Table of Contents
- Frederick County Real Estate Market Update
- Real Estate Market Trends in May in Frederick Md
- Detailed Market Statistics for Frederick County
- About the effects of the Corona Virus on the real estate market:
- Maryland Law Regarding Real Estate Sales
- Frederick is a Bifurcated Real Estate Market
- What’s Notable for Buyers:
- Luxury Homes in Frederick County:
- What’s Notable for Frederick Sellers:
- *Recent Maryland Real Estate Statistics
Frederick County Real Estate Market Update
Provided by Chris Highland ~ May 2020
May was the first month that told the Covid 19 real estate story. Sales were relatively healthy, but significantly down from this time last year. Interestingly enough, time on market was significantly down, and prices continued to rise at a healthy pace.
We’re just getting a glimpse of what is happening in the real estate market. Let’s dig in…
Total volume in sales in May was down 17% over last May
As a brokerage with agents all over the state, we saw low inventory throughout Maryland, but that is nothing new. The overall number of homes on the market has remained low for several months. *See Maryland market statistics below.
Here is a snapshot of Frederick County’s real estate market trends for May 2020, and a projection of what we can look forward to in the next two months…anything after that is anyone’s guess.
Real Estate Market Trends in May in Frederick Md
Up, Up and …um…not so sure…
The Median Home Sales Price: $345,000, up 11% from last May. We’ve seen a larger decrease in townhouse sales as compared to single-family sales, but an increase in the sales prices of both.
- Average Single-Family Sales Price: $411,000, up 1% from last year at this time.
- 227 single-family homes sold, down 17% from last year’s number.
- Average Attached Home Sales Price: $381,300, up 8% from last year.
- 123 townhouses and condos sold, down 32% from last year’s number.
- A total of 354 homes sold, down 22% from last year!
Even though the demand was down over last year, most likely due to the effects of the Covid-19 virus, there was still a healthy demand combined with a very low inventory…less than 700 homes on the market.
Healthy demand and a low inventory = price acceleration.
698 homes were on the market (the lowest for May in 5 years) inventory was down 38% from last year. Keep in mind that a “normal” inventory is between 1300 and 1400 homes on the market. It is very much a seller’s market. New listings have slowed quite a bit this month when this is usually the time of year when the inventory increases. The effects of the quarantine are being realized.
**As of today, June 14, there are currently 704 homes listed for sale in Frederick County. The breakdown is 418 existing homes and 286 new construction homes.
As Maryland businesses are beginning to open back up, we look forward to seeing how this affects the real estate market.
Detailed Market Statistics for Frederick County
Average Days on Market (DOM) the time it takes to get a home under contract: 30 days, down 21% from last year at this time (38 days). .. less than the 5 years March average of 39 days, in fact the lowest in 5 years. Tight inventory, homes selling fast!
Title companies and lenders have been doing a stellar job of moving quickly and providing safe alternatives to the usual lending and settlement procedures. Great job partners!
New Listings in May: There were 605 new listings last month, a 20% decrease over May 2019.
There are 916 homes under contract, making their way to closing, up 17%. This is an important statistic! It tells me that the Covid-19 effect is more than likely a blip on the radar. I’m betting it will be business as usual when things open up again.
Add to that:
Number of Homes Under Contract: There were 553 new contracts (homes that went under contract) 3% more than last year. These are good signs for a robust summer market!
When more homes are selling than are coming on the market, this is a sign of higher demand.
Which brings us back to a homeowner’s favorite formula:
Increased demand and a low inventory = price acceleration.
About the effects of the Corona Virus on the real estate market:
Regardless of the current health scare, people still have reasons to sell their homes and to buy a home…they get a new job, they need more space, they’re moving out of the area. Life goes on.
If you are in the market right now, the National Association of Realtors® has published articles that give great advice to home buyers and home sellers during this time. Please practice reasonable and common sense precautions:
Buyers touring a home:
- It may go without saying, but if anyone in your family is not feeling well, do not go to see homes.
- Drive your own car to showings.
- As you tour a home, don’t touch things you don’t have to. This means pretty much anything except door handles.
- Wear booties if they are not provided at the home.
- Many health advisory websites encourage wearing gloves. Not surgical gloves, just gloves. Take them off when you get home and wash them. It’s a simple measure that makes a lot of sense.
- Use hand sanitizer after you leave a home.
- Keep a six-foot distance from others, including your Realtor®. We won’t take it personally!
- If a family member is not feeling well, do not have showings.
- Provide hand sanitizer at your entry.
- Even though we’re being encouraged to stay home as much as possible, it is still a good idea to be absent when your home is being shown. This gives buyers the freedom to look and discuss the home with each other and their agent.
- To continue practicing social distancing, simply drive to a nearby park, or pick up something you need from a drive-through. The current weather is even amenable to hanging out in your backyard, or taking a walk through your neighborhood.
- Leave cabinets, doors, or anything you want buyers to see open, so they don’t need to touch the knobs or doors.
- Have all lights on and blinds and curtains open.
- Wipe down all surfaces with a bleach or alcohol cleaner before your home is to be shown. Then again after the showing is over.
- Wipe down door handles…before and after the showing.
- Keep fabric booties at the front door for buyers to wear. This is a good idea any time. Have a box or basket of clean booties, and a box or basket for dirty ones. Then you can simply dispose of the dirty ones.
Reasonable and healthy steps will protect you and your family whether you are a buyer or a seller. **Please consult the CDC Website: Coronavirus Disease 2019 for advice and the latest information.
Maryland Law Regarding Real Estate Sales
Real Estate is considered an essential business in Maryland. But it is still a tricky field to navigate. Our state association, Maryland Realtors®, has developed a set of guidelines, which have been reviewed by the Hogan Administration. These are guidelines and are continually monitored and updated.
Accordingly, real estate licensees will limit personal interactions to the greatest extent possible and will engage in-person only when necessary, and follow these strict protocols:
In-person activities must be by appointment only.
No more than three (3) people, including the agent, may be at a property at any one time.
Those three persons must strictly follow physical distancing guidelines established by the Centers for Disease Control and Prevention (“CDC”) by remaining at least six feet apart at all times.
Real estate licensees who strictly follow the above protocols are permitted to engage in the following in-person activities related to the purchase and sale of homes:
Conduct listing presentations, take property photos and create virtual tours for new listings.
Facilitate the signing of contract documents.
Preview and show listings by appointment only.
Facilitate photography/videography, inspections, appraisals, buyer “walk-throughs,” and key delivery.
All other real estate brokerage services will be limited to services we can provide remotely. There are risks associated with leaving the safety of your home and viewing homes for sale, as well as having prospective buyers enter the seller’s home. Buyers and sellers must be attentive to and abide by the mandates and guidelines from public health officials and work with their real estate agents to make informed decisions about listing, selling, and purchasing real property. REALTORS® will exercise their best judgment under the circumstances to provide advice regarding all aspects of the current real estate market.
Updated information about COVID-19 is available from the Centers for Disease Control and Prevention and from the Maryland Department of Health’s COVID-19 Information Portal. If you have specific questions about health concerns related to COVID-19, you should consult with a health professional.
For the latest information and updates, please visit the Maryland REALTORS website.
Frederick is a Bifurcated Real Estate Market
Sellers got 98.6% of the original list price on average, compared to 98.2% at this time last year. Appraisers are saying we’re seeing 3-5% increases in values, depending on price range. Lower price ranges (average $300,000) are appreciating more than the upper price ranges ($600,000+).
Keep in mind:
- In some price ranges, in some areas of Frederick County, there is naturally a higher demand and the market is more competitive for buyers. Some neighborhoods, like Urbana, Middletown, New Market, Mt. Airy, and a few neighborhoods in the city of Frederick, are in high demand and sell much quicker. We are seeing multiple offers on homes that are in great condition and priced to sell.
- Homes in the $300,000 range, are in demand and have seen a 4% – 6% increase in value over the year. Less appreciation, 2% on average, for homes in the highest price ranges. But the good news is that homes above $600,000 have been selling again…in some areas. There is a 12-month absorption rate for homes in the upper price ranges, compared to a 1- to 2-month absorption rate for homes in the lower price ranges.
In any market, but especially in a seller’s market, buyers must be prepared before they find a home. You must be pre-approved by a reputable local lender. Most sellers will not entertain offers from a buyer who has not been pre-approved.
If you have a house to sell, you need to get it on the market first, before you make an offer. Better yet, have your home under contract if you want to win in a multiple offer situation. Some people even find that having their home sold and having a temporary living set up gives them the greatest advantage if they are buying in a highly competitive price range.
What’s Notable for Buyers:
- The majority of homes sold were in the $300,000 to $399,000 range. (higher competition for buyers) The largest number of listings are also in the $400,000 to 499,000 price range (higher competition for sellers)
- Mortgage rates eased back have stabilized at record lows. But many lenders think they could fall lower.
- As the economy reacts to the steps taken to “flatten the curve” of the Corona virus, the Fed has lowered the interest rate to zero, and will buy at least $700 billion in government and mortgage-related bonds. This will certainly mean rates will stay low for a while. It may be a good time to refinance.
Luxury Homes in Frederick County:
Believe it or not, where the bargains are…
- The number of luxury buyers in Frederick County is like a sliver, compared to other price ranges. But, they are there, albeit in fewer numbers, looking for their dream home.
- There are 114 homes listed above $600,000, with 22 that sold in May in that price range. (19% of the luxury inventory sold last month, while 51% of the overall inventory sold last month)
- 0 home sold between $800,000 and 1 million.
- 1 homes sold between 1 and 2.5 million.
- The average time on the market for the luxury homes was 59 days, (compared to 95 days in April) The average sold price to original list price was 98.1% (compared to 96.6% in April.)
What’s Notable for Frederick Sellers:
- We had a robust early spring market. All indications are that the there are still people wanting to buy, waiting for the Covid-19 scare to ease…with an inventory that is very low, prices are still on the rise.
The question is about buyers…how much demand is there as we wait out this current situation? Time will tell.
*Recent Maryland Real Estate Statistics
Across Maryland, everything was up, up, up, in April except for the time on market. We’re still waiting on May market statistics to be published. We will post them here.
According to Harrison, Realtors in Maryland are adjusting to the current market and endeavoring to transact business in a safe and responsible manner because of the COVID-19 pandemic. “Although we can’t predict the scope or duration of this situation, we can do our part to bolster the local economy by providing essential housing services to those in need and doing so in a way that honors Governor Hogan’s ‘Stay-at-Home’ order issued late March,” said Harrison. “While many of our members weathered the 2008 housing crisis, this situation is very different. Back then, housing was not on solid footing. Today, the industry as a whole is in a better position to rebound.”
May 2020 Market Statistics provided by Bright/MRIS (Mid-Atlantic Regional Information System – A Bright MLS)
These statistics are not guaranteed but are considered accurate.
Contact Chris Highland to see homes for sale in Frederick Md. We are here to help you navigate through this currently challenging market.