By Bill Conroy
What the locals say
The Free State’s economy is driven by federal spending.
Maryland may be small in size, but its geography offers great diversity, from
its Eastern Shore and Chesapeake Bay area to the Appalachian foothills and
mountains to the west. The state also is a leading producer of blue crabs and
has earned a national reputation for its crab cakes.
Known as the Free State, a reference to the abolition of slavery within its
boundaries in 1864, Maryland’s history has been shaped in large measure by
African Americans, who played a key role in building the state’s early tobacco
and maritime economies. Some of the nation’s most influential African Americans were born in Maryland, including Harriet Tubman, Benjamin Banneker,
Frederick Douglass and Thurgood Marshall.
Today, the state’s economy is driven by aerospace, defense contractors and
federal-research spending, which as a sector accounts for some 17 percent of
Maryland’s $365 billion gross domestic product (GDP). The state is home to
some 20 military facilities, including Walter Reed National Military Medical
Center — the largest military medical center in the country.
Defense contractors with a major presence in the state include Northrop
Grumman, Booz Allen Hamilton and Lockheed Martin. In addition, Maryland is
home to some 74 federal laboratories — twice the number of any other state. It
hosts major operations for the U. S. Food and Drug Administration, the National
Institutes of Health, the National Oceanic and Atmospheric Administration, the
National Institute of Standards and Technology (NIST) and also is home to the
NASA Goddard Space Flight Center — which has one of the largest concentrations of scientists, engineers and technology experts in the country.
Maryland also is a major center for information technology and cybersecurity,
and is home to NIST’s National Cybersecurity Center of Excellence, Lockheed
Martin’s NexGen Cyber & Innovation Center and more than 11,000 IT businesses. Some 51 percent of the state’s private workforce is employed by small
businesses, which collectively employ 1.1 million people, according to the U.S.
Small Business Administration.
The biotech industry is another pillar of Maryland’s economy. The state boasts
one of the largest concentrations of life-science companies in the country, with
more than 500 biotech and nearly 2,300 life-sciences companies operating in
the state — all supported by the research punch of Johns Hopkins University
and the University of Maryland. n
Home sales and prices
Maryland’s new-home market as of the end of this past third quarter
was “slightly improved,” according to housing-research company Metrostudy. Year-to-date starts through the first nine months of 2016 were
up 4 percent compared to the prior-year period. Existing-home sales
jumped by 11 percent over the same period, Metrostudy reports. Home
values in the state appreciated by 4 percent over the 12 months ended
this past November, according to Core Logic.
After posting a steady decline from 2005 through 2008, the year the
financial crisis gripped the nation, Maryland home sales have been on a
steady growth curve, going from 53,025 sales in 2009 to nearly 80,000
in 2016. Likewise, the median home price declined steadily from 2008
through 2011, bottoming out at $228,507, according to the Maryland
Association of Realtors. The median home price in the state has jumped
considerably since 2011, however, reaching $268, 180 in 2016 — which
was still below the high mark of $307,894 posted in 2007.
Maryland Home Sales
Source: Maryland Association of Realtors
Units sold Median sales price
President, Maryland Association of Realtors
“Because of the increase in the values of properties [in
Maryland], there’s fewer and fewer homeowners that are un-
derwater at this point in their mortgages, which means they
are going to be able to move up [to purchase new homes].
Also, Maryland has a lot of first-time homebuyer products to
get the first-time homebuyers into the market. We’re anticipating that there’s going to be a few interest rate hikes in 2017,
but we don’t really see that as pricing buyers out of the market.
While there will be increases, we’re still at incredibly low rates.”