Property values drop in O.C.

A trip to the beach is a ritual for some area families. A number of beach properties are owned by people who live in the D.C. metro area.

So how are property values at the beach doing?

WTOP follows the housing trends at beaches where locals vacation and own property in this special series.

OCEAN CITY, Md. – They say “life’s a beach.” But tell that to all those beach front property owners who’ve watched their values sink.

Just like the traditional housing market, properties along the beach have lost considerable value after the market took a nose dive in 2007.

WTOP’s beach journey begins in Ocean City.

“We’re basically back to where we all began,” says Karen Oass, a realtor with Long and Foster in Ocean City.

She’s referring to 2004, 2005 and 2006 when prices went up 28 percent each year.

That bubble burst and prices are now back to where they were in 2003 or earlier.

Oass says potential sellers have been forced to face reality.

“They’ve had to come to the realization that the market is not that it was and kind of get back to realistic pricing.”

She says realistic pricing is often fair market value, “that’s what buyers are willing to pay.”

Price declines have hit all types of beach homes, but condominiums may be hardest hit.

Condos have been plagued by foreclosures and short sales.

But Oass is optimistic the market is about to rebound.

“See, I’ve seen a lot of positives in the last two months,” she says.

She’s watching an increase in the number of condos and beach homes selling right now.

She’s also hopeful prices have bottomed out. She believes a normal cycle of price appreciation is around the corner.

“Not drastic appreciation normal appreciation, which is 3- to 5 percent,” she says.

Oass says while sellers are struggling, it’s certainly a buyer’s market with prices and interest rates low.

She says families are returning to the beach now that prices are more affordable.

“$300,000 will buy you a really nice place right now,” she says.

She says $300,000 appears to be a comfort price among many of her buyers.

WTOP’s Michelle Basch contributed to this story.