The housing market in the Washington area as a whole may be on the rebound, but the market in Prince George's County, Md., still stands out as the weakest among the area's jurisdictions. A recent assessment shows that home values in Prince George's have decreased 35 percent over the past three years, the steepest of any county in Maryland.
And while foreclosure rates over the past four months have improved for the county hit hard during the financial crisis, Prince George's still has the highest number of foreclosures of any county in the state by a wide margin, according to November statistics published by RealtyTrac.
Why is this? Jason Harmon, a Realtor with Keller Williams Flagship of Maryland, said that the problem originated with the county's lower-income residents who saw a chance to buy the homes they had only dreamed of during the real estate boom, but couldn't afford to keep them when the housing bubble burst.
Harmon, however, also blamed the county's property taxes for making real estate less affordable there. "The assessment of the property taxes in Prince George's County is way off. Some homes are taxed at a rate of $500,000 when the homes are worth $250,000. There haven't been any adjustments to the assessment."
Eli Lehrer, who runs the Washington office of the free-market Heartland Institute, cited several reasons why Prince George's is faring worse than other places, including the overbuilding of homes in the county, a high unemployment rate and the county government doing less than others in directing growth around Metro stations.
"If you look at the Metro stations in Arlington, for example, there's very high density of development around them. ... P.G. County saw so much less than that and that made it harder," he said.
But Lehrer argues that the County's housing market really isn't that bad when compared with the rest of the country. He also noted that unemployment in Prince George's County -- 7 percent in October -- is lower than the national jobless rate of nearly 10 percent.
"The situation in P.G. County is worse than the situation anywhere else in the D.C. metro area," he said, "but by many measures it's actually doing better than the country as a whole. This is a problem, but it's not an incredibly severe one by national standards."