Ryan Haley, broker and owner of Atlantic Shores Sotheby’s International Realty, offers some insight on the real estate market in Worcester County, Ocean City, and the national market heading into fall.
The market is vibrant and there are positive signs in the economy, but there are still questions lingering.
When it comes to the local market, particularly Worcester County, we are still seeing lesser inventory compared to buyer demand in September. This means that sales are outpacing opportunities for new listings and inventory. However, this is not as high as the level experienced earlier this summer.
In Ocean City, there are currently 289 Active and Coming Soon properties against 332 Pending and Under Contract listings. In the last six months, which are the COVID months, 984 properties were sold, translating to 164 home sales per month. With the current listings of 289 properties versus the rate of sales of 164 homes a month, we only have a 1.7 months’ supply for Ocean City.
Ocean Pines saw 283 properties sold in the last six months or 47 homes sold per month. It only has 40 properties available now, bringing down inventory to less than a month of supply.
Overall, the market is continuing to improve in terms of demand and inventory, signaling a strong seller’s market.
Real Estate Market Pricing in Ocean City
One of the good things about the Ocean City market is that it has something for everybody when it comes to pricing, from entry-level condominiums to multi-million direct bayfront properties. Relatively, however, Ocean City prices are still more affordable than surrounding communities.
The median sales price is pegged at $275,000 in 2020, higher by 3.8% compared to last year. There were 1,164 properties sold in 2020, up by 15.7% from the 2019 figure, and average days on market is at around 87 days.
This trend of prices increasing is expected to continue for quite some time as demand goes up and inventory stays low. Despite this, it is important to note that prices have still not reached the levels seen from 2004 to 2006.
National Real Estate Market
The national economy is seen to be recovering from the downturn caused by COVID-19, with the GDP expected to grow at an annualized rate of 23.9% in the third quarter, according to the Wall Street Journal.
The economic signs are pointing to a strong recovery in the market. In the real estate market, it is appearing to be a V-shaped recovery where the market hit very low but is recovering very quickly.
The unemployment rate spiked in the month of April which was the peak of the shutdown, but it gradually decreased during the succeeding months, although it hasn’t gone back to the level seen at the beginning of the year. However, economic projections by the Wall Street Journal show unemployment rate decreasing in the coming years and regaining the pre-COVID level after four years.
As for the overall real estate market, experts are projecting prices to go up as inventory goes down across the country.
Maryland is among the states with the biggest change in inventory year-on-year, down 52.2% in inventory compared to the previous year. Neighboring Delaware experienced a decrease of 43.2% in inventory. The decrease in inventory happens as properties are getting sold quickly.
The other factor worth noting is the decrease in monthly mortgage payment due to lower interest rates. This shows that even if prices are going up, properties are still more affordable because of low-interest rates. This scenario is seen to continue to be in play in the immediate future.
For further questions, contact us and we’ll be happy to help.