What an interesting year for Howard County home sales! In defiance of the laws of economics, an increased supply of homes on the market (we’re talking 30-40% increase!) did NOT cause prices to tumble. Au contraire, in fact. Home prices in Howard County are actually UP one percent year to date, while inventory for sale is up 28.3% as of November. How can this be, you ask? We have a few thoughts.
1. Howard County’s unemployment rate of 4.4% (as of September) is the lowest in the state. Our proximity to Baltimore and Washington, DC provides a wealth of opportunity for employment.
2. Howard County’s top notch school system continues to attract buyers, and it’s a chief ingredient in maintaining property values.
3. Low mortgage interest rates have continued through 2014, giving buyers solid purchasing power, and allowing sellers to hold more firm on their sales price.
The question is – will it last?
In the long run, we think interest rates will begin to climb, and it could start as early as 2015. Every one percent increase in the mortgage interest rate DECREASES a buyer’s purchasing power by approximately 10%, reducing the number of buyers who can afford your house.
Maryland’s foreclosure backlog is the fourth highest in the nation, and when these properties hit the market, expect prices to soften in certain areas.
We believe job growth will remain strong in 2015, and that, combined with the entrance of the Millennial (a.k.a. “Generation Y”) buyer, should keep the buyer pool strong.
If you’re a Howard County homeowner thinking of selling, 2015 could be the “perfect storm” to sell in. Before rates rise and foreclosures dominate the news again, while prices have rebounded – this should be a solid market in which to make your move.
As always, the numbers that matter most are yours. Drop us a line for a complimentary market analysis of your home or neighborhood. We’re happy to help!
Laura Kittleman is a partner at The Kittleman Group of Keller Williams Select Realtors, working primarily in Howard County and Montgomery County, Maryland. She can be reached at 301-785-5889 or [email protected].
Tom Yeatts is a partner and Associate Broker with The Kittleman Group of Keller Williams Select Realtors. He can be reached at 443.364.8867 or [email protected].