.5%, roughly half the market decline seen this year in the same period. The likely cause of the larger than normal decline was a consumer pause during the heated Washington DC debt ceiling debate for most of month.
- After three consecutive month-over-month of increases, median sales price declined. Median sales price fell 4.5% to $225,000 in July from $235,500 in June and fell 10% from $250,000 in July 2010. The decline marks the second decline in the past decade that the median sales price declined from June to July. The last time there was a decline in this indicator was in 2007, when median sales price slipped 1.7% over the same period.
- The rate of new inventory entering the market continued to fall faster than the active inventory. Active inventory declined 2% in July to 16,807 after reaching its 2011 peak in June with 17,153, consistent with seasonal patterns. However the rate of new inventory being added to the market fell to a 2011 low of 21.9%. There were 3,673 new listings introduced to the market in July, 9.3% fewer than 4,051 new listings in June and 20.9% fewer than 4,645 listings added in July 2010.
- The absorption rate continued to cool as pending sales decline faster than inventory. The number of months to sell all active inventory at the current pace of new pending sales for July 2011 was 7 months, a slower rate than 6.6 months in June but faster than 9.7 months in July 2010. Despite the decline in active inventory, new pending sales activity declined at a higher rate.
- The time to sell a property and spread between buyer and seller on price was essentially unchanged. Days on market, the number of days from the original listing date and the contract date averaged 114 days in July, nominally more than 112 days in June. The year ago average of 97 days reflected the surge in demand fueled by the federal homebuyer tax credit. Listings discount, the percentage difference between the original list price and sales price was 9.5% in July, nominally above June’s 9% and above 8.5% in July 2010.
The RBI Pending Home Sales IndexTM is a two-year moving window on the housing market using new pending sales and median sales price. It provides unique insight into the state of the current housing market by measuring the number of new pending sales for each month through the most recent month. The results include new pending sales through and including July 2011. The market area includes: Baltimore City, Baltimore County, Anne Arundel County, Carroll County, Harford County, and Howard County.
ABOUT JONATHAN MILLER/MILLER SAMUEL
Miller is President and CEO of Miller Samuel Inc., a nationally-known real estate appraisal and consulting firm. A well-regarded real estate commentator, who frequently appears in national media outlets including the Wall Street Journal, the New York Times, Bloomberg News, CNBC and others covering national and regional housing issues. He has been named “Best Online Real Estate Expert" by Money Magazine and his stringent focus on neutrality has contributed to his recognition by Inman News as one of the most influential real estate bloggers in the U.S. More information on Mr. Miller and Miller Samuel can be found at www.millersamuel.com or follow him on Twitter @jonathanmiller.
For Miller’s latest blog post on how the Standard & Poor’s downgrade will affect the U.S. housing market visit: http://mrisblog.com/2011/08/what-will-the-sp-downgrade-do-to-the-us-housing-market/
ABOUT RBI
RealEstate Business Intelligence, LLC (RBI) is a wholly owned subsidiary of MRIS. RBI is a primary source of real estate data, analytics and business intelligence for real estate professionals with business interests in the Mid-Atlantic region. The full monthly data report for all jurisdictions in the MRIS region, along with charts and graphics, can be found at www.rbintel.com/statistics. RBI is the only company in the Mid-Atlantic region that provides timely, online access to statistical information directly from the Multiple Listing Service (MLS). Visit RBIntel.com or follow @RBIntel on Twitter to learn more.
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