July 27, 2022

Did Maryland's Real Estate Market Crash? A 2022 Case Study

Kevin Grolig revisits his July 2022 crash call for Montgomery County MD — what actually happened, and how to judge today's market predictions.

No, Maryland’s real estate market did not crash in 2022, and I said as much back when I recorded a video on this exact question in July of that year. I predicted a plateau, not a collapse, and a slow rebalancing rather than a flood of foreclosures. I’m revisiting that call now because the same panic keeps resurfacing every time rates move or the news cycle needs a scary headline. If you want to know how to separate real risk from noise, the 2022 moment is a useful case study, because I laid out my reasoning in real time, before I knew how it would turn out.

What did the Montgomery County market actually look like in mid-2022?

In July 2022, the market still favored sellers, but nowhere near as strongly as it had from January through April of that year. Home prices and sales volume in Montgomery County had hit all-time highs coming out of the pandemic run-up, and inventory was historically low across the county. Earlier in 2022 I was routinely seeing 10 to 15 buyers competing for a single listing. By midyear, that intensity had started to cool, especially as interest rates climbed and cut into buyer purchasing power by as much as 30 to 40 percent in some cases. Under the $300,000 price point, though, competition barely budged, still 10 to 15 buyers per home, because entry-level inventory stayed brutally tight.

Why didn’t rising rates trigger a crash?

Rising rates slowed demand, they didn’t collapse it, because inventory never caught up to the number of buyers still in the market. A crash needs an oversupply of homes hitting the market at once, paired with buyers who can’t or won’t hold on. That combination simply wasn’t present in 2022. Instead of a flood, I saw a slow, uneven cooling: properties sitting a little longer, inventory ticking up gradually quarter over quarter, and pricing starting to flatten rather than fall. That’s a correction pattern, not a crash pattern, and the distinction matters more than people realize when they’re deciding whether to buy or sell.

How was 2022 different from the 2007-2008 crash?

The 2022 market was structurally nothing like 2007-2008, because the loans behind it were nothing alike. The buyers who got wiped out in the last real crash were often approved with little to no down payment, stated income with no verification, and adjustable-rate, interest-only mortgages that reset into payments people couldn’t sustain. When those rates adjusted, owners walked away in large numbers, and foreclosures and short sales flooded the market with inventory that far outpaced demand. In 2022, by contrast, the buyers I worked with over the prior fifteen years had fully documented loans, real down payments, and mostly fixed rates locked in at historic lows. Homeowners with genuine equity and skin in the game don’t hand their keys to the bank the moment the market softens. That single difference, loan quality, is the reason a plateau looked far more likely than a repeat of the last decade’s collapse. You can see the long-run pattern of home prices and mortgage rates yourself through the Federal Reserve’s economic data atFRED.

What should buyers and sellers have done with that information?

Sellers who were already planning to sell within a year or two had good reason to consider moving that timeline up rather than waiting, since a more balanced market meant less leverage down the road. Buyers, meanwhile, were handed something they hadn’t seen in years: less competition. Going from fighting off 10 or 15 other offers to facing one, two, or none at all gave buyers real room to negotiate price and terms for the first time since the pandemic buying frenzy started. Neither group needed to panic. They needed to read the specific conditions in their price range and act on facts rather than headlines. For a longer view of how national buying and selling patterns have shifted, the National Association of Realtors publishes ongoing market research atNAR Research and Statistics.

Why does this 2022 call matter for reading today’s market claims?

It matters because the questions people are asking right now are the same ones I answered then, just with new dates attached. Every time rates shift or a national outlet runs a crash headline, the right response is the same one I used in 2022: look at actual inventory levels, loan quality, and local price-range data instead of reacting to the noise. Montgomery County’s numbers told a clear story in 2022, and they still do today, but the story is different in every price range and every submarket. That’s why I track our local numbers directly rather than relying on national averages, and you can review the current local snapshot yourself on mystats page.

Frequently Asked Questions

Did home values in Montgomery County actually fall after 2022?

Values plateaued and, in some pockets, softened modestly rather than collapsing. The steep, foreclosure-driven declines of 2007-2008 never materialized because the underlying loans were sound.

Is a “correction” the same thing as a “crash”?

No. A correction is a gradual rebalancing of supply, demand, and price, usually with the market absorbing it over quarters or years. A crash involves a sudden oversupply, typically from distressed sales, hitting the market faster than buyers can absorb it.

Should I still buy a home when rates are elevated?

That depends on your price range, timeline, and how much competition you’re actually facing. In 2022, buyers who could afford the higher rate often faced far less competition than they would have a year earlier, which gave them negotiating leverage. Talk through your specific numbers before deciding, and myguide to buying a homeis a good starting point.

What made 2022 different from a bubble about to burst?

Loan quality. Fully documented loans, real down payments, and fixed rates mean homeowners have equity and reasons to stay put, even when the market cools. That’s the opposite of the underwritten-to-fail loans that caused the last crash.

How do I know if today’s market conditions are more like early 2022 or late 2022?

It comes down to current inventory levels, days on market, and how many offers similar homes are drawing in your specific price range and neighborhood. Those numbers change often, and I update them regularly, so reach out through mycontact pageand I’ll walk you through what’s happening right now.

Markets move in cycles, and the loudest headline rarely tells you which part of the cycle you’re actually in. My job is to read the local numbers, not repeat the national panic, and that’s been true since long before this video. If you want to understand why clients trust that approach, take a look atwhy Kevin. And if you’re weighing a move in Montgomery County or the surrounding DMV, right now is a good time to get real numbers instead of guesses.

Let’s talk about your specific situation. Book a free 30-minute strategy call with me here.

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