Real Estate Marketing & Beyond
If you're considering buying a home in Maryland in 2024, you’ll want to go in fully prepared for the state's competitive real estate landscape. While rising prices and mortgage rates present challenges, it’s still possible to find your dream home with the right strategy. This article explores the key factors home buyers need to know about the Maryland housing market this year.
In a seller’s market like Maryland, getting pre-approved for a mortgage loan should be one of the first steps for hopeful buyers. Pre-approval provides a significant advantage by showing sellers you are a serious buyer with the financing ready to make a purchase. It also allows you to move quickly with an offer when you find the perfect home.
A lender will assess your financial profile including income, assets, debts and credit score to determine the loan amount you qualify for. This gives you a price range to target in your home search. With rising mortgage rates, run the numbers to ensure your target home is still affordable based on projected monthly payments. You'll also need to factor in property taxes, insurance, HOA fees, and other ownership costs.
With limited housing inventory, you may need to cast a wider net geographically and consider neighborhoods you may not have previously. Expand your online searches and drive around target areas to get to know them better. Consider tradeoffs like commute times or school districts. Increase your price range filter if needed to see more options.
At the same time, know your must-haves. Decide which features are necessities like yard space or an updated kitchen. This helps you move quickly when the right home pops up. Sign up for listing alerts to be among the first to view new properties. Check multiple times per day as inventory moves fast. Drive by listed homes to get a feel for the neighborhood.
Offering above the asking price and waiving contingencies like financing and inspections have become common tactics for winning in bidding wars. But carefully consider how high you’re willing to go and the risks involved.
Get a comparative market analysis from your real estate agent to determine fair value pricing for the neighborhood. Don’t get emotionally swept up and overpay. Remember that appraisals align with market value, not simply what you offer, which could jeopardize financing.
If waiving inspection contingencies, have the home pre-inspected so you enter informed on its condition. Consider keeping your finance contingency for your protection. Build in escalation clauses to increase your offer automatically if competing bids come in higher.
Congratulations, your offer was accepted! But don’t let down your guard just yet. Conduct thorough property inspections to uncover any issues needing negotiation with the seller.
Carefully review the inspection report results and get contractor estimates for any significant repairs needed. For minor fixes, request a credit at closing. For more serious structural or system problems, renegotiate the purchase price if needed.
Stay in close contact with your lender to ensure the smooth processing of your mortgage and avoid any last minute surprises. Provide prompt responses and documentation if anything additional is needed.
Schedule your final walkthrough inspection 1-2 days before closing to allow addressing any concerns if the condition changed. Review closing documents and costs ahead of time so there are no questions later.
Double check the details of your closing costs estimate. Bring a cashier's check for your down payment and closing costs. Have your insurance binder ready to provide as well.
According to projections from Zillow, home prices in Maryland are expected to continue rising in 2024, though at a slower pace than recent years. Zillow forecasts a 2.8% home value increase in Maryland for 2024. While a market correction is possible, conditions do not point to a 2008-level housing crash. The housing shortage and strong buyer demand should continue supporting prices.
The Maryland housing market remains competitive, and home prices are expected to continue appreciating in 2024. Metrostudy, a housing market research firm, forecasts around 2% price growth in Maryland for 2024. Their data shows the median new home sale price up 7% in Maryland year-to-date. While price gains may moderate, a drop in values is not anticipated statewide next year.
Housing markets can vary significantly across different regions within Maryland. For 2024, the Greater Baltimore area expects steady price appreciation around 3%, while the DC metro suburbs may see slower gains around 1-2% after rapid spikes. Outer suburbs and rural areas generally offer relative affordability for buyers willing to commute farther.
Mortgage rates are forecast to remain high in 2023 and 2024 compared to pre-pandemic years. According to Freddie Mac projections, the average 30-year fixed mortgage rate was 5.4% in 2023. This is over 2 percentage points higher than rates under 3% seen in the early months of the pandemic.
In 2024, rates may rise slightly from 2023 levels, averaging around 5.6% over the course of the year according to forecasts. This continuing rate increase further reduces buyer purchasing power.
On a $300,000 loan amount, the monthly mortgage payment at 5.4% is approximately $400 higher than a 3% rate. At a 5.6% rate in 2024, the monthly payment increases by another $25 compared to 2023.
First-time and move-up buyers, especially those on tighter budgets, will feel the impact of higher payments. Home sellers may need to adjust asking prices accordingly as buyers lose purchasing power.
Those in the market to buy may consider adjustable-rate mortgages or shorter terms like 15-year mortgages to offset the higher rates. While rates remain elevated compared to pre-pandemic, homeownership is still achievable for qualified buyers who account for the impacts of rising rates in their budget and search.
Maryland offers down payment and closing cost assistance programs for qualified home buyers through the Maryland Mortgage Program. These include low interest mortgages and grants or loans repaid upon home sale. Other options are FHA loans requiring just 3.5% down and employer programs offering home purchase grants. For targeted areas, funds may cover your entire down payment. Utilize these programs to improve affordability.
First-time buyers should get pre-qualified by multiple lenders to find the optimal loan programs and rates. Attached housing like condos and townhomes offer lower entry costs. Take a homebuyer education course and check for seller closing cost credits. The right agent can inform you on local grants and seller incentives to maximize savings. Patience and persistence are key to finding the right home.
When you find a home that perfectly matches your wants and needs, be prepared to move fast. Depending on the area, bidding wars within hours or days of listing are common. The first day on market is often the most critical.
Have all your paperwork and financing in order for your offer submission. Request priority handling from your lender if they need to turn around verification of funds quickly. Waive the financing contingency at your own risk.
Include an expiration clause of 24-48 hours on your offer to pressure the seller to act. But avoid letting emotion push you to act rashly or overpay. Remain level-headed about your budget and limits.
Also consider hiring a moving company like Next Generation Movers to handle your relocation needs. A professional moving service can make your transition into your new home smooth and stress-free. They'll handle packing, loading, transportation, and unloading of your belongings. This leaves you free to focus on the closing process and other details.
Moreover, quality movers have the right equipment and expertise to properly protect your items. They can disassemble and reassemble furniture as needed. Specialty packing materials help secure delicate possessions. Choose a company that provides full valuation coverage in case anything gets damaged.
Evaluate multiple quotes and read reviews to find movers that offer superb service at a reasonable price. Book early as the best companies book out well in advance. Giving yourself time to organize, pack, and label boxes also avoids last-minute hassles. With the right moving partner, you'll be settled into your new Maryland home in no time.
Buying a home in Maryland takes effort given the competitive landscape. But being an informed buyer sets you up for success. Know your must-haves, understand latest trends and pricing, and be ready to act on the right home. With the proper preparation and support, your dream of Maryland homeownership is within reach.
What is more important to know is that Maryland remains a popular relocation destination given its proximity to DC and Baltimore job centers, plus top-ranked schools and healthcare. New residents should budget for moving expenses and applicable taxes. Securing temporary housing can provide time to search for the perfect home. Focus your search once you experience target neighborhoods in person.
