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It has been said throughout the years that Baltimore’s real estate has been a strong, even “recession-proof” market, despite what may be going on across the nation. Maryland has several factors, outside of just being in close proximity to the Nation’s capital, contributing to this perspective. To name a few:    

The state’s limitation on new construction keeps the market values high; Consistent job growth; Low unemployment percentages year after year; High-paying employment opportunities when compared to national averages.

From the Office of the Lt. Governor of the State of Maryland, Anthony G. Brown:

“Maryland is the wealthiest state in the nation, the best-educated state in the nation and is home to the most diverse workforce in America.  15 % of Marylanders have earned an advanced degree.  53 % of Marylanders have earned at least a bachelor’s degree  26 % of Maryland’s workforce is employed in the professional or technical economy  31 % of Maryland businesses are majority owned by women  16 % of Maryland businesses are majority owned by African Americans”

Even in the midst of the record foreclosures and falling home sales in 2007 and 2008 as reported and sensationalized by the media, Baltimore remains consistently stronger than the majority of the nation.  Many areas throughout the US are experiencing unprecedented rates of foreclosure—TRUE!  High foreclosure rates ultimately negatively affect the local economy for many reasons, not just decreasing market values—TRUE!


 What’s going on in other markets is probably what’s going on in Baltimore—

FALSE!!!

Foreclosure

http://www.mdrealestateblog.com/ by riarossi on Thu 01 Nov 2007 02:31 PM EDT

According to mortgage data company RealtyTrac, there were 635,159 mortgage foreclosure filings in the last quarter alone. Significantly up from last year. This figure accounts for one foreclosure for every 196 households in the country. Digging a little deeper into the numbers we see that 44% of the filings came from just three states; California, Florida and Ohio. Nevada also had a rate of foreclosure of one in every 61 households. The Annapolis MD real estate area has their share of foreclosures but nothing approaching these rates.

Thursday, November 13, 2008

Baltimore Business Journal

Foreclosures in Maryland surge 32 percent One of every 774 households in Maryland was in foreclosure in October, according to an industry report released Thursday. Maryland foreclosures jumped 32 percent between September and October to 2,973, according to Irvine, Calif.-based RealtyTrac Inc. Maryland posted a year-over-year percentage decrease, however, down 16 percent. Of Maryland, Virginia and Washington, D.C., it was the only jurisdiction to post a decrease compared with the same period a year ago. One of every 1,246 households in D.C. were in default in October. D.C.’s foreclosures were up 177 percent year over year. RealtyTrac cautioned that incomplete data from the year before may distort year-ago comparisons in the District. Virginia had the highest foreclosure rate in the region, with one of every 493 households in default. Virginia’s monthly increase in foreclosures in October was modest, up just 2.5 percent to 6,555. The Washington area as a whole fared better than the nation on a per-household basis. One of every 452 households were in default nationwide in October. Nationally, foreclosures rose 5 percent from September and 25 percent from October 2007 to 279,561.


Nevada had the highest foreclosure rate with one out of every 74 households in default. California had the highest number of foreclosures with 56,954, even as its foreclosure activity decreased. California foreclosures peaked in August at more than 100,000. Baltimore’s economy has consistently reflected that of the NorthEast sector even though sometimes Maryland is considered to be part of the South. Even taking an average between the NorthEast and South regions, the numbers still are stronger than the rest of the nation. National Trends Average (Mean) Sales Price of Existing Homes by Region U.S. Northeast Midwest South West $269,500 $306,000 $202,600 $230,800 $378,100 266,200 313,300 196,100 225,900 372,500 242,100 301,200 178,100 212,800 316,600

Date 2006 2007 2008

2008 vs. 2007 2008 vs. 2006 Oct-08 Nov-08 Dec-08

-3.862 % -1.569 %

-9.179 % -12.093 %

-5.799 % -7.779 %

-15.007 % -16.266 %

229,300 277,700 170,000 203,100 301,200 222,800 292,100 163,000 192,400 288,200 215,300 269,900 163,300 200,600 256,800 Statistics from the National Association of REALTORSÂŽ

January 12, 2009

Baltimore-area home prices fell 3% in 2008 Year's decline in average price was the first in at least a decade By Lorraine Mirabella and Jamie Smith Hopkins Real estate agent Rob Preston stands on the lawn of a Lutherville home he is trying to sell for owners who have moved. Its price has been cut three times. (Baltimore Sun photo by Glenn Fawcett / January 8, 2009) Baltimore-area home prices declined for the first time in at least a decade last year, preliminary figures released this weekend show, as the region's housing market feels the sting from the worsening recession.

Sales statistics released by the area's real estate listing service indicate the average home price dropped 3 percent last year to $306,500 in Baltimore and its five surrounding counties compared with 2007. The figure was less than the average in 2006 as well.


Sales on an annual basis slumped 28 percent, with 21,500 homes changing hands. That's the lowest number since Rockville-based Metropolitan Regional Information Systems began tracking local sales in 1998. Twice as many homes sold in 2005, the height of the national buying spree that many now blame for the nation's economic trouble.

The 2008 figures - calculated by The Baltimore Sun from MRIS numbers - are preliminary and could change. MRIS released December sales late Saturday but will not announce an official 2008 tally until next month. Housing activity continued to slow last month with sales slumping nearly 17 percent and home values declining almost 6 percent compared with December 2007, MRIS reported. While many real estate professionals hope that declining mortgage rates will help bolster sales and prices during the coming months, some economists predict the housing market still faces weaknesses as employers cut jobs and jittery homeowners pull back on spending. "I don't think you will see any breaks from any of the negative trends that have been established in recent months," said Anirban Basu, chief executive officer of economic consultants Sage Policy Group in Baltimore. "There had been subtle signs of recovering for much of 2008, but that momentum was crushed by events of September last year and tightening of credit."

He said a recovery is not likely to occur until home prices begin to stabilize. In November, house prices had fallen to the lowest level in more than three years. In December, the most recent monthly report shows, the average sales price fell 5.9 percent, to $294,954. Only 1,482 homes changed hands for the month, compared with the 1,779 homes sold in December 2007, MRIS said. Prices fell in all jurisdictions, from just barely in Carroll, a 0.26 percent decline, to an almost 10 percent drop in value in Howard. For the year, sales declined by at least 24 percent in every jurisdiction, falling the most in the city, according to the preliminary figures. About 5,100 homes were sold in Baltimore - a 34 percent decline compared with the year before. Average prices in the city, however, were flat last year at $187,000. Carroll County posted the largest average price decline last year as buyers spent $323,500 for homes - an 11 percent fall from 2007. "Once buyers feel prices are set to rise, you will have the requisite level of urgency that will drive the market ahead, but for now, there's not much reason for buyers to act with urgency," Basu said. "The presumption is prices will continue to fall and as a result the optimal strategy is to wait."

With inventory high - more than 18,000 homes were on the market in December sellers are finding they have to present a house in move-in condition to attract buyers. Or, they need to price a home that requires upgrades below market, agents said. On the flip side, the buyers who want to make a move can't always get financing. "Buyers right now are so scared about the depreciating market," said Rob Preston, an agent with Long & Foster in Timonium. "It's one thing to buy a house in move-in condition, but it's harder to sell when people are not only worried about an asset continuing to depreciate but have to put in money to get it up to their standards after they purchase." Homes stayed on the market, on average, almost five months before going under contract, nearly 23 percent longer than in December 2007, the MRIS statistic show. And sellers got, on average, about 89 percent of their asking price.

Recent drops in mortgage rates combined with moves to make financing more readily available to buyers could start to bring buyers back into the market, the head of a local Realtors board said.


"The pent-up demand we feel exists in Baltimore is going to be satisfied by the bottoming-out of prices," said Vito Simone, president of the Greater Baltimore Board of Realtors. "Certain price points are not selling, but price points that are affordable are, in fact, selling," such as the $200,000-to-$250,000 range. A glimmer of hope for recovery is coming from first-time buyers, who are still active in the market, and from the interest in showings for homes priced between $300,000 and $400,000, agents said. "There is some pent-up demand," Preston said. "You can feel that in the amount of people coming through [open houses]." He said he senses that many would be ready to make a move if they felt more confident, not only about their investment but about their job outlook. The U.S. unemployment rate rose to 7.2 percent in December and brought the total jobs lost for the year to the largest number since 1945, the Labor Department reported Friday. A staggering number of jobs have been lost in the past four months alone - 75 percent of the 2.6 million jobs lost in all of 2008, the government said. With joblessness on the rise, Preston said, potential buyers "just need to know the rug isn't going to be pulled out from under them."

Without a doubt, Baltimore being “Recession-Proof� is DEFINITELY being put to the test! But check out these articles written long before our current national economic crises and not long after BRAC was put into plan (more on BRAC in just a moment):

Sun Special Report: The Coming Housing Crunch

A 2006 special report looks a projected population surge in the Baltimore area and examines its impact on housing, traffic and the regional economy. July 23, 2006 The coming housing crunch http://www.baltimoresun.com/news/local/brac/bal-shortage0723,0,1913247.story The Baltimore metropolitan area stands ready to add more than 200,000 jobs over the next 25 years, propelled by the huge economic engine of the nation's capital and the growing demands of talent-hungry employers. But it won't have enough homes for all those workers.

July 24, 2006 Searching for solutions http://www.baltimoresun.com/news/local/brac/bal-shortage0724,0,1978784.story Travel to a run-down stretch of Ritchie Highway for one answer to the Baltimore region's looming housing shortage. The long-boarded-up shops of Southview Shopping Center in Anne Arundel County are set to give way to homes starting at more than $300,000.

July 25, 2006 Gap gives city its chance http://www.baltimoresun.com/news/local/brac/bal-shortage0725,0,2044321.story


Developer Patrick Turner has big plans for nearly 40 acres in Baltimore's struggling Westport neighborhood. Big as in more than 5 million square feet of waterfront offices, retail, entertainment and urban living. Big as in 1,800 homes, twice what Westport has now.

July 23, 2007 Homeowners driven to extreme http://www.baltimoresun.com/news/local/brac/bal-2shortage0723,0,2968718.story Kim Dansker works in Annapolis. Her children's day care is in Severn. Until recently, she lived in Pasadena -- everything neatly in Anne Arundel County.

September 18, 2007 About the analysis http://www.baltimoresun.com/news/local/brac/balshortageside0723,0,2327306.story The Sun's housing analysis uses the Maryland Department of Planning's most recent growth forecasts to calculate how many new dwellings would be needed to keep pace with job growth in the region - Baltimore and its five suburban counties. As the series describes, jobs are expected to be created in numbers far greater than there is housing to accommodate workers. Not enough new homes are being built, and more homes will be taken up by retirees as the vast baby boom generation leaves the work force.

So now‌

Let’s Talk About B.R.A.C.


Fort Meade, MD The base realignment is expected to bring 10,679 people to the base which is located on 8,000 acres in Anne Arundel County. Less than 10 percent of the incoming personnel are military. The Department of Defense will relocate its media services, the Defense Information Systems Agency and the Adjudication and Office of Hearing and Appeals Offices to Fort Meade. About 4,300 workers from DISA are moving from Northern Virginia to Ft. Meade

Aberdeen Proving Ground Located on nearly 72,000 acres of land in Harford County, APG is a center for Army material testing, laboratory research and military training. BRAC is expected to bring 14,159 jobs to APG, including thousands of scientific and engineering jobs, many of which will come from the relocation of two major electronic communications operations from Fort Monmouth, NJ. APG will go from $3.5 billion in annual research and development activity to $10 billion annually. A smaller number of jobs, related to the base’s Ordnance School and other facilities, are moving out.

For the full article, go to: http://www.mdbusiness.state.md.us/pressroom/pressreleases/braczones.html


Lt. Governor Brown announces significant BRAC Progress ANNAPOLIS, MD (December 15, 2008) – At a news conference in Annapolis today, Lt. Governor Anthony G. Brown announced significant progress in the state’s efforts to prepare for the job and population growth expected to come to Maryland due to Base Realignment and Closure. Brown, the Chair of the Governor’s Subcabinet on BRAC, designated five areas as BRAC Zones and awarded 16 grants to colleges and universities through the BRAC Higher Education Investment Fund. Today’s announcement comes approximately one year after Lt. Governor Brown and the BRAC Subcabinet submitted the BRAC Action Plan to Governor Martin O’Malley. “A year ago, we presented a playbook for BRAC to Governor O’Malley. Today, as we look back on a year’s work, we can say with great confidence that we have made incredible progress – progress that will continue into the New Year,” Lt. Governor Brown said. “By working across county lines and partisan labels, Maryland will be ready for BRAC. We know the challenges we face, and we are working past them by helping local government prepare the sustainable infrastructure and by giving our colleges and universities the support they need to build a BRAC-ready workforce.” The authorization to designate BRAC Zones was established with the Governor O’Malley’s signing of the BRAC Community Enhancement Act earlier this year. All

five applications that were received were accepted: the Westport Waterfront development in Baltimore City, an area near MARC Odenton Station in Anne Arundel County, an area near Andrews Air Force Base at the Branch Avenue Metro Station in Prince George’s County, an area in historic Frederick and near the Frederick Transit Center, and an area in the City of Laurel along Route 1 and near the Laurel MARC Station. Baltimore City’s BRAC Zone includes the Westport Waterfront development and the Westport MD295 Ramp improvements. The 42.9acre Westport Waterfront project will comprise two million square feet of office space, 300,000 square feet of retail space, 2,000 residential units, and 500 hotel rooms. Construction of the first building pad is expected to begin in 2009. Anne Arundel County’s BRAC Zone encompasses 776.9 acres near the MARC Odenton Station and along MD-175. The most notable projects at the site include the transit-oriented, mixed-use developments at Village at Odenton and Odenton Town Center.


The BRAC Zone in the City of Laurel is a 293-acre area that includes redevelopment of Laurel Commons Town Center, Hawthorne Place, a section of Route 1 and the city’s Main Street area near the MARC Station. The Laurel Commons Town Center project includes plans for a $200 million private investment for the redevelopment of Laurel Mall. Lt. Governor Brown and the BRAC Subcabinet will release the 2008 BRAC Progress Report next week. The Progress Report will provide matrices and documentation based on the action items detailed in the BRAC Action Plan that was presented to Governor O’Malley last December.


Fort Meade, MD The base realignment is expected to bring 10,679 people to the base which is located on 8,000 acres in Anne Arundel County. Less than 10 percent of the incoming personnel are military. The Department of Defense will relocate its media services, the Defense Information Systems Agency and the Adjudication and Office of Hearing and Appeals Offices to Fort Meade. About 4,300 workers from DISA are moving from Northern Virginia to Ft. Meade

Aberdeen Proving Ground Located on nearly 72,000 acres of land in Harford County, APG is a center for Army material testing, laboratory research and military training. BRAC is expected to bring 14,159 jobs to APG, including thousands of scientific and engineering jobs, many of which will come from the relocation of two major electronic communications operations from Fort Monmouth, NJ. APG will go from $3.5 billion in annual research and development activity to $10 billion annually. A smaller number of jobs, related to the base’s Ordnance School and other facilities, are moving out.


For more detailed & current information on the Baltimore Real Estate Market Please visit our: BuyBaltimoreProperties.com BLOG WEBSITE

THE FUTURE OF BALTIMORE REAL ESTATE!  

This is a compilation of recent news highlighting the future for the Baltimore Real Estate Market.

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