Sunday, January 29, 2006

Housing Prices – Down, Up, or In Between?

A couple of weeks ago, Janis Mara of Inman News wrote that the risk of housing prices going down is increasing. Inman is a leading source of real estate news, and Janis is always on top of the latest trends. Her article was based on a study by PMI Mortgage Company that some of the largest real estate markets in the country face a 50% or better risk of prices going down.

Janis and I talked about this, and I don’t actually agree – at least not for the Baltimore area. As I told her in my blog comment, I see prices leveling off. They are not going up like they were, and more properties are coming on the market. But there still is not too much inventory so houses do not sit on the market for a long time. I’m finding properties selling nicely although there are no bidding wars as there used to be. I still see it as a seller’s market but with better opportunity for young buyers to find their first home.

The Baltimore area benefits from being close to Washington, D.C. and all the government-related activity. Even if prices elsewhere go down, this area will probably stay level or even go up over the next few years. Thousands of families will be moving here as military bases are realigned and people follow the defense-related jobs.

Real estate is still a great investment.

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