Are You Ready for Maryland’s 2021 Real Estate Market?
After a tumultuous start to 2020, uncertainty behind the real estate market’s short-term future spread. Thankfully, we’ve all seen the agility and flexibility of this industry and how adaptive real estate agents can be. Sales continue to skyrocket as Maryland closes in on 8,500 units sold in November alone, an increase of 25.6% from the previous year. This uptick in sale numbers is a positive sign that homeowner activity will continue through the new year and well into 2021.
2021 Maryland Real Estate Outlook: Heating Up
Both home and rent prices have increased year-over-year, suggesting that demand within the state is still high. These figures are also experiencing movement from homeowners both within the state as well as out-of-state folks looking to relocate. The average sale price in November was $394,901, an 11.4% increase from 2019. Average rental prices throughout the state have increased to $1,700, demonstrating the increased demand for rental properties. This price will fluctuate depending on the neighborhood; as you could imagine, rental prices around the University of Maryland and Baltimore will be particularly competitive.
While there’s an increase in home and rent prices, Maryland’s home inventory continues to decrease. Currently, the active inventory is 9,153, which means there are 1.2 months of inventory remaining. This time last year, there were 22,445 homes that remained on the market. This significant decrease in available inventory reflects the current state of the market, which is in favor of sellers.
Currently, Maryland ranks seventh in the nation for the percentage of underwater properties. It’s also one of the wealthiest states in the country, which leaves you scratching your head. Equity gained is dependent on the county. There are ten counties in Maryland that had above-average negative equity rates, including both rural and urban counties. Maryland’s top agricultural county, Wicomico County, had the highest percentage at 9.1%.
Maryland’s delinquency rate on mortgages is 7.7% but saw a decrease within the last quarter from 8.2%. This is a good sign of a rebound within the state. Coupling this with Maryland’s current home equity rate, there are positive indicators that provide some optimism heading into 2021.
2020 Maryland Real Estate Market Data
|Zillow Home Value Index||$330,332|
|1-Year Change on Home Values||+5.5%|
|1-Year Change on Rent Prices||+2.9%|
|Homes With Negative Equity||4.1%|
|Delinquent on Mortgages||7.7%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for Maryland
While Maryland experienced high numbers of unemployment this summer as a result of the pandemic (sitting at a 10.0% unemployment rate in May), the job market and return to work over the last six months has made a positive impact. Currently, Maryland’s unemployment rate sits at 7.8%. This figure is still high compared to the unemployment rate in March 2020 but indicates a gradual return to stability in the job market. Luckily, large retailers like Under Armour have added many opportunities to the workforce in the state thanks to the opening of their second distribution center in the Baltimore metro area.
Despite the turbulent effects of the pandemic, Maryland continues to be an attractive state for professionals looking for work that's innovative and presents impactful opportunities. Maryland is ranked highly in a number of categories compared to the rest of the U.S.:
- First in its percentage of employed PhDs and Engineers
- Second in work opportunities
- Second most educated state
- Fifth most innovative state
Also noteworthy: Maryland has the highest income in the nation, not only driving value in the real estate market but also the state’s overall economic growth.
The current state of Maryland’s real estate market certainly reflects the ripple effects of COVID-19, but one should not underestimate Marylanders. While home equity and delinquency rates remain high, home value and sale prices continue to rise. Real estate agents need to stay on their toes through traditionally slow months. If there’s one constant for 2020, it’s that nothing from previous years will be the same. The high demand for homes and competitive environment is likely to remain well through this winter, and hopefully into the spring.
Take On 2021 With the Best Maryland Real Estate Courses From The CE Shop
Enroll in our Pre-Licensing program now to get your career started and begin connecting your fellow Marylanders with the home of their dreams. Or keep going strong with one of our comprehensive, 100% online Continuing Education packages. Want to stay up to date on everything in Maryland? Join the Mid-Atlantic Real Estate Facebook Group!