Hot Maryland Market - Sell or Hold? - Posted by HT

Posted by Killer Joe on May 23, 2005 at 11:19:51:

Hi HT,

“I was considering selling shortly, as forecast implied that the prices in the market had (or would soon) reached their max.”

Don’t forget that prior to hitting that point the DOM for houses will climb as home sales lose their velocity. A projection of 40 days to sell based on todays sales could grow to 140 days at that point, and really screw up your plans.

Watch for signs that things are changing. This is most notable when you see “Just Reduced” in multiple RE ads coupled with a growing DOM average.

Once the herd gets wind of the change, the inventory skyrockets, and prices can drop 10% overnight. Stay ahead of the curve. Cash in hand now can mean great opportunities when it changes from a sellers market to a buyers market. It’s coming, to what degree and how soon is anybodys guess. You’ll know the winners by the smiles on their faces as the rest of the herd is buying TUMS instead of RE.

Those of us who are positioning ourselves for the inevitable, will be glad we paid attention through the last cycle changes.

HTH

KJ

Hot Maryland Market - Sell or Hold? - Posted by HT

Posted by HT on May 23, 2005 at 06:42:02:

I’m looking for feedback on whether I should sell a property I own or hold and await completion of a new shopping center.

Presently, I own a property in one of the hottest markets in Maryland (property is in Bowie/GlenDale in PG County) and I was considering selling shortly, as forecast implied that the prices in the market had (or would soon) reached their max.

This area is composed of three sets of large homes:

  1. Older homes (built in the late 70’s - 80’s) - valued in the high 300K’s
  2. Newer homes (built in the 90’s) - valued in the mid-to-high 500K’s
  3. Brand new homes (built in the last 1-2 years and currently in development) - valued in the 600K-800K range

While this area has beautiful home communities, there is no strong retail presence in the immediate vicinity, so you must drive 3-5 miles in any direction to reach a mall with stores of a nationwide presence. I now have knowledge that a shopping center is being developed (construction has already begun) less than 1/4 mile (literally 2 minutes) away from my property, that will include national chains, Target and Michael’s Arts & Crafts.

I own one of the older homes (with a huge backyard) and I will DEFINITELY be selling between now and late next summer (2006). Would it be smart to hold on to the property until next summer under the assumption that the new shopping center presence will give me another 5-15% in property value or should I get out now while the market is hot and before more newer homes are developed?

Thanks in advance for any/all feedback.