The Baltimore housing market declined by 30% in May 2008 due to credit crunch, rising food and fuel prices, and tough lending conditions.
The Metropolitan Regional Systems Inc. (MRIS) said that the housing market of Baltimore plunged by 30% in May 2008 as compared to the corresponding month last year, as reported by bizjournals.
MRIS disclosed that a total of 2,109 homes were sold in May 2008 in the Baltimore region, comprising Baltimore City, Harford, Anne Arundel, Howard and Baltimore counties, against 3,030 homes in the same month in 2007. Besides, Baltimore saw one percent fall to $ 270,000 in the median house sale prices in May 2008 against May 2007.
The downfall in the Baltimore housing market is mainly accredited to credit crunch currently troubling the entire country. As a result, people are facing difficulties of earning their livelihood and unemployment and are finding home purchase extremely hard despite declining prices.
Another reason for fall in the Baltimore housing market is high pressure from skyrocketing fuel and food prices. This has put an extra burden on people’s pockets, as they have to expend more on essential commodities such as food and pay more for traveling.
Besides, the Baltimore housing market is facing a critical problem of slack lending standards. Consequently, the high ends of the local housing industry come across strong pressure on various fronts such as jumbo home loans. Mortgage housing loans are hard to access though measures are being taken to make them accessible.
In addition, new buyers in Baltimore are finding repayment conditions exceptionally hard, pushing the housing market further down in Baltimore. Furthermore, the high-end buyers prefer to take houses on rent instead of buying new homes to avoid difficulties arising from poor financial conditions. Consequently, the sales of new homes slipped down in May 2008 in the Baltimore region.
According to a Research Analyst at RNCOS, “The Baltimore housing market is falling primarily due to credit crunch and tough lending conditions. Now the realtors in the region have to come forward with flexible repayment options and loan facility to attract the customers and to revive the housing market conditions.”
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