February Home Sales Decline in Wicomico, Prices Steady

Salisbury MD Real Estate Sales Report for February 2023   February 2023 Salisbury MD Home Sales Statistics In February 2023, the median single-family home sales price in the Salisbury MD area real estate market was $242,500. This was down 2% from the median sales price last February. There were 71 home sales, down 19% from the same month last year. The average time on market was 2.4 months, up from 1.6 months in February 2022. Currently, there are 2.0 months of supply of homes in Wicomico County.* This is determined by how many homes are available divided by how many homes sold the previous month.   Conclusions for Wicomico County Home Buyers After a third consecutive month of stable home prices in Wicomico County, buyers can take some comfort that double-digit gains are in the rearview mirror. However, troubling economic reports regarding inflation has the Fed set to increase interest rates possibly three more times this year. This would be reflected by increasing mortgage rates which are once again pushing the 7% mark. When coupled with extremely low home inventory in the Salisbury MD area real estate market and prices at historic highs, it makes for a very challenging scenario for today’s homebuyer.   Conclusions for Home Sellers in Wicomico County Wicomico County homeowners planning to move in the next few months can expect a sellers’ market with little competition from their neighbors. High home prices and spiking mortgage rates will certainly mean fewer buyers but that also means fewer would-be sellers will not be trading a sub-3 % mortgage for one at twice the rate unless they absolutely must. This in effect will mean the supply/demand dynamic we’ve seen for the last several years will not change appreciably any time soon. We went more in-depth on the housing supply crunch in the Q3 of 2022 Housing Report.   March 2023 Salisbury MD Real Estate Outlook After underestimating the February home sales totals, we’re projecting around 65-70 homes will close in the Salisbury MD area to close out Q1. If this proves correct, it will be on par with March home sales from 2012-2014 but at significantly higher prices. *Based on information from the Coastal Association of Realtors® for the period 2/1/23 through 2/28/23 Information compiled by Vision Realty Group is deemed to be reliable but is not guaranteed. © BRIGHT MLS Copyright 2023

Wicomico Home Sales Decline in January, Prices Stabilize

Salisbury MD Real Estate Sales Report for January 2023   January 2022 Salisbury MD Home Sales Statistics In January 2023, the median single-family home sales price in the Salisbury MD area real estate market was $221,000. This was down 4% from the median sales price last January. There were 68 home sales, down 28% from the same month last year. The average time on market was 1.4 months, up from 1.3 months in January 2022. Currently, there are 2.0 months of supply of homes in Wicomico County.* This is determined by how many homes are available divided by how many homes sold the previous month.   Conclusions for Wicomico County Home Buyers For the second consecutive month, the median price of a home sold in Wicomico County was down on a yearly basis. Mortgage rates dropping into the low 6% percent range is more good news. The flip side is home inventory remains at a record low. As spring approaches, new inventory will pick but that’s also a time when many buyers enter (or re-enter) the market. While many thought multiple offers on a home were a thing of the past, they are becoming more prevalent in 2023.   Conclusions for Home Sellers in Wicomico County Wicomico County homeowners looking to sell soon should be optimistic even though the market peaked sales-wise last April, while area home prices peaked in November. What they shouldn’t expect, however, is a return to inspection and appraisal waivers, appraisal gap addendums, etc. The combination of near-record prices for homes and mortgage rates nearly doubling in 2022 has pushed many potential buyers out of the market. This has brought some balance to the local housing market and the white-hot intensity of 2021 is now the rear-view mirror. All that said, accurately priced homes in desirable locations will continue to sell in a matter of weeks, at least in the short term.   January 2023 Salisbury MD Real Estate Outlook We’re projecting around 60 homes will close in the Salisbury MD area by month’s end. If this proves correct, it will be the lowest February total for home sales since 2015. The demand is there but the inventory simply isn’t as discussed above. We went into greater detail on the tight home inventory issue in both the 2022 Year in Review and the Q3 Housing Report. *Based on information from the Coastal Association of Realtors® for the period 1/1/23 through 1/31/23 Information compiled by Vision Realty Group is deemed to be reliable but is not guaranteed. © BRIGHT MLS Copyright 2023

Wicomico Home Sales Decline in 2022, Prices Up

Salisbury MD Real Estate 2022 Year in Review   Salisbury MD Area Home Sales in 2022 There were 1258 home sales in Wicomico County in 2022, down 19% from 2021. The median sales price was $250,000, up 14% over the same period.* After a record-shattering 2021, the total for homes sold in the county came in as the fourth highest in history. Area home prices set an all-time record, however. The average time on market for properties sold in the Salisbury MD real estate market last year was 1.1 months.   Foreclosures and short-sale properties accounted for 3% of residential sales in 2022, unchanged from 2021. The median sales price of a home in Wicomico County has gone up 80% since 2014.   Salisbury MD Area Home Buyers in 2022 As mortgage rates rose throughout 2022, active buyers in the Wicomico County real estate market facing low inventory and record prices faced a new challenge. The affordability crunch quickly led to declining home sales in all four quarters. Many homeowners that were thinking of selling (but didn’t have to) stayed put instead of trading in a 3% mortgage for another at 6% plus. This is the primary reason why prices stayed elevated while home sales fell as there were still more buyers than sellers, even after mortgage rates effectively doubled. Home prices finally dropped in December after going up every month since August of 2020 on a yearly basis.   Salisbury MD Area Home Sellers in 2022 Since the economy re-opened in the summer of 2020, Wicomico County home sellers have enjoyed the best housing market in history. Sub 3% mortgage rates, working from home going mainstream and an influx of new residents from states with higher taxes and tighter COVID restrictions fueled an insatiable demand for housing on Delmarva for 18 months. Millennials are now the largest generation in U.S. history. Their need for housing also contributed to the perfect storm that was the Salisbury MD area real estate market from mid-2020 to the end of 2021. During this time, appraisal waivers, appraisal gap addendums, inspection waivers, escalation clauses, and multiple offers were common. Aggressive action by the Federal Reserve to rein in inflation changed everything beginning in early 2022. Mortgage rates spiked and priced many buyers out of the market. Throughout last year, home sales fell precipitously while prices rose as outlined above.   What Can the Wicomico County Housing Market Expect in 2023? At this time last year, we projected home prices to increase slightly (5%) and home sales to decline (2%). Both metrics were underestimated considerably. Long-term prognostications are an educated guess at best. The extent of the turmoil seen in the domestic residential real estate market last year was unexpected by many of the most respected and experienced authorities on the subject. For 2023, we believe home prices in the Salisbury MD area will fall around 3% and home sales approximately 7% as the market “normalizes” to something similar to 2019. The factors we’ll be watching include- Inflation and Fed Chair Jay Powell’s Response Recent comments by the Fed suggest their raising of the short-term Federal Funds Rate may be coming to an end soon. If so, mortgage rates likely peaked last year and could be back in 4% range by Q4. The Possibility of a Recession Many economists believe a mild recession is likely in 2023, specifically in Q3 and Q4. Unemployment Should the GDP contract, layoffs are a near certainty. A tighter labor market would mean slower wage gains and in turn, affect the housing market. The New GOP House Majority Historically, economic growth is more likely with divided government at the Federal level. Some hard choices will need to be made with the upcoming debt ceiling fight in Congress and subsequent budget measures, assuming one is passed and not a series of “omnibus” bills. *Based on information from Coastal Realtors® for the period 1/1/22 through 12/31/22 Information compiled by Vision Realty Group is deemed to be reliable but is not guaranteed. © BRIGHT MLS Copyright 2023

Q4 Home Sales Plunge, Prices Stabilize

Salisbury MD Real Estate Q4 2022 Sales Report   Q4 2022 Housing Statistics                  For the period of October 1 through December 31 in Wicomico County there were 255 settlements on single-family housing units, down 38% from this time last year.The median sales price was $233,500, up 1% over the same period.   Foreclosure and short-sale properties accounted for 3% of single-family home sales in the fourth quarter of 2022. This was up from 2% during the same period in 2021. *   Takeaways for Salisbury MD Area Home Buyers While Q1 of 2022 will go down as when Salisbury MD area home sales peaked, Q4 will be recorded as when home prices began declining in Wicomico County. Another potential bright spot for active homebuyers is mortgage rates have leveled off as well. Some industry insiders are predicting home loans will be down around 5% later this year.  Fewer buyers mean softer demand for home inventory. This will make sellers more likely to negotiate as well.   Takeaways for Salisbury MD Area Home Sellers With a market shift fully entrenched (declining homes sales soon to be followed by lower home prices over a period of about 9 months), prospective sellers looking ahead to the spring market in Wicomico County would be wise to not think it’s still 2021 regarding their home’s price. However, the shift is anything but a collapse as one might see in sensationalistic headlines a.k.a. “clickbait” online. Throughout this year, days on market should creep up along with slightly higher inventory. Tight home inventory and its primary cause for 2023 was discussed in the Q3 Housing Report.   What Lies Ahead for the Wicomico County Real Estate Market? Our Q4 home sales projection came in significantly lower than expected as the full impact of drastically higher mortgage rates became clear. The result was the lowest Q4 home sales total in Wicomico County in five years. A much slower December than expected was the primary driver. For Q1 of 2023, home sales and prices should closely resemble what we saw in Q4 of 2022 at around 250 units. Next week we’ll publish the 2022 Year in Review. *Based on information from the Coastal Association of Realtors® for the period 10/1/22 through 12/31/22 Information compiled by Vision Realty Group is deemed to be reliable but is not guaranteed. © BRIGHT MLS Copyright 2023