Regional Spotlight: Maryland Sees 21.1 Percent Drop in Existing-home Sales for Quarter

RISMEDIA, August 20, 2007—(MCT)—Sales of existing homes fell in more than 40 states in the second quarter.

The National Association of Realtors said Wednesday that Maryland was among the top six states with big drops in sales. Existing-home sales were down 21.1% in Maryland in the quarter, compared to a year earlier.

But Terry Fox, president of the Frederick County Association of Realtors, said she sees the market getting stronger locally.

“Sellers are getting close to what they are asking, though they may have to give some closing assistance,” she said.

“Frederick is a unique area. What happens in the rest of the country doesn’t reflect what is happening here,” Fox said. “We still have a strong economy here.”

Nationwide, sales of existing homes totaled 5.91 million units at an annual rate in the second quarter, down 10.8% from the sales pace of the second quarter of 2006.

The national median sales price in the second quarter was $223,800, down 1.5% from a median price in the spring of 2006.

The Maryland Association of Realtors, which combines sales of new and existing homes, reported an 18.3% drop in sales in July, compared to July 2006.

In Frederick County, July home sales were down 20.9%. The average price for a home in the county in July was $366,884, down from $369,503 in July 2006.

There are more than 2,400 homes listed on the market in Frederick County, about twice the normal market.

Montgomery County has more than 6,000 homes actively listed for sale with an average price of a home sold in July at $601,995, up nearly 10% from a year earlier.

“The costs of construction trends up from one year to the next, so even in areas that experience price declines, owners who maintain their property generally retain most of the equity that has built up in their homes over time,” said Pat V. Combs, president of the national Realtors’ group.

Asked if she had heard of frustration by potential home buyers facing tougher lending regulations, Fox said she had not run into that so far.

She said a few lenders are removing some mortgage products.

Loans to subprime borrowers, which have turned into foreclosures and other financial problems, have been a major issue for economists.

Fox said previously that one of the problems is that borrowers don’t always understand the consequences of adjustable mortgages and other loans. Federal regulators have called for tighter loan regulations and more consumer education on mortgages.

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