Scott Smolen's Anne Arundel County and Bowie, Md. Real Estate Blog

If you are curious about the home statistics for detached homes, townhouses, and condominiums in Annapolis, Md. then you have come to the right place.  There are several charts below that provide a comparison to the data from last year.  These charts are updated on a monthly basis, so you will be able to keep an eye on the trends in the market.

This first chart shows the closed sales in Annapolis month-by-month compared to the same time last year.

This next chart provides the data for the median days on the market for homes in Annapolis.  

This chart provides a look into the Supply and Demand of homes located in Annapolis.  This showing the monthly supply of homes in the city.  This Economists' Article explains what this data means in general.  The lower the number, the more skewed the market is to Sellers.  It is the opposite for a Buyer's market.

This last chart displays the median sales price to original list price ratio for homes located in Annapolis, Maryland over the last year. 

Please feel to to send us a message if you have any questions about any of this data, or if you would like some additional information about the housing market in Annapolis, or some other areas that interest you.  We will be happy to do anything we can to help!

Annapois, Md.  - Recently Listed Annapolis Homes for Sale

New home sales rose in February for the 3rd month in a row.

New homes continued to rise in February, jumping 1.1% from January to a seasonally adjusted annual pace of 640,000 homes, according to data published on Thursday by the U.S. Census Bureau and HUD.  On a year-over-year basis, however, new home sales are still down 19.0%.

The uptick in the sales pace in February resulted in a 0.7% monthly decrease in new home inventory, with just 436,000 new homes remaining on the market at the end of the month. This represents 8.2 months of supply at the current sales pace.

“Homebuilders are still feeling cautiously optimistic about a strong spring home buying season, despite mortgage rate volatility and economic uncertainty,” Lisa Sturtevant, the chief economist at Bright MLS, said in a statement. “A key reason for builder optimism is the very low inventory in the existing home market, which will force more buyers into the new home market.

The number of existing homes for sale is still less than half of what it was prior to the pandemic. In many markets, buyers are still facing stiff competition, often making offers on multiple homes before successfully purchasing.” As a result of this increased competition, the median sales price on new homes sold in February was $438,000, up 36.7% year over year. “Higher mortgage rates, which approached 7% last month, have taken a toll, eroding buyers’ purchasing power,” Sturtevant added.

“Builders had been reluctant to drop prices, but the economic reality made downward pressure on price growth inevitable. Prices nationally are still more than 30% higher than they were three years ago.” Regionally, the sales pace was down in the Northeast (21,000 homes) and the Midwest (71,000 homes) on a month-over-month basis, with the Northeast recording the larger drop at 40.0%. The South (415,000 homes) and the West (133,000 homes) were both up month over month, rising 3.0% and 8.1%, respectively. On a yearly basis, all regions recorded drops in annual sales pace, with the Northeast recording the largest drop at 55.3%.

Click here if you are curious to what new construction homes options are available in our local market.  The Scott Smolen Team is happy to represent you in your new construction purchase.  You do not pay any fees for our representation.  If you are curious to how the process works, just let us know and we will be happy to discuss everything with you and there is no obligation at all.  Put our 24 years of experience to work for you, for free!

Despite facing significant market volatility, mortgage bond prices remained almost unchanged by the end of the week. There was a considerable amount of selling at the start of the week as investors anticipated the expected Fed rate hike. As anticipated, the Fed raised rates by 25 basis points, resulting in a bounce-back in trading activities later in the week.

Mixed data was reported in the housing market as existing home sales grew by 14.5% compared to the 5% increase, while consumer sentiment was reported at 63.4 compared to the expected 67, and weekly jobless claims were 191K vs. 193K. New home sales totaled 640K vs. the expected 650K. Durable goods orders, however, fell 1%, missing the expected 0.6% increase. Mortgage interest rates improved by approximately 1/8 of a discount point by the close of the week.

There was a notable uptake in purchase mortgage applications, which increased by 2% the previous week. This increase can be attributed to the fall in average contract interest rates. The refinance applications also saw a rise of 5%.  Nevertheless, market experts expect that the Fed will have to decrease rates by July. In terms of employment, there was an unexpected decrease in unemployment applications for the second week, indicating that the job market remains stable. 

In February, there was a significant increase in existing home sales by 14.5%, marking the first monthly gain in 12 months. This surge was the largest since July 2020. The median price of an existing home sold during this period was $363K, which represents a slight annual drop of 0.2% nationally. Interestingly, this was the first price decrease in more than ten years.

If you are curious about the home statistics for detached homes, townhouses, and condominiums in Crofton, Md. then you have come to the right place.  There are several charts below that provide a comparison to the data from last year.  These charts are updated on a monthly basis, so you will be able to keep an eye on the trends in the market.

This first chart shows the closed sales in Crofton month-by-month compared to the same time last year.

This next chart provides the data for the median days on the market for homes in Crofton.  

This chart provides a look into the Supply and Demand of homes located in Crofton.  This showing the monthly supply of homes in the city.  This Economists' Article explains what this data means in general.  The lower the number, the more skewed the market is to Sellers.  It is the opposite for a Buyer's market.

This last chart displays the median sales price to original list price ratio for homes located in Crofton, Maryland over the last year. 

Please feel to to send us a message if you have any questions about any of this data, or if you would like some additional information about the housing market in Crofton, or some other areas that interest you.  We will be happy to do anything we can to help!

Crofton, Md. 21114  - Recently Listed Crofton Homes for Sale

The Federal Reserve policymakers approved a 25 basis point rate hike to a target range of 4.75 percent to 5 percent in their campaign to combat inflation. The Fed also announced that it will continue to reduce support for mortgage markets during the pandemic by letting $35 billion in mortgage-backed securities and $60 billion in Treasuries roll off its balance sheet each month as part of its "quantitative tightening" plan.

While some had doubts about the Fed's rate-hike campaign after the failures of Silicon Valley Bank and Signature Bank, policymakers sent a signal that they believe the banking crisis has been contained and they remain committed to controlling inflation. However, Federal Reserve Chair Jerome Powell expressed caution, stating that events in the banking system may result in tighter credit conditions and that it is too soon to determine how monetary policy should respond.

Chief economist for the Mortgage Bankers Association, Mike Fratantoni, described the Fed's latest move as a "dovish hike" and predicted that mortgage rates will trend down this year, which will provide support for the purchase market. The MBA's weekly survey of lenders indicates that homebuyer demand for purchase loans increased for the third week in a row as mortgage rates eased, and the wide spread between 10-year Treasury yields and 30-year fixed-rate mortgages suggests that mortgage rates could come down further if bond yields stabilize.

There is a tried and true saying in the real estate business.  You marry the house and date the mortgage rate.  If you are considering buying a home and plan to be there for at least the next 3 years, it is likely a very good time for you to buy.  As rates come down, then you can refinance your home to a lower mortgage rate when that happens.  If you are only going to be in your next home 3 years or less, then you might be best served by renting.  However rents have gone up and continue to go up steadily, so keep that in mind as you plan.    

The higher rates in today's market are still historically low.  However since home prices have appreciated quickly the home affordability index is not as low as it once was.  If you take a look at the chart below, you will see that the home affordability index peaked in October of 2022 when mortgage payments were averaging 27.4% of a home's income.  They have dropped since then and are coming in at 23.8% in January 2023.  Although 23.8% is better, compared back to 2020, it is much higher than 14.7%.  These numbers are important since the factor impacting the higher percentage the most is the mortgage rate.  Back in 2020, the average was 3.17% compared to 6.35% in January 2023. 

If you buy a home where you are comfortable with the payment at rate in the low 6's, then you will be much more comfortable when you are able to refinance at a lower mortgage in the future as the economists are predicting.  The majority of those who bought back in 2020 during a period of uncertainty due to Covid made very good investments. 

The Largest Part of Most Homeowners’ Net Worth Is Their Equity - You may be surprised to learn just how much of a homeowner’s net worth actually comes from owning their home. The National Association of Realtors (NAR) shares: “Homeownership is the largest source of wealth among families, with the median value of a primary residence worth about ten times the median value of financial assets held by families. Housing wealth (home equity or net worth) gains are built up through price appreciation and by paying off the mortgage.”

This is a good time to explore ARM's and fixed rate buydowns as options to buy.  There are good mortgage options available if you are in the market to plant some roots and enjoy all of the benefits of home ownership.  This is a bumpy market and there are a lot of moving parts.  If you would like to discuss your options, please feel free to reach out to us and we will be happy to talk.

A home warranty is a contract between a homeowner and a home warranty company that covers the cost of repairs or replacements for major home systems and appliances. It's different from homeowner's insurance, which covers damage to the home from unexpected events like fires, floods, and natural disasters. A home warranty, on the other hand, covers the cost of repairs or replacements for things like the HVAC system, plumbing, electrical systems, and major appliances like refrigerators, ovens, and dishwashers.

How does a home warranty work?

When a homeowner purchases a home warranty, they pay an annual fee, which varies depending on the level of coverage they choose. The home warranty company will then provide coverage for the homeowner's covered systems and appliances, as outlined in the contract. If a covered system or appliance breaks down or malfunctions, the homeowner can file a claim with the home warranty company. The home warranty company will then send a licensed and insured contractor to diagnose the problem and provide a repair or replacement, if necessary.  There is usually a deductible per repair that ranges depending on your particular policy terms.

What are the benefits of a home warranty?

There are several benefits of having a home warranty, including:

1. Protection against unexpected repair expenses: Homeowners can be hit with unexpected repair expenses at any time, which can be expensive and disruptive. With a home warranty, homeowners can rest assured that if a covered system or appliance breaks down, they won't be hit with a large repair bill.

2. Peace of mind: Knowing that major home systems and appliances are covered by a home warranty can provide homeowners with peace of mind. They can feel secure in the knowledge that if something goes wrong, they won't have to worry about finding a reliable contractor or paying for repairs out of pocket.

3. Convenience: Homeowners don't have to spend time searching for a reliable contractor when something breaks down. The home warranty company will provide a licensed and insured contractor to diagnose and repair the problem.

4. Increased home value: A home warranty can increase the value of a home, particularly if it's being sold. Home buyers may be more likely to purchase a home that comes with a home warranty, as it provides an extra layer of protection and peace of mind.

5. When Selling your home, a home warranty also provides a layer of liability protection.  For instance, if you sell your home and the Buyer comes to their house immediately following closing to find their refrigerator is not working they can call the home warranty company to evaluate and repair.  Without a warranty, the Buyer could claim a Seller knew about the problem and did not tell them.  That would be up to a court to decide, but why risk something like that in the first place.  The home warranty provides both the Buyer and the Seller with peace of mind. 

In conclusion, a home warranty can provide homeowners with peace of mind and protection against unexpected repair expenses. It's important to carefully review the terms and coverage of a home warranty before purchasing, to ensure that it meets your needs and covers the systems and appliances that are most important to you.

Real estate transactions involve a significant amount of money, and it is essential to understand the different terms and concepts involved. Two of the most common terms used in real estate transactions are earnest money deposit (EMD) and down payment. While both payments are made at different stages of a real estate transaction, they serve different purposes.

What is an Earnest Money Deposit?

An earnest money deposit is a payment made by a Buyer to Seller as a sign of good faith. It is typically a small percentage of the total purchase price, usually ranging from 1/2% to 2% of the contract price in resale purchases.  Builders tend to require a larger earnest money deposit for new construction.  These can range from 2%-10%. The purpose of the earnest money deposit is to show the Seller that the Buyer is serious about purchasing the property.

Once the Seller accepts the offer, the earnest money deposit is held in an escrow account until the closing of the sale. At closing, the deposit is credited towards the total purchase price of the property. If the buyer fails to perform as obligated per the contract, the Seller may keep the earnest money deposit as compensation for taking the property off the market.  Failure to perform does NOT encompass valid contingencies including, but not limited to a home inspection, appraisal, financing approval, home owner association document review and more.  Failure to perform can include actions such as a loan fraud, a Buyer's failure to cooperate in good faith with their lender, and other actions along those lines.   

What is a Down Payment?

A down payment is a payment made by a buyer towards the total purchase price of a property. It is typically a percentage of the total purchase price, usually ranging from 3% to 20% (as little as 0% when using a VA loan and other select programs). The purpose of the down payment is to reduce the amount of money that the buyer needs to borrow from a lender. Most lenders require a down payment to secure the mortgage loan. The more significant the down payment, the lower the loan amount, and the lower the monthly mortgage payments.

For example, a 20% down payment on a $300,000 home purchase would require a payment of $60,000. This reduces the mortgage loan amount to $240,000, resulting in lower monthly payments.

Key Differences between an Earnest Money Deposit and a Down Payment

The key differences between an earnest money deposit and a down payment are as follows:

1. Purpose: The earnest money deposit shows the Seller that the Buyer is serious about purchasing the property, while the down payment is a payment made towards the total purchase price to reduce the loan amount.

2. Amount: The earnest money deposit is typically a small percentage of the total purchase price, while the down payment is a more substantial percentage of the total purchase price.

3. Timing: The earnest money deposit is made when the Buyer submits an offer, while the down payment is made at closing.

4. Refundability: The earnest money deposit is typically non-refundable if the Buyer fails to perform as obligated per the contract of sale.  If the Buyer terminates a contract due to a valid contingency within the appropriate time frame of that contingency, then EMD should be returned to the Buyer in full unless specifically stated otherwise in the Contract.  In contrast, the down payment is not made until settlement.  In the event the settlement does not occur, then no down payment will be made, so there will be nothing to return.  

In summary, while both an earnest money deposit and a down payment involve making a payment towards the purchase of a property, they serve different purposes and are made at different stages of the transaction. As a Buyer, it is essential to understand the differences between the two to ensure that you are making the right payment at the right time and for the right reason.

If you are considering selling your home this Spring season, these 8 tips below will help you get the maximum value for your property.  Curb appeal is important when it comes to attracting potential buyers to your home. The first impression they have of your property will be the exterior, so it's important to make sure it looks its best.  Many Buyers will drive by homes before scheduling to see the interior of them.  Here are some relatively easy ideas to help you maximize your home's curb appeal:

1) Keep the lawn well-maintained: A well-manicured lawn can make a big difference in how your home is perceived. Make sure to mow, edge, and trim regularly to keep the lawn looking neat and tidy.

2) Add some color: Consider planting some flowers or adding some colorful planters to the front porch or entryway. This can add a pop of color and make your home look more inviting.  Pansies are a good choice for early seasonal color in Maryland.  As we move into the hotter months, then other options include Annual Vinca for areas in full sun and Impatiens for areas that have more shade.  

3) Trim overgrown bushes and trees: Overgrown bushes and trees can make your home look unkempt and even hide its features.  Trim them back to improve your home's appearance and let more natural light in. 

4) Clean up debris: Make sure to clean up any debris or clutter around the exterior of your home, such as leaves, branches, or trash. This can make a big difference in how your home is perceived by potential buyers.

5) Enhance the driveway and walkways: Repair any cracks in your driveway or walkways and consider power-washing them to remove any stains or grime. You can also add a fresh coat of sealant to make asphalt driveways look brand new.

6) Add some mulch: Fresh mulch can make your flower beds look neat and tidy and also help retain moisture for your plants. Consider adding a fresh layer of mulch to your landscaping.  The black dyed mulch will provide a fresh look of contrast for months after installing it.  This can be purchased by the bag, or in bulk as well.  

7) Paint the front door: A fresh coat of paint on the front door can give your home a quick and easy facelift. Choose a color that complements your home's exterior and adds some personality.  This is where Buyers and their agents tend to spend a few minutes while accessing the key from lockboxes so it is important to have the area look clean and fresh.  

8) Pressure wash the exterior: Over time, the exterior of your home can accumulate dirt and grime. Consider hiring a professional to pressure wash your home's exterior to remove any build-up and make it look fresh and clean.

By following these exterior and landscaping tips, you can help maximize your home's curb appeal and make a great first impression on potential buyers.

If you are curious about the home statistics for detached homes, townhouses, and condominiums in Bowie, Md. then you have come to the right place.  There are several charts below that provide a comparison to the data from last year.  These charts are updated on a monthly basis, so you will be able to keep an eye on the trends in the market.

This first chart shows the closed sales in Bowie month-by-month compared to the same time last year.

This next chart provides the data for the median days on the market for homes in Bowie.  

This chart provides a look into the Supply and Demand of homes located in Bowie.  This showing the monthly supply of homes in the city.  This Economists' Article explains what this data means in general.  The lower the number, the more skewed the market is to Sellers.  It is the opposite for a Buyer's market.

This last chart displays the median sales price to original list price ratio for homes located in Bowie, Maryland over the last year. 

Please feel to to send us a message if you have any questions about any of this data, or if you would like some additional information about the housing market in Bowie, or some other areas that interest you.  We will be happy to do anything we can to help!

Bowie, Md. 20715, 20716, 20720, 20721  - Recently Listed Bowie Homes for Sale

One of the many benefits of living in such close proximity to our Nation's Capitol is being able to attend the Cherry Blossom Festival.  This year the Cherry Blossom Festival is scheduled for March 18th - April 16th, 2023.  The Peak Bloom is predicted for March 22-25!  The Cherry Blossom Festival in Washington, D.C. is an annual celebration of the blooming of the cherry blossom trees that were gifted to the United States by Japan in 1912 as a symbol of friendship between the two nations. 

During the festival, visitors can enjoy a variety of events and activities, such as the Blossom Kite Festival which is scheduled for Saturday, March 25th from 10 AM - 4:30 PM at the Washington Monument Grounds as well as some other parks in the area.  You can learn more about the Blossom Kite Festival here.  

If you are a runner, then don't miss the Cherry Blossom 5K and 10 Mile runs.   The 5K is happening on April 1st at 9:15 AM and the 10 Mile run is on April 2nd at 7:30 AM.  You can learn more about Both Runs here.  

Be sure to mark your calendars for 10 AM on April 15th if you want to attend the National Cherry Blossom Festival Parade.  There are also plenty of cultural performances, art exhibits, and food vendors showcasing Japanese and American cuisine.

In addition to the festival events, visitors can also take a stroll through the Tidal Basin to admire the beautiful cherry blossoms in bloom. The Tidal Basin is lined with over 3,000 cherry blossom trees, making it a popular spot for photography and picnics during the festival.  This is an event that visitors come from all around the world to participate in.  If you have not gone before, prepare to be impressed when you see these magnificent Cherry Blossoms.