The Maryland Housing Market: Where Are Homes Selling The Fastest?
Rachel Burris6-minute read
July 22, 2021
In Maryland, supply is low, demand is high and bidding wars are the new normal. The extreme seller’s market that has been experienced throughout the state has created a frenzy among buyers who are desperate to get their hands on a new home.
If you’re buying a house in Maryland, it’s increasingly common for appraisals to come in well below purchase prices. As a result, home buyers have had to drop financing contingencies, have funds prepared to pay the difference at closing and, in many cases, be prepared to pay all-cash.
With competition fierce, buyers are closing on homes in record times. On average, in Maryland’s hottest housing markets, homes have been selling just 9.6 days after hitting the market. Take a look at the top 10 Maryland metro areas where homes are selling the fastest.
The Top 10 Hottest Housing Markets In Maryland
After analyzing Rocket Homes® listing data, we ranked the top 10 hottest housing markets in Maryland based on the average number of days homes spent on the market before going under contract in May 2021. We then interviewed a number of Berkshire Hathaway HomeService real estate agents working in the area to shed light on what they’re seeing on the ground.
1. Frederick, Maryland
Frederick ranks as Maryland’s hottest housing market thanks in part to its wealth of amenities, large historical district and beautiful parks. REALTOR® Donna Gibson has witnessed the inventory in Frederick decrease by 62.5% year-over-year. “As the inventory remains low at all price points, houses are moving to pending after only 6 days,” Gibson explains. “There is still stiff competition with each offer to the tune of 10 to 30 offers for a property.”
2. Columbia, Maryland
Columbia boasts a vibrant, suburban community that’s just a 30-minute drive from Baltimore and 45-minute drive from Washington, D.C. With an easy commute and strong public schools, Columbia buyers have been so eager to purchase property in the area that the average homes are selling in under 9 days and nearly 97% of listings are selling in under 30 days. Given the strong demand, sellers are balking at contingent offers – financing contingencies, in particular, are consistently being rejected.
3. Waldorf, Maryland
Homes in Waldorf are also flying off the market in an average of just under 9 days. The median sold price for homes in the area is 33.1% above the national average of $278,100. When comparing the current market to previous real estate trends in Waldorf, REALTOR® Debbie Friedrich says that she’s seen “lower inventory in a market that was already challenged with low inventory.” Listings have been difficult to come across, especially for buyers looking for homes below $300,000.
4. Germantown, Maryland
Germantown is a popular choice for individuals who want to maximize their housing budget but still be close to Washington, D.C. The city’s 90,000 residents can choose between condos, townhouses, and single-family homes. Yet, inventory in the area has been hovering around historic lows. There’s just 2.3 months’ supply of homes for sale, and 96.1% of properties are selling in under 30 days. Demand has been driving prices up to the point where a whopping 70.4% of properties are selling above ask.
5. Bowie, Maryland
In Bowie, the median sold price is $420,000, so buyers are paying 51% more for their homes than the average American. The overheated market has forced buyers to change their house-hunting tactics. To find homes that they can afford, REALTOR® Danny De Angelo has had to advise buyers to look for homes just below their price range. This strategy gives buyers room to bid up, which has become necessary, as bidding wars are inevitable in the current Bowie market.
6. Pasadena, Maryland
Located on Chesapeake Bay, Pasadena is a small suburb of Baltimore with a population of nearly 30,000. In Pasadena, 65.1% of homes are being purchased above ask and only 4.8% are selling below ask. In order to make offers more competitive, buyers have been forced to pay all cash and drop all contingencies. REALTOR® Sheena Kurian explains, “Many people have started to opt for new construction because they are tired of the bidding wars in the resale market.”
7. Glen Burnie, Maryland
Just west of Pasadena, Glen Burnie is another suburb of Baltimore. With just 2.4-month supply, the Glen Burnie inventory is struggling to meet the demand. “Purchasing sight unseen is common in this area and this market due to it being competitive and having a big military presence,” says Kurian. However, despite the abundance of frenzied buyers, it appears that the Glen Burnie supply is slowly starting to increase.
8. Ellicott City
Ellicott City’s status as one of Maryland’s hottest housing markets is not new. It is consistently ranked as a top suburb to live in. However, the competition for the city’s limited housing inventory has only gotten more intense. The median sold price for the area is $540,000, which is 94.2% above the national average. Yet, Ellicott City residents can afford it, given that they tend to make 109.3% more than the average American household.
Despite the overheated market, the median sold price in Parkville is actually 11% below the national average. REALTOR® Steve Wolff attributes the particularly cutthroat nature of Parkville’s housing market to a combination of low inventory, high construction costs and an abundance of homeowners who’ve decided to renovate their homes instead of trading them in. “It’s a hard time for buyers that don’t have extra cash to pay higher prices,” he says. “The clients with the ability to pay cash or add cash at the closing are the ones winning out bids.”
10. Owings Mills
In Owings Mills, prices have risen across all price points. The seller’s market is so extreme that home inspections are being accepted for informational purposes only, meaning sellers will not make repairs or deduct the respective costs from the purchase price. Buyers are agreeing to previously unthinkable terms and are still walking away empty-handed: “I had a client that went 60k above, waived inspections, guaranteed 10% over appraisal, offered to pay transfer taxes and still didn’t get it,” says REALTOR® Dave Fazenbaker.
How To Score A Home In The Maryland Housing Market
House hunting in such a hot market can be extremely disheartening, which is why it’s crucial to be prepared to face a bidding war. Paying all-cash and dropping contingencies is extremely useful in a seller’s market; however, most buyers don’t have that luxury.
For Maryland home buyers who require a mortgage, Kurian suggests, “If you are qualified for $500k, start looking at $400k, so you have some wiggle room. If you don’t want to deal with competitive offers, look for homes that have been sitting on the market for at least 2 weeks."
Kurian also warns buyers to keep their emotions at bay. Anyone trying to purchase a home in this market likely will lose out on at least one home. Letting your emotions get in the way of your decision making will not only cause you heartache but also lead you to offer far more for homes than they’re actually worth.
What To Consider When Selling A Home In Maryland’s Red-Hot Market
For Maryland sellers, who may be interested in taking advantage of this overheated housing market, it’s crucial to keep in mind that you may be able to get top dollar for your home but finding a new property in this market is going to be a considerable challenge. Wolff recommends, “List it now and if you can work out a rent-back [agreement] or place to live without buying, do it. Get to know your new area before you buy and maybe the market will stabilize more.”
To find the top 10 hottest housing markets in Maryland, we pulled all Rocket Homes® listing data for May 2021. We limited the study to the Maryland metro areas where there had been at least 80 homes sold over the course of the month and ranked the remaining places by average days on market.
To provide readers with a clearer picture of these Maryland housing markets, we also sourced data on median household income and 2019 population estimates from the U.S. Census Bureau and the U.S. median home price from the Federal Housing Finance Agency (FHFA).
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