ANNAPOLIS – Despite a cooling housing market in the state, the Maryland Association of Realtors Tuesday launched a lobbying group that plans to advocate for lower home prices.
The organization, called the League of Maryland Homeowners, hopes to lobby policy-makers and Gov.-elect Martin O’Malley for “initiatives encouraging home ownership,” said Ilene Kessler, president of the Maryland Association of Realtors, a trade organization of Realtors in the state.
Despite its name, the League of Maryland Homeowners’ 34,000 members are almost all Realtors, though Kessler said she hopes to recruit more homeowners.
“We want to mobilize the large number of Marylanders who tell us they worry that their children and other people they love will not be able to afford a home in their community,” Kessler said in a conference call with reporters.
The group plans to push for tax credits for first-time homebuyers and employers that donate money to non-profit organizations that help build homes.
The move comes at a time when home prices are falling nationwide and growing more slowly in the state. At the same time, a new administration is preparing to take control of the state government in Annapolis.
Rick Abbruzzese, a spokesman for the governor-elect, said O’Malley hopes to create a trust fund for housing development projects that would benefit low-income families. The specifics of that plan, however, have not yet been hashed out.
“Certainly, an issue that we talked about a lot during the campaign was affordable housing for working-class families,” Abbruzzese said. “But the particulars of that have not yet been determined.”
Kessler said the lobbying group is necessary because there is a “gap” between what the average buyer can afford to pay for a home and the actual price of homes on the market. Even though price increases on Maryland homes have slowed down, many low- and medium-income people still can’t afford to buy homes, she said.
In October, median home prices in the U.S. fell 3.5 percent year-over-year – the biggest drop on record – according to the National Association of Realtors. In Maryland this summer, home sales fell at least 20 percent in every jurisdiction, according to Regional Information Systems Inc., which tracks housing trends in the Washington area.
As a result, home prices in the state have grown at a slower rate, according to the Maryland Association of Realtors. For instance, in October 2005, the price of an average home rose 15.9 percent from a year earlier. This October, the price of an average home rose only 4 percent.
But the slow-down is just a return to a normal rate of growth after prices rose unusually quickly for the past five years, Kessler said.
“Some say the (housing) bubble is bursting, but the market is just adjusting,” she said.
Many first-time buyers still don’t have the income necessary to buy a home, Kessler said. On top of that, housing may become more expensive as Maryland’s population grows because there will be more demand for homes, she said.
Even though higher priced houses mean larger commissions for real estate agents, Kessler said realtors have an incentive to advocate for lower home prices because when houses cost too much, there are too few first-time buyers.
“Realtors by nature want to get people in homes,” she said. The Maryland Association of Realtors already has a lobbyist in Annapolis, Kessler said, and leaders of the new organization have not yet determined what tactics the members will use to lobby government officials.