January 2021 Housing Statistics in Montgomery County, Maryland
An evaluation of the housing statistics for Maryland and Montgomery County in January 2021 reveals that while buyers have made marginal gains, sellers continue to dominate this real estate market. In Montgomery County there was a 16.1% increase in units sold and a 13.3% increase in units pending this January compared to the previous year. Maryland experienced a similar phenomenon with a 14.2% increase in units sold and a 23% increase in units pending in the same timeframe. Though there were more pending units and units sold this January compared to last, active inventory and months of inventory have not improved much. Active inventory in Montgomery County dropped from 1,558 units in January 2020 to 871 units in January 2021; even more staggering is how active inventory in Maryland dropped from 18,367 units to 6,763 units in the same period.
With mortgage rates remaining at historic lows, buyers are eager to take advantage of competitive rates and increased purchasing power. But with this increased power comes a catch: average and median sales prices continue to check affordability. Average sales prices increased by 8.2% in Montgomery County and by 14.4% in Maryland while median sales prices also increased by 11.0% in Montgomery County and 12.4% in Maryland this January compared to the previous year. But even compared to the previous month there are notable changes: average and median sales prices in Maryland were lower in January 2021 compared to December 2020 while they were higher in Montgomery County. In January 2021 the average sales price for a home in Maryland was $387,118 while in Montgomery County it was $617,492; in December 2020 the average sales price for a home in Maryland was $396,273 while in Montgomery County it was $594,605.
The disparities between Maryland as a whole and Montgomery County in particular between January 2021 and December 2020 are also of interest: months of inventory in Maryland decreased from 1 to 0.8 while they remained the same at 0.8 in Montgomery County. Similarly the median days on market from January 2021 to December 2020 decreased from 10 days to 9 days in Maryland while remaining at 8 days in Montgomery County. One possible explanation is that with rising home prices and increased competition in Montgomery County, buyers may be considering expanding their search into other parts of Maryland.
While it is encouraging to see that the real estate market has started off the year strong, the relentless lack of inventory and fierce competition remain the greatest challenges to buyers. Though homes are moving quickly and are selling for more, these gains are being neutralized by the slow trickle of inventory to the market. Many agents are practically shouting from the rooftops that now is the best time to sell and if a deluge of sellers come to the market and help beef up inventory, things may be looking up for buyers. In the meantime, rates have been rock bottom for so long that some lenders and economists are predicting that they will start to rise again— though when that will be is unknown.
For buyers who are frustrated with losing house after house, and for sellers who may be daunted at the prospect of unleashing a horde of purchasers upon their home, call 301-780-HOME (4663) to find out how the Tamara Kucik Team can help.
Read our analysis of the housing market in December 2020 here.