CHESTERTOWN — Anyone looking to buy a home in Kent County has probably figured out that if you see one you like, you have to move fast.
Not only has there been a spike in home sales over the past year, it has been a seller’s market with prices going up.
Earlier this month, the Kent County Chamber of Commerce hosted a discussion with local agents and brokers about the booming market here, looking at trends in prices and purchasers.
The chamber’s executive director, Sam Shoge, moderated the discussion held April 13 via the Zoom teleconferencing app.
“It is of course an extreme seller’s market here with regards to our residential real estate,” said Shoge as he led off the discussion featuring Cindy Genther of Rock Hall Properties, Chris McClary of Gunther McClary Real Estate, Julie Santoboni of Cross Street Realtors and Hugh Smith of Coldwell Banker Chesapeake.
Smith, a licensed broker since 1983, said he has never seen a dynamic this strong on the seller’s side, with extreme demand pressures. He said houses are receiving multiple bids and listings are going under contract within a day of coming on the market.
“It’s a great time to be in the real estate business, especially selling product as wonderfully located and as aesthetically pleasing as Kent County,” Smith said.
Genther said there has been a dramatic increase and “fever” in the residential market here.
Looking at the numbers, Genther said more than 300 homes were sold in 2019 — a first in more than a decade. She said that jumped to 433 in 2020 to the tune of $150 million in home sales that year.
In addition, she said prices increased 12%, with the average Kent County home sold in 2020 going for $332,000.
Santoboni said houses of all price points are getting snapped up here, from the lower end to the nearly $2 million homes.
McClary spoke about how it took Kent County a long time to recover from the economic crash in 2008 and 2009, creating a backlog of home inventory. He said the market picked up in 2016 and 2017 with more inventory coming on the market.
Then came the COVID-19 pandemic.
“When the pandemic hit, of course the first two months were pretty quiet. But then by the end of April there was just an explosion and all that inventory was totally consumed,” McClary said.
Santoboni said that no one expected such an explosion in the rural housing markets here. She said houses that had been sitting on the market started selling for a lot.
The panelists agreed that many of these homebuyers are coming from metropolitan areas: Washington, D.C.; Philadelphia, Pa. and its suburbs; and New Jersey.
McClary said buyers are starting to come from New York, too.
“I’ve been doing this 22 years, and I’ve showed more property to people from New York in the past 10 months than I have in my entire career,” McClary said. “So it’s really fascinating to see a whole new set of buyers coming from a different geographic area discover us.”
Smith said people want out of the city and can still work remotely. He said they are looking for quality of life.
He said that while some are following previous generations of family members to the Eastern Shore, others are completely new to the area.
“We’re seeing a whole new cadre of young people with kids who never would have moved to Kent or Talbot or Queen Anne’s County in the past. Which is fantastic, because for the vitality of the community, we really needed that,” Smith said.
Genther said these homebuyers are finding Kent County first as a vacation destination, having previous stayed here at a hotel or inn or in a short-term rental through an online service like Airbnb.
Upgrades to the U.S. Route 301 corridor that cut drive times to those northern metropolitan hubs and expanded internet access here also are helping drive the home market, the panelists agreed.
Santoboni also pointed to Amazon deliveries as a driver, saying the online retailer offsets the lack of big box shopping here.
Meanwhile, workforce housing and starter homes are becoming scarce.
“Anybody who aspires to homeownership has to be very quick. They have to be willing to get into a competitive situation. They have to be mentally prepared that they may not to get the first house they pursue,” Smith said.
Santoboni said not to expect new workforce housing to be built soon. She said the pandemic affected supply chains, leading to spikes in the cost of lumber and other materials.
“It’s hard to build affordable workforce housing when building materials are so expensive,” she said.
Santoboni predicts that when more people start putting homes on the market and inventory begins to build up, prices will start to settle.
Smith and McClary expect to see the real estate market here start to return to “more reasonable conditions,” as Smith put it, late this year or early next year.
Genther said factors like inflation and gas prices also will play a role in the market.
“I think the overall economic conditions in the country will drive where this goes and how long we’ll continue to see an increase. But I think the slowdown is coming and I see that coming in 2021,” she said.
Santoboni does not fear the creation of a real estate bubble, though, because it is still difficult for people to get loans and financing.
As for those potential sellers seeing dollar signs, the panelists have a warning on pricing homes for the market.
“The market is strong, but the market is not stupid,” Santoboni said. “Overpriced properties still do not sell.”