Home Selling in Ocean City>Question Details

Al, Home Seller in OC Maryland

With the high inventory reported on condos in OC. Will prices continue to drop through summer?

Asked by Al, OC Maryland Fri May 18, 2007

Seems like it's getting harder to rent out condo in OC. Will prices start to drop as inventory rises? Is a threat of a bubble nearing?

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I'm afraid it has nothing to do with bubbles and rising inventories. It's getting harder to rent out any properties in OC because most folks don't make enough money, unless you get 2 or 3 families in 1 place, to make the exorbitant rents. I'm not trying to be a smart aleck, but that's the sad fact. It's also why the Inland Empire is exploding.
3 votes Thank Flag Link Fri May 18, 2007
There are a great number of anxious sellers in Ocean City.

The best answer will be on an individual basis. Some owners have had their properties for years and owe little to nothing on them and others are recent owners with large debt and mortgage payments and may need to sell quickly. And as more short sales and foreclosures enter the market, it will bring more opportunity for buyers to buy at great prices.

Staying in contact with an agent of choice to make sure you are constantly aware of the market is best. This way you won't miss out on the great buys that come along and sell quickly.
Web Reference: http://Rhondafrick.com
0 votes Thank Flag Link Thu Apr 15, 2010
Yes, I have to agree with Lisa. It's great to be optimistic, but judging from activity in San Diego (early June) the only pick up in activity has been lender owned sales. I understand that in Riverside County in March, REO's made up 56% of all sales!

Personally, for So. California, I think the bottom will come in 2010. I hope I'm wrong!
0 votes Thank Flag Link Wed Jun 4, 2008
I too am interested in learning more about the pricing of Condos in Ocean City, Md. I am a novice looking to purchase a condo in OC. I apologize if i've jumped onto your question inappropriately but I have a question based on two answers you recieved. I didn't think the California market had much bearing on Maryland. Am I wrong? I was trying to learn all I could about housing prices in Ocean City Maryland but never took into consideration anything that was happening in the West Coast markets? Am I short sighting myself here?
0 votes Thank Flag Link Tue Jun 3, 2008
Our typical volume of Inventory is 1,100 units, what we refer to as a "normal market". We should approach that number by July, as rental condos, currently listed for sale, are taken off the market for the season. Our prices are adjusted based upon competitive inventory. It is doubtful you will see significant price reductions throughout the summer: Owners are generating income, others enjoying their beach homes. You will see an increase in inventory by late September. Watch the interest rates!
0 votes Thank Flag Link Wed May 21, 2008
Our rental department foresees a decent year in 2008. However, as has been the case the past couple years, many renters are waiting until closer to their desired date to rent, hoping to get a better price. They may get a better price, but the better selection of properties will not be there. Another factor in a possible downturn in rentals is tied to the rising cost of gas.
As the inventory rose in OC since the fall of 2005, we have seen sale prices declining. I projected in my annual market analysis for Ocean City condos in 2007 that before we see the bottom of the market as it adjusts back to a more traditional, single digit annual appreciation, the sales prices will reflect 2003 more than 2005 which was the peak of the market in OC. Currently, inventories have seemed to stabilize a bit indicating that the worst is behind us. If you purchased your condo prior to 2003, you should have some decent equity built in to protect you from realizing a loss if you decide to sell. Price the property at or slightly below its current market value and you should be able to sell it.
0 votes Thank Flag Link Wed Apr 23, 2008
If the San Diego market is any indication, I would say it's a sure bet!

I found a great real estate blog that really tells it like it is for San Diego. If interested, visit:
http://www.brokerforyou.com/brokerforyou
0 votes Thank Flag Link Mon Jul 2, 2007
One More Thing!
What this means to you is...if renters can buy cheaper than rent, they'll buy. If there was a lot of "speculation" purchases, then buyers who bought expecting to "flip" are now stuck trying to rent.

I don't know why you are renting ( instead of selling), however when a market shifts, you may have to endure some negative cash flow in order to reap long term gains.

The Millionaire Real Estate Invester (best sellers on NY Times list), suggests a long term strategy. ..so if you've owned the condo for a short while, you'll get some great tax benefits.

Keith
0 votes Thank Flag Link Tue May 29, 2007
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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Al
I'd ask your REALTOR about the Absorption Rate. Let me explain:
If there were 500 condos on the market, and the sales during the most recent month were 100, it would require 5 months to "absorb" the inventory. The rule of thumb is that when the absorption rate is six months of inventory, that the market is balanced. The problem is that we've had a seller's market for so long in OC that Sellers and Buyers nad a hard time adjusting.

I think the short answer is that in Southern California, there are pockets that are doing well, and others not so well. Ask your REALTOR to provide you with an overview. If they are unable to do so, then ask him/her to find out. Usually a thorough CMA will help.

Good luck,
Keith
0 votes Thank Flag Link Tue May 29, 2007
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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