Brace for a Slowdown, Not a Meltdown, in Housing Prices
In affluent Montgomery County, Md., near Washington, the market is still perky, says Meg Finn, a Long & Foster agent. She's expecting a bit of a slowdown in 2006: "Maybe not as crazy as last year, but that would be OK," she says. Right now, the only signs Finn sees of a cooling housing market are at the lower end. The average price of homes sold by her office is nearly $600,000, says Finn. "I'd like to see a house take a week to sell instead of three days so people could catch their breath and maybe even get a home inspection," she says.
Status quo. Prices in many markets between the coasts never rose that quickly, so the chances of a bust there are minimal. In Hamilton County, Ind., just north of Indianapolis, home sales are strong and should remain so through the year, says Deb Castino, a real-estate agent with F.C. Tucker Co. in Noblesville. Her office had a record 2005, but that meant sales were just 2 percent better than in 2004. "It was never like California, where you put a sign in the yard and get six offers in 10 minutes," says Castino. Homes in Hamilton have been selling right around list price--the average is about $250,000--and have been staying on the market 70 days or so on average. Castino and her colleagues dismiss all the talk they hear from the coasts about a real-estate bubble bursting. "We expect about the status quo this year," she says.
Castino is seeing some buyers come to the area from other parts of the country where homes are much more expensive, such as Arizona and Florida. They're attracted to Hamilton County for the good schools and the fact that they can get a lot more for their money, she says.
For those selling their house and buying another, NAR economist Lereah says moving to a place like Hamilton is probably the only real way to cash in on the transformation of a seller's to a buyer's market. For people staying in the same market, he says, it will be a wash.
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