Recent auctions for a number of large homes and properties on the Eastern Shore seem to be pointing to a new price reality for the real estate market. Over the last several months, some of the region’s most prestigious large homes or landmark sites have seen selling prices drop almost 50% less from 2006 values.
Examples include $2,690,000 paid for Great Oak Manor, the $1,650,000 paid for the Marshall property near Centreville, $1,485,000 paid for Riverside Farm in Talbot County, and the recent $2,300,000 bid for Hunters Oak Golf Club in Queenstown. This new shift is also supported by more traditional private sales.
Long time realtor Hugh Smith of Coldwell Banker senses the the “reset” theory is now a reality. “There is a fundamental reset of values going on that is still escaping many in the industry and among eastern shore landowners,” said Smith. “Many people wrongly believe this is a cycle which will reverse course in coming days, but you can’t ignore these recent purchases. Prices will start stabilize 2012 so we can begin the long road of recovery.”
Joe Hickman, co-owner of Cross Street Realtors, sees this pattern as a sign for all property owners on the Shore. “Due to the high profile nature of some of the recent auctions, and the publicity they received in the general media, they serve to make all property owners reassess the value of their assets.”
Since the recession of 2008, there has been an ongoing debate within the real estate industry on if prices will eventually return to historic highs or a major “reset” of the market is taking place.
Dan DeCaro of DeCaro Auction in Easton tends to agree. “Certainly we’ve seen a reset of market value on continuing devaluation of real estate,” DeCaro said. “But what I do see is the start of stabilization. There is now some appetite to look at real estate. We might have overcorrected, things might have gone further than they should have.”
A early test for this shift will be in April as the real estate market traditionally starts to swing into high gear.
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