Calling all Sellers – Buyers are Lonely Out Here (Feb. Insider Report)

Redfin’s monthly Washington & Baltimore metro area real estate insider report draws from our proprietary database of information on homes for sale and that just sold, along with insight from our agents to get a sense of what’s going on in the market right now. If you’d like to receive the report via email, just sign up.

We were looking forward to bringing you some good news this month about how spring had “sprung” and inventory had dramatically improved in terms of quantity and quality — but sorry to say, not much luck. It’s more of the same old, same old. The only exceptions were in Prince George’s and Baltimore City/County where year over year inventory is up by 3.1%, 2.3% and 7.7% respectively. “There is still no inventory,” says Jeremy Cunningham, an Agent in Loudoun and Fairfax Counties. “The inventory we are seeing is over-priced with over-confident sellers. They’ve put a 5-10% premium on their properties and are acting like the prom queen from a bad 80′s movie,” says Cunningham. But buyers are savvy, doing their homework and not jumping at the stale over-priced inventory.

It’s Slim Pickins on Inventory

County Compared to January 2011 Compared to February 2010
Washington Area
Alexandria -3.1% -6.4%
Arlington County +0.4% -15.7%
District of Columbia -2.6% -4.1%
Fairfax City -3.3% -32.6%
Fairfax County -3.6% -13.7%
Loudoun County -3.2% -6.2%
Montgomery County -3.8% -4.7%
Prince George’s County -1.9% +3.1%
Prince William County -8.9% -8.4%
Baltimore Area
Anne Arundel County -1.4% -1.6%
Baltimore City -4.3% +2.3%
Baltimore County -1.5% +7.7%
Howard County -3.9% -1.6%

Change in # of Homes (SFH, condos, townhouses) for Sale on February 28th 2011

“Many of the homes have been on the market for more than 90 days,” says Phil Gvinter who works on the Montgomery West team. “It’s very typical for us to receive tour requests from multiple buyers interested in seeing the same house in Bethesda and Rockville in the $350,000 to $650,000 range.” On a positive note, Brent Roberts, an Agent in DC, is seeing a lot more interest from Sellers in getting their home on the market. “We’ve probably seen 10 requests in the past few weeks from sellers who now feel that it’s the right time to put their house on the market,” reports Brent.

Sluggish Sales But Market Starts to Take a Turn

County Compared to Jan. 2011 Compared to Jan. 2011 Adjusted for # Weekdays Compared to February 2010 Compared to February 2010 Adjusted for # Weekdays
Washington Area
Alexandria +5.8% +11.1% +11.5% +11.5%
Arlington County -11.1% -6.7% -20.0% -20.0%
District of Columbia -19.3% -15.3% -16.6% -16.6%
Fairfax City -26.3% -22.6% -17.6% -17.6%
Fairfax County +9.6% +15.1% -18.8% -18.8%
Loudoun County +5.4% +10.7% -9.0% -9.0%
Montgomery County -11.9% -7.5% -7.0% -7.0%
Prince George’s County -12.1% -7.7% -0.6% -0.6%
Prince William County -12.6% -8.2% -21.0% -21.0%
Baltimore Area
Anne Arundel County -23.6% -19.7% -4.3% -4.3%
Baltimore City -33.4% -30.1% -0.8% -0.8%
Baltimore County -24.8% -21.0% -18.3% -18.3%
Howard County -20.7% -16.8% -36.3% -36.3%

Change in # of Homes (SFH, condos, townhouses) That Sold in February 2011

With the exception of Virginia, sales volume is light in most areas in comparison to last month as well as last year. Sales in Fairfax County increased by 9.6% and by 5.4% in Loudoun County since January. The largest declines since January were in Baltimore and Fairfax City and are lower than last year in all areas except Alexandria which experienced an 11.5% gain compared to February 2010. “While it doesn’t compare to last year with the tax credit,” says Marshall Park, an Agent in Alexandria and Fairfax, “we’re seeing a gradual increase in demand and some signs that spring is on the way.”

“Although the numbers don’t show it in Maryland, particularly Montgomery County where sales are down 7.0% from a year ago, we’re back to seeing competitive offer situations and quick sales,” explains Taylor Connolly, an Agent in Maryland. “Over the last few weeks, we seem to have turned the corner.”

“In Montgomery County, it’s hard to determine if buyers are picky or just being knowledgeable,” reports Nick Chaconas, an Agent in the county. “Our first-time buyers are basically telling the Sellers that their houses are not up to snuff. And I’m telling my sellers that while there’s a blight of inventory, don’t expect full price — it’s just not happening.”

Schizoid Price Trends Create Further Uneasiness

Neither buyers nor sellers appear to be in the driver seat with regard to pricing. While there are some signs of improvement with prices increasing by 4.3% in Fairfax and by 4.8% in Howard, all areas are not experiencing the same changes. Prices continue to decline in Prince George’s County, down by 19.2% from last year as more foreclosures are worked through. There’s still quite a bit of confusion in the marketplace. “Prices seem to be stabilizing,” says Kendell Walker, an Agent in Prince William and Fairfax Counties. “I feel like there are some areas of the county where Sellers and their Listing Agents are trying to creep prices up. For example, when I pull comparables, ‘actives’ are showing slightly higher prices than recent ‘solds.’ And, the good news is that appraisals are coming in higher than the sales price on all types of loans. This time last year, that was not the case. It feels like there has been a turn for the positive in my portion of the market.”

County Median Price* in
February 2011
Median Price Change
since Jan. 2011
Median Price Change
since February 2010
Washington Area
Alexandria $381,285 +3.1% +0.3%
Arlington County $438,268 -3.5% -4.1%
District of Columbia $359,127 -4.3% +8.6%
Fairfax City $380,321 -2.5% -20.6%
Fairfax County $377,527 -0.7% +4.3%
Loudoun County $382,473 +10.1% +2.8%
Montgomery County $313,923 -6.2% -0.6%
Prince George’s County $159,949 -9.5% -19.2%
Prince William County $236,166 -0.5% -3.8%
Baltimore Area
Anne Arundel County $294,235 +1.8% +1.2%
Baltimore City $62,019 -18.6% -21.3%
Baltimore County $205,992 -0.4% -5.0%
Howard County $364,082 +6.1% +4.8%

Change in Median Price of Homes That Sold in February 2011
*Median Price represents a weighted average of the individual median prices for single-family homes, condos, and townhouses. See our spreadsheet for individual breakdowns.

Often it’s more about the Seller and their mindset and level of urgency. Marshall shares his experience on a recent transaction: “The listing agent was ecstatic to hear from me and advised to ‘send in any offer.’ The property had been on the market for over 80 days and the seller had moved out. We crafted a bid substantially lower than we first anticipated, went through a few counters and ultimately arrived at a price that my buyer was very happy with.”

In DC where pricing (up 8.6% from last year) and activity levels are both on the rise, it’s taking a very aggressive buyer to actually land on an accepted offer. Fernando Ferrufino, an Agent in DC, reports that “buyers new to the market are losing out to the more seasoned buyers and are definitely not landing on the first house that they make an offer on. It’s taking a few offers whereby they adjust their strategy to be in the acceptable price range for contract negotiations.”

And in other cases, it’s just the opposite where buyers are waiting out the seller. Nick has experienced it with his representation of both buyers and sellers. “It’s crazy,” says Nick. “Buyers think they have some leverage and will just wait it out. In some cases, they’re right. And in others, their hearts just aren’t into actually winning the house.”

That’s the big picture. Want to know what’s happening in your neighborhood? Download our comprehensive spreadsheet and dig into the data for yourself! Inside you’ll find county, city, and neighborhood information galore. To learn more about how we calculate these numbers, check out our methodology page. You can also liven up the place by posting a comment below.

Best,
Karen Krupsaw
Redfin Washington & Baltimore Metro Market Manager

  • Gheniki

    “The inventory we are seeing is over-priced with over-confident sellers.” -very true. There is a lot of junk out there right now. It appears that the good houses are owned by financially stable owners who are too far under water on their mortgages to be able to move.

  • Guest

    The few good-condition properties that come available are still grossly overpriced by historical income/value ratios… yet as mentioned, buyers are still piling in to bid (and over-bid) on them just because there's so few available. There are really two different markets now, distressed and non-distressed, with completely opposing pricing pressures. The lack of supply of non-distressed properties is actually driving competition and therefore maintaining or increasing prices. Further, inflationary pressures will maintain current values–the Fed's basic strategy seems to be “saving” current homeowners by keeping the burst housing bubble semi-inflated by inflating everything else to match. I predict this “dual market” will continue for many years, with undesireable properties continuing to sink in value and desireable properties basically maintaining current prices–of course, the actual value of those prices will be decreasing in real terms due to inflation. The real question is whether national income will also increase with inflation, but I think we all know the answer to that!

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