Is Baltimore going to be a sizzling real estate market for investors over the next twelve months? According to NeighborhoodScout's data, Baltimore's appreciation rate has been at 15.50 percent over the last year. Baltimore's appreciation rate in the most recent quarter was 5.74 percent, which equates to 25.03 percent (annual appreciation). In comparison to the rest of Maryland, Baltimore's most recent annual appreciation rate is higher than 60% of the other cities and towns in Maryland.
You can either choose to invest in your future or market your home to potential buyers. If you are looking for an affordable real estate market with a high potential for return on investment, you should consider Baltimore, MD. New employers and investments continue to add to the long list of reasons why people desire to live in Maryland. In this article, our focus will be on the current state of the Baltimore real estate market and how it can affect investors and home buyers.
Statistics from Bright MLS show that in May 2022, housing demand in the Baltimore metropolitan region decreased. All market sectors in the Baltimore-Washington Metropolitan Area had a decline in demand during the month, with the exception of luxury condominiums, which saw a little increase. The greatest reduction in buyer interest occurred in single-family houses and condominiums with the lowest prices.
The month's supply for each kind of property varied relatively little month-over-month, ranging from 0.9 months for mid-priced single-family homes and lower-priced condominiums to 1.9 months for more expensive condos. For more details read the Greater Baltimore housing market trends below.
Maryland Housing Market Trends (Monthly Statistics)
Here are the Maryland housing market trends as seen in April 2022, according to the yearly report from Maryland Realtors. Statewide, sales hit 7,933, down 13.9% from the previous year. It shrunk the monthly supply of inventory to 0.8 months, which means it will take less than a month for the current inventory of homes on the market to sell given the current sales pace. Therefore, Maryland is expected to be a tight housing market in 2022, favoring home sellers.
Housing inventory remains very low compared to the demand from homebuyers. As a result, the median sales price reached $390,000 in April, which is 8.3% higher than last April's median price of $360,000. The median price is the middle value of the prices of all homes sold in the period in Maryland — the price at which half the sold homes are above and half are below in selling price.
Homes spent a median time of 6 days on the market, the same as the previous year. The median represents the middle, with half of the homes spending more time and half spending less. Among Maryland's 24 jurisdictions, Montgomery County reported the most sales in April, as 1,227 units were sold. Kent County had the fewest, with 30 closed sales in April.
Sales declined in all the counties except for Caroline County (+4.8%), Somerset County (+9.4%), and Wicomico County (+4.0%). Caroline County reported the highest median price growth of +36.9% from the previous year (from $231,950 to $317,500). Homes sold fastest in Harford County with the median days on market being the lowest in the state (4 days).
Montgomery County was the most expensive real estate market in Maryland with a median sales price of $587,000 in April 2022. Allegany County was the least expensive real estate market in Maryland with a median sales price of $117,450.
Maryland Housing Market Report For Last Year (Annual)
- 106,804 units were sold in 2021, up 10.5% year-0ver-year.
- The average sales price was $426,388, up +11.2% year-0ver-year.
- The median price was $361,000, up +9.4% year-0ver-year.
- Total pending sales were 106,102 whereas in 2020 there were 99,183 pending contracts.
- The ACTIVE INVENTORY was 6,447 units whereas in 2020 it was 10,385 units for sale.
- MONTHS OF INVENTORY was 0.7 in 2021 whereas in 2020 it was 1.3.
- MEDIAN DAYS ON MARKET was 7 whereas in 2020 it was 11.
- NEW LISTINGS were 122,287 whereas in 2020 there were 112,359 new listings.
Baltimore Housing Market Trends (Monthly Statistics)
Because of historically low-interest rates, the real estate market in Baltimore has been booming during the pandemic. Despite rising rates, the real estate market is currently performing exceptionally well. Baltimore's housing supply is consistent with the national trend of increased demand for single-family homes. Baltimore currently has less than one month's worth of housing inventory available.
State of the Market
- In April 2022, 962 housing units were sold in Baltimore County versus 1,065 last year, according to Maryland REALTORS® Monthly Statistics.
- The total number of units sold last month was lower than at this time last year, representing a 9.7% decrease over April 2021.
- The median sale price was $325,500, up 14.2 percent or $40,450 more from the previous year.
- It means that sellers are increasing their prices in response to an increase in demand.
- The median sale price for Baltimore City was $231,500, an increase of 7.2% or $15,500 more as compared to last year.
- 996 homes were sold in Baltimore City in April 2022 versus 1,087 last year, an 8.4% drop in sales.
- The median days on market were 5 in Baltimore County and 9 in Baltimore City.
Baltimore County Housing Inventory
- The total number of available homes is down by 325 units or -31.7%.
- This April, the total number of active inventory was 698, compared to 1,023 in Apr 2021.
- Baltimore County had 0.7 months of supply available, compared to 1.0 months in Apr 2021.
New Listings & Pending Sales
- In April there were 1280 homes newly listed for sale in Baltimore County compared to 1415 in Apr 2021, a decrease of 9.54%.
- There were 775 current contracts (pending sales) compared to 809 a year ago.
- The number of pending sales was down by 6.8% as compared to last April.
Baltimore Listing Price Trends 2022
- Baltimore was a seller's market in April 2022 as it had a total sales to total listings ratio above 0.2 which tends to favor sellers.
- According to Realtor.com, in April 2022, the median list price of homes in Baltimore County was $329.9K, trending up 11.8% year-over-year.
- If Median Listing Price is trending up, the market may be “hot” and homes will likely be selling more quickly.
- Sellers have the advantage when prices are going up.
- The median listing price per square foot was $186.
- The median sale price was $325K.
- Sale-to-List Price Ratio: 100.53%
- Ideally, a buyer would prefer a sale-to-ask price ratio that’s closer to 90%.
- The sellers in Baltimore have managed to hold good leverage in these negotiations in the past month.
- On average, they could sell homes for 100% of the asking price.
- A seller would always prefer scenarios that can yield a ratio of 100% or higher.
Greater Baltimore Housing Market Trends (Latest)
Here are the latest monthly real estate trends for Greater Baltimore (the city and surrounding suburbs in Baltimore County) published by Bright MLS, the multiple listing service serving Baltimore and throughout the Mid-Atlantic region. In April, demand for homes in the Baltimore metro area increased 4.1 percent marking the fourth consecutive monthly increase since the seasonal low in December. The Index, at 127, reflected a Moderate pace of buyer demand in the region.
Demand has climbed over the previous four months, albeit at a slower rate this spring than it did last spring. In April, the Index was more than 17 percent lower than it was twelve months prior. In addition to limited inventory levels, the increase in mortgage rates and decrease in affordability compared to the previous year have posed challenges for prospective purchasers.
The strongest demand persisted for high-priced single-family houses and condominiums, both well over the threshold indicating a High degree of buyer interest. The month's supply for each kind of property changed relatively little from one month to the next, ranging from 0.8 months for mid-priced single-family homes to 1.7 months for luxury condos.
Baltimore Housing Demand & Prices
- The Bright MLS | T3 Home Demand Index reported a 127 (“Moderate”) index, which rose 4.1% from March 2022.
- However, demand was -17.5% lower than last April's unprecedented market.
- The median sales price reached $360,000, a 9.1% increase over April 2021 (a gain of $30,000).
- Across the region, the fastest price growth was in Baltimore County, where the median price rose 14.0% compared to a year ago.
- Condominium prices in the Baltimore area increased the quickest.
- The median condo price in April 2022 was 14.8% more than in April 2021
- The median prices of single-family detached homes and townhomes increased by 5.7% and 7.6%, respectively.
- The median number of days on the market was the same in April as it was a year ago and last month.
- In April, the median number of days a home was on the market in Harford County was four.
Baltimore Closed Sales & Inventory
- According to Bright MLS, units sold declined by 3.4% % compared to a year ago.
- The number of home sales in the Baltimore metro area has declined year-over-year for five consecutive months.
- Sales were up between March and April; however, the month-to-month increase was lower than it is during typical years.
- With the exception of Howard County (+6.9%), Carroll County (+2.8%), and the City of Baltimore (+0.7%), most local markets in the Baltimore region had a decline in sales activity in April compared to the previous year.
- Condo sales grew year-over-year in the region, although sales of single-family detached houses and townhomes decreased.
- The number of pending sales in the Baltimore region decreased by 11.7% compared to the previous year.
- This is the eleventh consecutive month that new pending sales have decreased in the region, suggesting a slowdown compared to last year's frenetic pace.
- The number of new listings fell by 11.3% in the Baltimore region, which is 651 fewer listings than during April 2021.
- Inventory in the Baltimore region fell again in April, but the year-over-year decline was modest (-1.4%, or 46 fewer active listings).
- The month's supply ranged from 1.1 months for mid-priced single-family homes to 2.6 months for higher-priced condos.
- Supply in the region has been declining since the middle of 2019; however, there are signs that inventory may be starting to stabilize in the region
Baltimore Real Estate Market Forecast 2022-2023
What are the Baltimore real estate market predictions for 2022 to 2023? Let us look at the price trends recorded by Zillow over the past few years. It has a track record of being one of the best long-term real estate investments in the U.S. Since the last decade (June 2012), the typical home value in Baltimore County has appreciated by around 46% (Zillow Home Value Index). Baltimore home values have gone up 10.7 percent over the past year alone. The typical value of homes in Baltimore County is currently $330,136.
It indicates that 50 percent of all housing stock in the area is worth more than $330,136 and 50 percent is worth less (adjusting for seasonal fluctuations). ZHVI represents the whole housing stock and not just the homes that list or sell in a given month. The supply is exceeding the demand, giving purchasers an advantage over sellers in price negotiations. In other words, there are more homes for sale than there are buyers in the marketplace. Baltimore is a seller's real estate market.
- The typical home value of homes in Baltimore-Columbia-Towson Metro is $374,947.
- Baltimore-Columbia-Towson Metro home values have gone up 11.1% over the past year.
- Zillow predicts they will rise 6.7% by April 2023.
- The typical value of homes in Baltimore County is $330,136, up 10.7% over the past year.
- Baltimore City is even more affordable with a typical home value being $206,120, up 13.8% over the past year and will continue to rise over the next twelve months.
Here is the Baltimore-area real estate price appreciation graph by Zillow since 2012.
Baltimore Real Estate Investment: Should You Invest in Baltimore?
Now that you know where Baltimore is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Is Baltimore a Good Place For Real Estate Investment? Many real estate investors have asked themselves if buying a property in Baltimore is a good investment? You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers in 2022.
Baltimore looms large in American history. First settled in the 1600s, it was one of the largest cities in the U.S. in the colonial era. Today, it is often thought of as a distant suburb of Washington D.C., an industrial city on the decline. Yet this city is experiencing a turnaround that presents a unique opportunity for real estate investors. The Baltimore real estate market offers a variety of properties for buyers who are looking for a place to call home.
Baltimore is home to around 600,000 people. At first, the Baltimore housing market would seem like a bad investment since the city saw a nearly 5% drop in population from 2000 to 2010. This is a continuation of a decades-long flight from the city; between 1970 and 2000, the total population declined by almost a third. However, there is a significant opportunity in the Baltimore real estate market for investors, and not just because the metropolitan area is home to nearly three million people.
If you are looking to make a profit, you don’t want to buy the most expensive property in the Baltimore real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Baltimore that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.
According to Neighborhoodscout.com, a real estate data provider, three and four-bedroom row houses are the most common housing units in Baltimore. Other types of housing that are prevalent in Baltimore include large apartment complexes, duplexes, single-family detached homes, and homes converted to apartments. Baltimore has a mixture of owners and renters, with 45.50% owning and 54.50% renting. Let’s take a look at the number of positive things going on in the Baltimore real estate market which can help investors who are keen to buy an investment property in this city.
The Student Market
If you want to invest in the Baltimore real estate market aimed at students, Baltimore is a rich target. The University of Maryland and John Hopkins University are two large pools of students in the Baltimore area, but they aren’t the only ones. Coppin State University is home to around 4000 students, while Morgan State University houses six thousand. The University of Baltimore has five thousand students enrolled, though this college is sometimes confused with the University of Maryland Baltimore campus of similar size. Johns Hopkins has around 20,000. If you’re more interested in the metro Baltimore real estate market, Towson University is also home to around 20,000 students.
The Baltimore housing market for students extends well past the neighborhoods immediately around big schools like Notre Dame of Maryland (5000 students) and Loyola (6000 students). You could buy rental properties around the Maryland Institute College of Art, Goucher College, or Sojourner-Douglass College. Note that the Baltimore housing market near Johns Hopkins also profits from the hospital of the same name, since that is one of the largest employers in the city.
A Huge Population of Working-Class Renters
Nationwide, around a third of the population rents. In Baltimore, just over 40% do. Baltimore stands out for its walkability and public transportation network. This helps explain why around two-fifths of those who rent don’t own a car, so properties in the Baltimore real estate market close to public transit command a premium. Interestingly, one in eight homeowners in Baltimore doesn’t own a vehicle, so they bid up the price of homes near bus and train stops, too. Given the largely working-class population in the city, many of these renters cannot afford homes selling for around $160 a square foot, so they’re guaranteed to rent for the long term. Given the relatively low cost of properties in Baltimore, this creates a surprisingly good return on investment for investors in the Baltimore housing market.
As of June 13, 2022, the average rent for a 1-bedroom apartment in Baltimore, MD is currently $1,299. This is a 20% decrease compared to the previous year. Over the past month, the average rent for a studio apartment in Baltimore decreased by -1% to $1,126. The average rent for a 1-bedroom apartment decreased by -7% to $1,299, and the average rent for a 2-bedroom apartment decreased by -3% to $1,550.
- The average rent for a 2-bedroom apartment in Baltimore, MD is currently $1,550, a 14% decrease compared to the previous year.
- The average rent for a 3-bedroom apartment in Baltimore, MD is currently $1,700, a 10% increase compared to the previous year.
- The average rent for a 4-bedroom apartment in Baltimore, MD is currently $2,200, a 42% increase compared to the previous year.
Baltimore’s Foreclosure Bounty
Foreclosure has made the news repeatedly for foreclosure abuse and extreme cases that led to the loss of homes. The rules result in people periodically losing their homes due to hundreds of unpaid utility bills. (A $350 water bill can be enough to start the process with the water authority. Baltimore also has a low threshold for foreclosing on properties for delinquent property taxes; the city can have a tax sale due to unpaid tax bills. In Baltimore City, a house may be placed in a tax sale if you are delinquent on $750 in property taxes (or other municipal liens, including water bills).
In other counties, a homeowner has their home placed in a tax sale for as little as $250 in delinquent property taxes. This means there is an unusually large number of significantly discounted foreclosures in the Baltimore real estate market. Furthermore, the low thresholds result in reasonably well-kept homes hitting the Baltimore housing market via foreclosure sales after an unexpected budget crisis, not years of neglect by homeowners.
Limited Housing Inventory Causing Steady Appreciation
For those who want to buy a home, the market cannot meet demand. The Baltimore metro area has a low inventory of quality single-family homes relative to demand. This is why the median sales price in January 2022 was $318K, an increase of 6% from the previous year. January 2022 was the 3rd month with less than a one-month supply of homes and the fourth month where levels fell by -20% or more from a year ago. The constricted inventory kept sellers in the driver’s seat, with units typically going for the full asking price.
Sales volume was down 10 percent year over year, but active listings were down to a nineteen-year low, reflecting the ongoing need for housing in the metro. It is a symptom of declining inventories and a faster turnaround. The median days on the market figure rose seasonally up +1 day from a year ago. While days on the market continued to tick up month-to-month, homes are still moving quickly relative to prior Januarys over the past five years. This limited inventory relative to high demand will keep home prices growing for the foreseeable future.
Affordable Entry for Investors
After setting aside the possibility of snapping up homes by buying tax and utility liens, the Baltimore area remains an affordable metro area to invest in. There is a significant price variation. For example, homes in Baltimore City have a median sale price of around $225,000. At the other end of the market, the most expensive suburb of Baltimore, Howard County, had a median home sell for roughly $482K in June 2021. This means you can buy luxury homes in Baltimore’s suburbs that cost less than a fixer-upper in many hot markets.
The Job Hotspots
Amazon has set up several fulfillment centers in Baltimore. They’re taking advantage of Baltimore’s harbor, cheap real estate, and transportation links to the rest of the Northeast. Every one of these centers provides more than a thousand jobs, and the Baltimore housing market in their vicinity becomes hot because people move to where there is work. The Baltimore real estate market around the new industrial parks built to cater to Amazon will boom because we can expect as many jobs from Amazon’s suppliers in those areas as Amazon itself – and those workers will want to live close to work.
Pockets of Revitalization
Eighteen different neighborhoods in Baltimore were identified for renewal. East Baltimore in particular has been targeted for revitalization, and the money is already flowing in for projects. New infrastructure built by the city includes enhanced bus stops, dedicated bus lanes, rail improvements, and road improvements. They’re also tearing down old abandoned industrial buildings to open up large construction sites and giving tax breaks for new construction.
Investing in Baltimore real estate can be a worthy investment due to a steady rate of appreciation. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. Should you consider Baltimore real estate investment? The Baltimore real estate market has been in decline for years, but several spots offer significant returns. And there are signs that the city is starting to turn around. Good cash flow from Baltimore investment properties means the investment is, needless to say, profitable.
On the other hand, a bad cash flow means you won’t have money on hand to repay your debt. Therefore, finding a good Baltimore real estate investment opportunity would be key to your success. If you invest wisely in Baltimore real estate, you could secure your future. The best investment is now looking for a rental property that will generate good cash flow. Your best tenants would be the retirees who intend to relocate to Baltimore and want to purchase property to rent out. The running costs for owning and managing a Baltimore rental property should not be high.
While hiring a property management company you should expect to give up roughly ten percent of the rent for each property they manage. Remember to factor this loss into your calculations when budgeting for a new rental property. The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Baltimore investment property and you should be able to get a good return on your investment over the long term.
The neighborhoods in Baltimore must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Baltimore might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio. It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals such as duplexes and triplexes in Class A neighborhoods. The inventory is low, but opportunities are there.
Some of the popular neighborhoods in Baltimore are Guilford, Riverside, Mount Vernon, Fells Point, Federal Hill-Montgomery, Brooklyn, Canton, Inner Harbor, Charles Village, Belair-Edison, Bolton Hill, Roland Park, Remington, Homeland, and Locust Point.
Even as Baltimore's home prices have reached new heights, they are still near to the national average, and the market remains attractive to residential real estate investors. As they continue to compete for potential investment properties at the lower end of the market, the challenges for first-time homebuyers will remain. Millennial homebuyers can’t outbid real estate investors and hence end up renting. As with any real estate purchase, act wisely. Evaluate the specifics of the Baltimore housing market at the time you intend to purchase.
Hiring a local property management company can help in finding tenants for your investment property in Baltimore. If it is your first time investing in Baltimore real estate, then you would have to be aware of common beginner’s mistakes. Beginners would usually follow the media, buy a property, and wait for its value to increase. This could be risky. Real estate investing requires research. We recommend doing your research or hiring a real estate investment specialist for guidance.
For most investors, buying or selling real estate is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.
NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Baltimore.
Consult with one of the investment counselors who can help build you a custom portfolio of Baltimore turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Baltimore.
Not just limited to Baltimore or Maryland but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Baltimore turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.
Maryland is bounded on its north by the state of Pennsylvania. Philadelphia is the largest city in Pennsylvania and the second largest on the East Coast. It is the sixth biggest city in the United States. The Philadelphia real estate market offers an ideal mix of affordable properties you can snap up and a large population of renters who aren’t going to buy homes any time soon. You won’t face the same hostility as a landlord as you might in New Jersey or New York, whether renting to long-term tenants or tourists.
Another hot real estate where you can invest for the long term is Harrisburg, PA. Baltimore is connected to Harrisburg through the BALTIMORE-HARRISBURG EXPRESSWAY. The expressway functions as an important commuter route between the Baltimore Beltway and the Cockeysville-Hunt Valley area and has aided commercial and industrial development along this corridor. Harrisburg has a more favorable legal and tax climate, and it is stable. That makes it a good choice for real estate investors as long as you are investing in rental income instead of massive capital gains. And you could still earn a lot of money with fix-and-flip in the Harrisburg housing market.
In the same state, you'd find the city of Pittsburgh, which is home to approximately 90 diverse and eclectic neighborhoods and many of them offer convenient access to downtown and urban amenities. The overall stability of Pittsburgh’s economic outlook has contributed significantly to the gains seen in the real estate market. Pittsburgh is seeing an incredible renaissance, unlike many other Rust Belt cities. It is attracting new residents, redeveloping its downtown. And it is an excellent place to invest in real estate while it is still in the early stages of its rebound.
Let us know which real estate markets you consider best for real estate investing!
Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
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