A TALE OF TWO CITIES?

The statistics are in, and Montgomery County home sales, which had been bucking the national price trend up through December 2007 has now slid into decidedly negative territory.

According to the latest figures released by GCAAR, average and median home prices are down significantly from July 2007 -- about the time the first rumblings of the subprime mortgage crisis began to be heard. While many jurisdictions had already started their downward slide at that point, Montgomery County -- with some of the most desirable markets nationally such as Bethesda-- was holding steady.

Compared with July 2007, average prices dropped from approx. $617,000 to $587,000, while median prices went from $500,000 to $467,000. That's about a 7% drop in the median. Median prices, the point at which half of home sales had a higher price and half a lower price, is considered a more telling figure than averages.

But looking at the 20814 zip code of Bethesda, an area in which I do a lot of business, because of my involvement as a parent at the Lycee Rochambeau / French International School located there, the statistics tell a different tale. Indeed, judging by those figures, parts of Montgomery County continue to see some pretty healthy appreciation. The re-sale figures for single family homes as reported by MRIS show average sold price in 20814 rising in July 2008 over the year before from $677,000 to $808,000 -- about a 19% price increase. WOW! The median rose from $635,000 to $727,000, over a 14% increase.

But sellers beware: this does not mean a return to the heady days of the sellers' market. The number of transactions is down considerably (nearly 11%) and the average days on market is up 45%. Properties need to be in tip top shape to sell, they require excellent staging and aggressive and high tech marketing in order to attract buyers. The ball is still in the buyer's court in this market.  

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