Frederick Md Real Estate Trends July 2016
provided by the Highland Group
July 2016 Snapshot:
The number of homes that sold in July was slightly higher this time last year: 394 homes sold, 1% higher.
The number of homes that went under contract was significantly up, 24% over last July.The Summer market in 2016 is continuing in a healthy number of sales.
Here’s a breakdown of sales by home type:
Of the 394 homes that sold in Jule, single-family home sales were up ↑ 6%, townhouse and condominium homes were down ↓ 7% across Frederick County. Sellers on average, got 97% of listing price across the board, compared to 96% at this time last year. This has been a consistent number for the last year.
The inventory of homes for sale in Frederick County has been that of a normal, balanced market. There are 1200 homes on the market this July, compared to 1399 last year. Down 14%, in a market where there is even more demand than last year.
Time to Sell is Decreasing
The average time it took to sell home in Frederick County was 56 days in July, down from 66 this time last year. This 15% decrease is a sign that demand is still up throughout the summer.
Summer Supply and Demand
The real estate market in Frederick County, like the summer weather, is hot. Home sales increased significantly at the beginning of the spring market, starting in March, just like the two prior years, but unlike the two previous summers, sales didn’t ease up. Real estate sales have remained robust all through the summer months. As of mid-summer, we’ve already seen a 14% increase in home sales in 2016.
While demand is high, the supply is good as well, causing a balanced market. As the median home sale price has risen just over 3% overall this year, we can expect that home values are on a healthy increase as well.
That comes with a caveat, though: “For homes valued under $400,000, we’re seeing a 4% increase in values,” says Wayne Six, with Six & Associates, appraisers in Frederick County. “As for homes above $500,000, although we can’t safely say there is appreciation, we can say they are starting to move again. The engine’s running, and that’s good.”
Interest Rates At Historic LOWS
We have seen mortgage interest rates reach new historic LOWS this summer. Thanks in part to Brexit, rates have bounced around in the mid-3% ranges, unheard of since rates have been tracked. And how does that affect the market?
Due to historically low rates, we’re seeing a continual stream of buyers enter the market. “We’re doing our best to educate buyers, especially Millennial home buyers, on how low these rates really are,” says Robert Drake, Branch Manager of Integrity Home Mortgage in Frederick. “We haven’t seen rates this low in 60 years…and then, our grandparents were paying 4%, which is still higher than today’s 3.4% rates. People need to understand that their buying power is the highest it will probably ever be.”
What About the Future of Interest Rates?
We’ve been hearing for months that the Fed is going to raise the benchmark interest rates, that we should be ready for higher mortgage rates. But it hasn’t happened. What can we expect for the near future? Most experts agree that there are two reasons why rates are not and probably won’t be going up for the remainder of 2016:
Brexit and the Presidential election.
Typically, an election year adds an element of unpredictability to markets, which tends to keep rates from changing. Many mortgage experts are predicting that even if the Fed raises rates, that most likely won’t raise mortgage rates. Rates will remain low until the international market becomes stable.
What Can Frederick County Buyers and Sellers Expect in the Near Future?
Without that crystal ball to guide us, most real estate professionals are still very positive about the real estate market throughout the rest of this year. Buyers should be confident that they will find a home to fit their wishes.
Sellers should know that this is a good time to sell, especially if they have been waiting several years for their home values to return. It is, however, a balanced market, so they should not expect to see values rise more than a healthy 3% to 4%. It’s always advisable consult a REALTOR® to determine a market value range before you decide if the time is right for you to sell.
Contact Chris Highland for information on the real estate market in your Frederick neighborhood. 301-401-5119 or