The real estate market looks positioned for a good year according to an overview put together by Coldwell Banker Chesapeake Real Estate.
They just released their “Eastern Shore Real Estate market 2014 Year End Numbers” with a forecast for a climb back to normal to continue through 2015.
“We’re bullish on both Kent and Talbot markets for 2015, ” says Hugh Smith, broker/owner of Coldwell Banker Chesapeake. “If you look at economic indicators in the national economy like lower unemployment, we’re seeing this as a tipping point for an upswing in Kent and Talbot sales. Even a stock market correction can be a good thing as people start to look for different kinds of investments and the possibility of an interest rate increase will probably knock some people off the fence from watching to buying,” he added.
The study and projection include Caroline, Dorchester, Talbot, Queen Anne’s, Kent and Cecil Counties:
Sold Dollar Volume: Sellers on the Upper Eastern Shore closed $890,448,394 in real estate sales in 2014 – down 42% from the peak of the last boom market in 2005. This represents only a marginal improvement year-over-year and but a 45% improvement over the bottom of the market which was achieved in 2011. Every year since 2011 has shown a slow but steady improvement in this metric. Look for this trend to slowly accelerate in 2015 and thereafter as national economic fundamentals and consumer confidence continue to improve and waterfront buyers return to the shores of Chesapeake Bay.
Average Sold Price: The average sold price of an Eastern Shore residential property was $282,772 in 2014 – down from a high of $383,488 achieved in 2007 and down marginally year-over-year. The average sold price continues to suffer for the continued absence of luxury and waterfront buyers from the eastern shore markets. Look for this number to improve as the tax climate for high net-worth buyers improves with the new administration in Annapolis.
Median Sold Price – The median sold price of $210,000 continues to hover near the bottom of its 10-yr range. This reflects the continued high number of foreclosures and short sales in the market and the previously mentioned absence of luxury buyers. The median Sold Price will improve in 2015 and thereafter as the inventory of foreclosures declines and luxury buyers return to the market.
Units Sold – The absorption rate of Eastern Shore real estate was still off its 2005 highs (when 4,411 units were sold) but at 3,149 units it is a vast improvement over the low of 2,050 units posted in 2008. Look for this trend to continue as gas prices continue to fall in 2015 and the Washington/Baltimore metroplex becomes more congested and expensive for first-time and first move-up buyers.
Average Days On Market – The average of 160 Days on Market (DOM) for all sold listings is a significant improvement over the high of 203 experienced in 2011. Look for this trend to continue in 2015 as value conscious buyers recognize the good values to be found in most Eastern Shore markets. A rising interest-rate environment will also prompt buyers to jump of the fence in 2015.
Average List Price For Solds – The average list price for solds at $302,572 is just off its bottom of 299,425 experienced in 2011. This metric has experienced considerable downwards pressure from short sellers and sellers will continue to make significant concessions to achieve timely sales for lifestyle reasons. Look for this trend to continue through 2015 as excess and shadow inventory continues to be absorbed.
The real estate markets of the Eastern Shore are slowly returning to normal market conditions and should continue to improve in 2015 along with consumer confidence and national economic conditions. There is no reason to believe that we will return to the bubble conditions of 2005 anytime soon nor is there any reason to anticipate another bust like 2008-2011. Sellers who position their asking prices well relative to the market should anticipate selling in a reasonable period of time. Buyers who jump in in 2015 should find excellent choice and good values. Buyers who wait until late in 2015 or beyond, risk missing the most pronounced Buyers’ market conditions in a generation.