As we look ahead to 2024, the Maryland investment real estate market continues to present a lucrative opportunity for investors. With its proximity to Washington D.C. and a steady demand from government workers and military personnel, Maryland’s housing market remains resilient despite the challenges of the past year. In this article, we will explore the current trends and predictions for the Maryland investment real estate market in 2024, focusing on the importance of DSCR lenders and loan products such as the DSCR loan, Fix and Flip loan, and Hard Money loan in facilitating successful real estate investments.
Current State of the Maryland Housing Market
The housing market in Maryland has seen a steady rise in home prices, with an increase of about 2.5% per quarter. While the market experienced a slowdown due to the pandemic, the demand for housing remains strong, leading to limited inventory and quick sales. Homes are often snapped up by buyers within a week of listing, indicating the continued favorability of the Maryland housing market.
The Maryland housing market is made up of 23 counties and Baltimore City, with the greatest growth expected in the greater Baltimore area and suburbs of Washington D.C. According to a Maryland Housing Needs Assessment & 10-Year Strategic Plan, the state is projected to add 178,000 new households through 2030. This growth, coupled with the need for affordable housing and prioritization of low-income households, creates a favorable environment for real estate investors.
Maryland Housing Trends and Stats
Declining Inventory and Quick Sales
The Maryland housing market has experienced a significant decline in inventory, with fewer monthly listings compared to the previous year. As of July 2023, there were 6,491 new listings, down from 9,900 in the same period of the previous year. Additionally, the overall housing inventory in the state has decreased from 1.5 months to 1.4 months, indicating a tightening market.
Homes in Maryland have been selling quickly, with an average of only seven days on the market before a sale turns pending. Real estate website Zillow reports an even faster median listing-to-pending time of six days as of July 2023. This trend suggests a high demand for housing and limited supply, leading to competitive market conditions.
Rising Home Prices
Limited inventory and high demand have contributed to rising home prices in Maryland. The average sales price in the state has increased by 3.2% this year, reaching $486,385, according to Maryland Realtors. In certain areas like Baltimore, the median price has exceeded the city’s five-year average, with the Greater Baltimore Board of Realtors reporting a median price of $290,000 in July 2023. The strong demand has also resulted in sales above the listing price, with 53.2% of sales in June 2023 selling above list price, according to Zillow.
Certain counties in Maryland have experienced notable year-over-year growth in average prices. Dorchester County leads with a growth rate of 27.6%, followed by Worcester County at 8.7% and Allegany County at 8.6%. However, Kent County has seen a double-digit drop in prices, with an average decrease of 27.1% year-over-year. Montgomery County stands out as the county with the highest average sales price of $750,482, while Allegany County offers more affordable options with an average price of $163,256.
Fastest Growing Markets and Competitive Areas
Real estate brokerage firm Redfin has identified several cities in Maryland as the metros with the fastest-growing prices. Elkridge leads the pack with a growth rate of 28.8%, followed by Montgomery Village at 27.1%, Cambridge at 23.6%, Ilchester at 22.4%, and Annapolis at 21.8%. These cities offer promising opportunities for real estate investors seeking areas with strong price appreciation.
In terms of competitive markets, Perry Hall, Bel Air, and Bel Air North have been identified by Redfin as areas where buyers are most likely to pay above the list price. These markets indicate high demand and competition among buyers, making them attractive for investors looking for potential returns.
Maryland Housing Market Predictions for 2024
While the Maryland housing market has shown resilience and continued growth, experts have varied predictions for the coming years. It is important for investors to consider these forecasts and adjust their strategies accordingly.
Continued Growth in Home Prices
According to the National Association of Realtors (NAR) Chief Economist Lawrence Yun, home prices are expected to increase by around 3% to 4% in 2024. This projection aligns with the supply-demand dynamics in Maryland, where the supply of houses is likely to remain below a balanced market level. Chen Zhao, leading the economics team at Redfin, also anticipates a sustained shortage of housing in the coming years, contributing to the upward pressure on prices.
On the other hand, Moody’s Analytics and Morgan Stanley expect a slight decline in U.S. home prices in 2024. While these predictions suggest a potential slowdown, it is important to note that a major collapse in prices is unlikely. The strong demand, limited inventory, and favorable market conditions in Maryland are likely to support continued growth, albeit at a slower pace.
Importance of DSCR Lenders and Loan Products
To leverage funds effectively in the Maryland real estate market, investors can turn to DSCR lenders and loan products tailored to their needs. The Debt Service Coverage Ratio (DSCR) loan, Fix and Flip loan, and Hard Money loan are popular options for investors looking to finance their real estate investments.
DSCR Lender Maryland, specializes in providing loans based on the cash flow potential of the property rather than the borrower’s personal income or credit score. These lenders evaluate the property’s income-generating potential and calculate the DSCR to determine the loan amount. This allows investors to maximize their borrowing capacity and secure financing for their investment properties.
The Fix and Flip loan is designed for investors who purchase distressed properties, renovate them, and then sell them for a profit. This loan provides funds for the purchase and renovation costs, allowing investors to quickly turn around and sell the property for a higher price.
Similarly, the Hard Money loan offers short-term financing for real estate investments, particularly for properties that may not qualify for traditional bank loans due to their condition or other factors. Hard Money lenders focus on the value of the property rather than the borrower’s financial history, making it an attractive option for investors seeking quick access to funds.
By partnering with DSCR lenders and utilizing loan products such as the DSCR loan Maryland, Fix and Flip loan, and Hard Money loan, investors can navigate the Maryland real estate market with greater flexibility and potential for higher returns.
Conclusion: Seize the Opportunity in the Maryland Real Estate Market
As we look towards 2024, the Maryland investment real estate market offers a promising opportunity for investors. Despite the challenges of limited inventory and rising home prices, the strong demand for housing and favorable market conditions create an environment conducive to successful real estate investments.
By considering the predictions for the Maryland housing market, including the expected growth in home prices and the importance of DSCR lenders and loan products, investors can position themselves for success. Partnering with a reputable DSCR lender, such as the #1 DSCR Lender Maryland, and exploring loan products like the DSCR loan, Fix and Flip loan, and Hard Money loan, can provide the necessary financial support and flexibility to seize opportunities in the Maryland real estate market.
Investing in the Maryland real estate market will remain lucrative for years to come. With the right strategies, financing options, and market insights, investors can navigate the market with confidence and capitalize on the potential for growth and returns.
Additional Information: Investing in the Maryland Real Estate Market will remain lucrative for years to come. The two most popular loans to help investors leverage their funds in Maryland is to visit the #1 DSCR Loan Maryland and look at their loan products. The Fix and Flip Loan Maryland and the Hard Money Loan Maryland are also very popular. For more on these loan types visit a local lender like CambridgeHomeLoan.com or HardMoneyLoanLender.com for more information.