The first-quarter Metrostudy data for the Baltimore area housing markets shows a shaky start to 2014. As the number of new-home closings has fallen, so has the median closing price and cost per square foot.
The number of overall closings in the Baltimore market decreased from 7,710 to 7,642 year-over-year from 1Q13 and 1Q14 and from 9,568 in the fourth-quarter of 2013, a 20 percent decrease. The closing price median for homes in the past year peaked at $151 in the 1Q13, but has since decreased slightly to $142 in the first-quarter. This is, however, still a year-over-year increase from the first-quarter of 2013 from $138. The overall median also fell during the first-quarter compared to the previous two. The median price reached more than $250,000 in the last three quarters, but fell to $235,000 in the first-quarter. Once again, this is a year-over-year increase from 1Q13 when the median closing price for homes overall was $227,500, marking a 3.3 percent increase. New-home closings also fell in the market from 763 to 673 between 1Q13 and 1Q14, an 11.8 percent decrease. There was also a decrease in new-home closings in the first-quarter versus each of the previous three in 2013. Despite this decline, the median closing price for new-homes is still on the rise up to $431,300 in the first-quarter and $194 per square foot median price. The median new-home closing price in 1Q144 was $377,900, which is a 14 percent increase in new-home prices year-over-year. Although the median closing price overall is still well below $300,000 in the Baltimore market, this still prices the entry-level buyer out of the struggling new home market.
Vacant Developed Lot inventory and housing supply in the Baltimore market has been stable for the past year. The market had a VDL inventory of 5,410 in the first-quarter, down from 5,476 in the previous quarter and up from 5,175 in 1Q13. Finished vacant inventory had a slight decline in the first-quarter to 587 from 633 in the fourth-quarter and 734 in 1Q13, a twenty percent year-over-year decrease. Months supply of housing in the market hit 7.2 months in the first-quarter down from 8.5 months the year before.
Some of the unpredictability in the market might be thanks to a six percent unemployment rate in May, about the same as the national average. Significant price appreciation for new homes might prevent those renting in the Baltimore and DC from becoming a first-home buyer. As the Housing Market Index has begun moving up in the summer months, however, homebuying in the Baltimore market might rebound as well.
Learn more about markets featured in this article: Baltimore, MD.