Maryland

Battered by a housing market that’s tanked due to increasing foreclosures, the Maryland economy is weakening as a result of fallout from the mortgage melt down. As one of the nation’s most affluent states, Maryland is taking a hard hit in the housing crisis.

Maryland saw the first decline in employment in years last year as employers made cut backs to weather a slowing economy. Foreclosures have increased at alarming rates due to both new creative adjustable rate mortgages resetting and subprime loans going bad.

Coupled with increasing foreclosures are new additional state taxes, which went into effect the beginning of the new year.

In Baltimore the housing market is ripe for falling real estate prices at rapid rates of deflation through 2008. Home sales have been lackluster and are forecast to remain that way with deflation of 12.6% on the average Baltimore residence through the year’s end, according to the Housing Predictor forecast.

City	Forecast
Baltimore	− 12.6%
Prince George's County	− 13.4%
Bethesda	−   8.7%
Silver Springs	−   7.9%
Columbia	−   7.2%

In cities and towns of Prince George’s County the construction boom lured many home buyers with affrodable housing. Middle class home buyers flocked to the area fueling a booming real estate market outside of Washington, D.C. But what once was a booming real estate market has turned into one of the nation’s worst busts. Foreclosures are increasing at what may be the fastest pace in the country.

Property sales are nearly non-existent except in the foreclosure market, and are forecast to send Prince George’s 13.4% lower in average housing prices by the end of the year. A glut of inventory sits on the market.

The real estate market in Bethesda isn’t feeling that sort of pain, but sales are slow and will slumber through 2008 at a slower pace again. Like in most of Maryland, home prices hit new record highs in Bethesda topping $1-million in the boom. But housing values are forecast to depreciate 8.7% this year.

Outside of Bethesda, Silver Springs housing market was bustling during the boom, and this town which caters to tourists has seen its real estate market slow like the rest of Maryland with increasing foreclosures. The tourists still come to enjoy the downtown, where the Discovery Channel makes its headquarters.

But not many buyers are looking for homes in Silver Springs these days, which is forecast to have a slow sales pace for the year on 7.9% deflation.

Columbia is midway between Baltimore and Washington, DC. and is the second most populated city in the state. It was originally designed as one of the nation’s foremost neighborhood developments catering to commuters, who wanted a better quality of life outside of the big city.

The community has grown and thrived since the late 1960's. Home sales are slow, but not off as much as other areas of the state with forecast modest depreciation in average home values of 7.2% by year’s end.