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Slower foreclosures lift March home sale prices

The median sales price for homes in the Baltimore metropolitan area increased over last year for the second straight month, according to a report released Tuesday, but the trend may not continue if foreclosure sales increase.

Of the 1,894 homes sold last month —1.7 percent more than in March 2011 — only 13.9 percent were foreclosed properties, compared to 30.8 percent of homes sold last March, the report from Rockville-based Metropolitan Regional Information Systems said.

“That’s why prices are up, there are fewer banks selling houses out of foreclosure,” said Deborah A. Ford, director of the real estate program at the University of Baltimore.

But Ford said the decrease in foreclosure sales is because of a moratorium on foreclosures that is coming to an end.

“They had a moratorium in foreclosures for a couple of years, and it takes a while after they foreclose before they can sell it,” Ford said. “They have started foreclosing again, but they won’t come on the market [for a few months].”

The level of new foreclosures for March was less than half of what it was last year, according to the report.

“Should the number of new foreclosures continue to decline and sales activity continue on its current pace, it can be expected that the median sales price will continue to appreciate in the second quarter,” the report said.

In March 2011, 7 percent of homes on the market were foreclosed properties, compared to only 3.3 percent this March, according to the report.

The median sale price for March 2012 was $215,000; a 7.5 percent increase over last year, the report said. And the median sales price in this year’s first quarter was $210,000, up 2.4 percent from the first quarter of 2011.

Townhomes saw the largest increase, with a median sale price of $160,000 in March, 15.7 percent more than last year, which Ford said is an indication that first-time home buyers are re-entering the market.

“People who are first-time home buyers who have been priced out of the market are coming back into the market and buying townhomes and other lower-priced houses,” Ford said.

There was also improvement in the time homes spent on the market, with half of the homes sold in March spending less than 88 days on the market, compared to the median of 103 days on the market in March 2011, the report said.

The city of Baltimore saw a 75 percent increase in median sale prices in March, to $91,000 from $52,000, the report said.

The number of homes for sale in March was 24.3 percent less than last year, and is the lowest level for March since 2006, the report said.

“There is a relatively healthy balance between supply and demand, with 12,189 active listings representing 6.6 months of supply,” the report said.