The 1,454 homes sold in the Baltimore Metro Area represent the highest February total since 2007. Inventory levels continue to decline with 11,919 active listings at the end of February representing the lowest supply of homes since March 2006. With 440 active foreclosures representing only 3.7% of the active inventory (the lowest level since November 2008) and a shift in the composition of homes types sold, the median sales price for the region saw an annual (year-over-year) increase for the first time in 16 months.

KEY TRENDS

Pricing
For the first time since October 2010, pricing in the Baltimore Metro Area showed an annual gain, with a median sales price of $210,000 in February 2012 representing a modest 2.3% increase over February 2011. Townhouse properties saw the largest year-over-year gain in median sales price, up 27.4% to $152,875. While the median sales price for traditional listings was down 8.5% year-over-year, median sale prices on bank-mediated properties (short sales and foreclosures) rose 32.5% to $149,000.

Closed Sales and New Contracts
There were 1,454 homes sold in the Baltimore Metro Area in February, 4.9% higher than the five-year February average and representing a 7.4% increase over February 2011 and a 9.0% increase over last month. The 795 detached properties sold in February were 16.9% higher than last February’s level, though the 659 attached properties sold represent a 2.2% year-over-year decline. This relative shift in the home type composition of the sold market may partially explain the year-over-year increase in median sales price. Another positive pricing factor is the increased market share of traditional sales (those not involving short sales or foreclosures), which increased from 64.1% of sales in February 2011 to 71.5% of sales in February 2012. The 1,040 traditional sales represent a 19.8% year-over-year increase while the 228 foreclosure sales represent a 39.5% decline from February 2011.

There was a significant uptick in new contracts in February, with the 2,489 new contract agreements signed representing an 18.7% increase over January and 16.0% over February 2011. For context, the 10-year average increase between January and February contracts is 7.6% and the 2,489 level is 25.8% higher than the five-year February average. The increase in contract activity was influenced by continued low interest rates, increasing consumer confidence and unusually mild winter weather compared to years past and is a promising sign heading into the spring market.

New Listing Activity
It’s difficult to say if the milder weather drew more potential sellers into the market (or, more likely, kept them out of the market during the harsh weather in February 2011), but the 3,243 new properties listed in February are 3.0% higher than the same period last year. February marked the first time since May 2011 that the area saw a year-over-year increase in new listing activity. The February new listings level is 14.5% higher than last month, bucking the 10-year average trend of new listing activity decreasing 4.8% from January to February. There was a significant increase in attached properties entering the market, with 1,516 new listings representing an 18.1% month-over-month increase. New detached homes entering the market were 11.6% higher than number newly listed in January.

The 2,577 new traditional listings, or those not involving a short sale or foreclosure, represented a 21.8% jump from the January 2012 level and an 8.7% increase over February 2011. The 241 new listings entering the market under foreclosure 37.9% fewer than February 2011, though the 427 newly listed short sales represent an 8.1% year-over-year increase.

Overall Inventory

After months of reports describing a dwindling supply of inventory, where does this purchase activity vs. increased new listing activity leave the supply story for the Baltimore Metro Area at the end of February? The story remains the same: Active inventory is at the lowest level since March 2006. The 11,919 active listings to close the month represent a 24.0% dip from February 2011 and are 22.9% fewer than the five-year February average. While traditional listings are down 21.9% year-over-year, active inventory of foreclosures and short sales are down 68.9% and 6.7% respectively.