Delaware Housing Market: Picking Up
As in most parts of the country, the Delaware housing market has slowed down substantially in the last year, according to local realtors, but that doesn’t mean it’s going to stay that way.
“Depending on who you talk to or what paper you read, some people say we’re in for this for another year, some say five,” said Rick Allamong, mortgage broker and branch vice president for Coldwell Banker in Bethany Beach. “I’d agree we have about another year.”
Many realtors are saying business has picked up this summer, which is encouraging - but not necessarily indicative of a return to an overall healthy market.
“Starting in July, we’ve noticed an increase in buyer calls and appointments in respect to looking at properties,” Allamong said. “Based on what I’m seeing, it’s about the same as what we saw last year.”
“The market has slowed dramatically from the pace we experienced two years ago,” added Rick Meehan, a realtor for Coldwell Banker and the mayor of Ocean City. “But there has been increased activity in August, though, and hopefully that is a good sign.”
Meehan, like most local realtors, says Americans are experiencing a buyer’s market. There’s a slew of attractive properties to choose from and the sellers are willing to negotiate.
“There’s never been a better time to buy,” said Kathy Panco, another Coldwell Banker realtor. “Concessions are being made to make the transaction happen.”
It might be a buyer’s market, but that doesn’t mean that potential home mortgage loan borrowers are actually purchasing homes. There are currently 5,461 units on the market in Sussex County and 2,000 in Ocean City.
“I think the jury is still out on what’s going to happen there,” he said. “But we have a two-year supply of inventory and only about 30 percent of that will sell between now and next summer.”
In an attempt to increase sales, developers are offering incentives, such as those at the Bella Vista Condominiums on 46th Street. At the condos, which offer use of a bay-front pool and cabana area, prices have been reduced by $70,000 and buyers will get a $5,000 furniture credit at Bethany Resort Furnishings.
However, sales are still slow. Panco says that one change she’s seen recently is that buyers are more educated.
In addition, many real estate agents say that vacation areas are usually the first to be hit by slowing sales, because they are not primary housing markets.
“Resort areas are usually hit first,” said Ted Smith, a realtor for Holiday Real Estate. “People don’t have to buy vacation homes.”
Meehan, however, says that Ocean City has an advantage over other second home markets.“Ocean City has an advantage because of its location and because people want to be here,” he said. “And I think baby boomers are going to be purchasing in Ocean City in the near future because of where we are and the product we offer.”
Meehan pointed out that the real estate market has gone through cycles before.
“Those familiar with the cycles realize that the market will come back up,” he said. “We don’t have a crystal ball, we can only look at past trends, but those show that the market fluctuates.”