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Ocean City Real Estate Information

Choosing a Realtor

There are literally hundreds of Realtors serving the Ocean City real estate market.  You owe it to yourself to do your due diligence before choosing an Ocean City Realtor to assist you.  The agent you choose to work with will have an impact on the value you get and the overall transaction.

1.  Experience

There are few ways that a Realtor can gain experience other than by working with Buyers and Sellers to get deals done.  While time in the real estate business helps, it doesn't necessarily equate to adequate experience.  A real estate agent that has been in the business for fifteen years part-time may not have as much useful experience as someone who has been in the business full-time for five years and had success.  Viewing an agent's track record of past sales and their agent ratings will always tell the full story.

2. Market Knowledge

Confirm the Ocean City real estate agent you choose has market knowledge and experience in the specific areas that are of interest to you.  Even in a small area like Ocean City there can be considerable differences between property types and related items.  If the agent you choose to work with is not familiar with these nuances it could make for a challenging transaction and large opportunity costs.

3.  Tools and Systems

Does the agent have tools and systems that are going to streamline the overall real estate process and make life easier for you?  If you are buying they should have tools to help you organize your search and make it more efficient.  If you are selling they should have a listing portal setup for you so you know what is going on with your listing at all times and are being provided feedback from property showings.  Once a purchase contract is secured they should have systems in place to assist in navigating from contract to closing with a minimum amount of hassles.

4.  Support Staff


Contract and Escrow Phase

You made an offer to purchase real estate in Ocean City or the surrounding areas, the Seller accepted your offer and now you are under contract … what is next?  Below is an overview of what you can expect as a Buyer as you work the escrow phase of the contract towards the property's settlement:

Mortgage Application

If you are financing your purchase the first step is to make official loan application with the mortgage lender you will be working with.  Once you have made application the mortgage company will gather all of the required financial and supporting documentation from you, order the property appraisal, request necessary information from the homeowner’s association and then submit the complete loan package to underwriting for final loan approval.  This process typically takes 30-45 days.

Title Work

While the lender is working through the loan process the title company will be researching the title and deed of the Ocean City property you are purchasing to ensure they are free and clear of any encumbrances.  Additionally, they will account for monies such as taxes and association fees and prepare all of the necessary documents for the property transfer at closing.

Property Inspections

Once the steps above are initiated we will get the property inspections scheduled.  A structural and mechanical inspection is the standard inspection that we order for all Ocean City property types.  We can also order specialized inspections for items such as chimneys, crawl spaces, docks and other items as needed.

HOA Review

If the property you are purchasing is part of a homeowner’s association you have the right to a review of all of the governing and financial documents of the respective association.  You will receive a resale package from the homeowner’s association of the Ocean City community you are purchasing in once you have a contract to purchase. ...

Buying Timeframes

Once people find a property they want to purchase the next question is "How long will the process take?"  The time it will take to get the property you are purchasing from accepted contract to closing will depend on a few factors, which I have outlined below.

Cash Purchases

If you are paying cash for your Ocean City real estate purchase the typical settlement timeframe will be around thirty days.  This allows ample time to complete the property inspections, review the condominium association documents, coordinate the closing funds and have all of the necessary title work completed. 

If it is your desire to settle sooner rather than later, cash purchases can be completed and closed within two weeks.  I will need to call in some favors to get everything above completed in time, however it is feasible and I do it quite often.  Fast settlements are attractive to a lot of Sellers and present the opportunity to get a good deal.

Financed Purchases

If you are financing your Ocean City real estate purchase the time from accepted contract to settlement will be in the thirty to forty-five day range.  If you are buying a home in Ocean City settlement can occur within thirty days.  If you are buying a condo the timeframe will be closer to forty-five days as there are additional steps in the financing process for condos.  These timeframes allow sufficient time for property inspections, appraisals, loan application, underwriting, home owners association reviews and title work.

These are general timeframes that I see for most Ocean City real estate transactions.  The timeframe that your specific deal moves along will ultimately be up to you. 

Feel free to contact me directly anytime at 443-614-9179 or via email below if you would like to discuss this in greater detail or have other questions.

Contact Nicholas


Fast Paced Market

We are currently in a fast paced real estate market in Ocean City.  Good inventory is low and well priced properties that are in good condition are selling withing a few days of hitting the market.  If you are currently in the market to buy real estate in Ocean City there are a few things you can do to put yourself in a favorable position to capitalize on a good opportunity.

New Listing Alerts

In the current market you have to be aware of the new listings and price adjustments for properties that match your specifications as soon as they become available, otherwise they may be gone by the next time you run a property search.  You can set these new listing alerts up on a variety of websites, however be aware that some are more accurate and do a better job than others.  I provide my clients with a  Property Updates Program and email them the new listings and price adjustments as soon as they hit the market.  The listing data is pulled directly from the Ocean City Multiple Listing Service (MLS), which is the most accurate and timely source of property information available.  This service saves my clients a lot of time and effort, while also ensuring they do not miss out on a good opportunity.

Mortgage Pre-Approval

If you are going to be financing your Ocean City real estate purchase securing a pre-approval letter from your lender ahead of time is a good idea for a couple of reasons.  First and most importantly, Sellers and their agents are requiring that pre-approval letters be submitted with virtually all purchase offers.  If a pre-approval letter is not included with your offer it can potentially delay negotiations and open up the possibility for competing offers to emerge.  Secondly, securing a pre-approval letter upfront will ensure your potential Ocean City...

Condominium Fees

As you have been searching online for Ocean City real estate you have probably noticed the condominium fees that are noted on each listing. A majority of the Ocean City condos for sale have monthly condominium fees associated with them and there tends to be a lot of confusion surrounding them.  This article will explain what they are and outline what they cover.

Condominium fees cover the operation, general maintenance and up-keep of the particular building the property is a part of. Basic condo fees cover building insurance, common area maintenance, professional property management, amenity usage and maintenance, reserve fund build-up, trash pick-up and water usage. A budget is determined for the building and then divided amongst the units that make up the condominium project. The amounts paid are based on the size of the particular property relative to the other units in the building. A three bedroom condo will usually have a higher condo fee than a one bedroom unit in the same building. This is largely because the three bedroom unit will warrant higher property and flood insurance costs, which are covered in the condo fee.  All Ocean City condo buildings set up their own structure as to how they operate, however there are some common similarities that I have outlined below.

Property Insurance

A large portion of the annual condo fee covers your homeowners and flood insurance policies. There are master insurance policies in place that cover the building, condo units and common elements. The only insurance you are typically responsible for obtaining is content insurance (HO6 policy), which covers the interior of the unit, your furnishings and personal belongings.  In the event there was an issue the master insurance policies through the condo association would rebuild the building and your HO6 policy would replace everything inside your condo.

Professional Property Management

A majority of the condominium associations in Ocean City...

Non-Resident Withholding

When you sell real estate in Ocean City and are not a resident of the state of Maryland you need to be aware of the non-resident withholding tax. In 2003 the State of MD enacted code that provided for income tax withholding on the sale of real estate in Maryland by non-resident individuals or entities.

Many non-residents of Maryland were selling real estate in Maryland and never reporting the gain as they are required to do via a Maryland tax return. As a result the state of Maryland was losing out on substantial tax revenue.  This was obviously not acceptable to the State of Maryland and the non-resident withholding tax is the result.

Settlement companies in the State of Maryland are charged with the duty of collecting the tax on the net gain at the time of settlement. The tax currently stands at 7.5% for individuals and 8.25% for entities (verify current tax rates at the time of reading). The way this works is the settlement company is required to collect the tax based off of the net proceeds from the settlement statement. As an example lets assume you sold a property for $500,000 and had $40,000 in closing costs and a payoff to your mortgage holder of $250,000. This would lead to net proceeds on the settlement statement of $210,000. The settlement company would then be obligated to collect $15,750 in non-resident withholding tax ($210,000 gain @ 7.5%).

Now the reality of the situation is that you likely paid more for the property than the $250,000 that you owe on the mortgage. Under the scenario above lets assume you paid $300,000 for the property. In addition you had closing costs when you purchased the property that were likely in the neighborhood of $15,000. This adds up to an adjusted costs basis of $355,000 (purchase price plus closing costs for the initial purchase and this sale). Subtracting this from the $500,000 sales price gives us a real gain of $145,000 and a non-resident withholding tax of $10,875.

An even worse scenario is...

Closing Costs - Buyers

One of the questions I am asked the most is ... How much are the closing costs and what do they cover?  Closing costs are the charges and fees that are involved when buying real estate in Ocean City. Closing cost amounts will vary depending on the purchase price, property type and overall terms of your deal, however there are some common similarities that I have outlined below.

Transfer Costs

The largest portion of your closing costs will be the transfer and recordation charges. The state and county collect these charges on all transfers of real property throughout the State of Maryland. The total combined amount of these charges is 1.66% of the purchase price.  Per the Maryland Residential Contract of Sale the transfer charges are split equally between the Buyer and Seller, however this is a negotiable item.


Any items that are paid in advance such as property taxes, waste water bills, condo fees, etc. will be pro-rated down to the day of settlement and the seller will be reimbursed for the remaining portion. As an example, property taxes are paid a year in advance. Lets assume the taxes are $6000 per year and you settle three months prior to the end of the tax year, which is July 1st.  At settlement you would reimburse the Seller $1500 and your taxes would be paid until the end of the current tax year. This process would be repeated for the condo fees, wastewater bills, etc.

Lenders Fees

You will be responsible for any fees your lender charges if you are getting a loan in conjunction with your Ocean City real estate purchase. These fees will cover the loan origination/application charges, credit reports, verifications, etc. These charges will vary by lender, however some common ranges are listed below:

  • Origination Fee $600 to $800
  • Credit Reports $25 to $50
  • Flood Certification $10 to $20
  • Condo Verification $100 to $150
  • Tax Service $75 to $100

Property Considerations

The search for Ocean City real estate can get a bit overwhelming with all the different property types and locations to choose from. To assist with this I thought it would be helpful to provide a list of the primary property features you should consider as you start your search for the perfect beach place.

Price Range

One of the first things to determine as you begin your property search is the price range that you would like to stay in. This price range will ultimately determine which locations and size properties will be available to you. At this point you will also want to consider if you are going to rent your Ocean City real estate as the potential rental income could impact this price range. I would be glad to provide you with rental estimates for the types of properties you are considering.

Property Size

The next thing to determine is what size home or condo will best suit your needs. You will want to determine this based on the number of bedrooms and bathrooms that you would like to have as opposed to square footage. Floor plans and layouts of Ocean City properties will be different from your primary home and can be deceiving. It is best to start with bedrooms and bathrooms and then eliminate the smaller options based on square footage.

Property Location

Now you will want to determine which of the various areas that make up the Ocean City real estate market you want to be in.  These areas include direct oceanfront, indirect oceanfront, oceanside, ocean block, bayside waterfront, bayside interior and West Ocean City.  Location options will largely be dictated by the price range you want to stay in and the property size you are looking for.

If you are considering renting your property its location will have a considerable impact on rental values and occupancy rates. As an example, property on the oceanside is more expensive than bay side property however the additional rental income it generates typically off-sets or exceeds...

The Rental Process

Ocean City has a strong rental market during the late spring, summer and early fall seasons that many property owners take advantage of.  Some people buy Ocean City real estate purely as a rental investment.  Others rent their properties out when they are not using them to offset some of their carrying costs.  If you are interested in renting your real estate in Ocean City there are a few ways to go about it. You can hire a rental company to handle everything for you, you can do it all yourself or you can do a combination of the two. You will find these three alternatives outlined below.

Rental Companies

There are a number of rental companies in Ocean City that will handle everything in regards to renting your Ocean City real estate for you. They will handle all of the advertising, booking, check in/out, cleaning and maintenance on your behalf. You essentially give them the keys and they handle the rest. They will collect all of the monies and disburse them to you as they receive them. In the event there is a considerable maintenance issue they will contact you to see how you would like to handle it.

Depending on who you choose to work with the rental companies charge betwee 12% to 16% of the gross rental income for this service.  You will also incur the costs of cleaning the unit in between each rental, which will vary depending on the size of the property.  As an example, a typical 2 bedroom/2 bathroom unit costs approximately $70 to $80 to clean.

You often get what you pay for when choosing a rental company. The larger, more well established companies charge a higher fee, however they have the advertising reach and systems in place to ensure you get maximum occupancy and a solid return on your investment.

Rentals by Owner

With the proliferation of the Internet many folks have started renting their Ocean City real estate on their own through sites like HomeAway and VRBO. All of the rentals are booked online with payments and...

Determining Price

In order to successfully sell Ocean City real estate in today's market you must have a well thought out and researched pricing strategy.  There is a lot of competition in the market and Buyers are more informed than ever.  Properties that sell are the ones that are priced well relative to comparable sales, their respective condition and overall market conditions.

When I prepare market evaluations for prospective clients I factor in a multitude of factors. First I will evaluate all of the comparable property data that is available to determine a baseline valuation.  I will then make adjustments to this valuation based on your properties condition, upgrades, views and any other unique factors.  Finally I will factor in overall Ocean City real estate market conditions to determine an effective pricing strategy for your property.  Below is an overview of this process.

Recently Sold Ocean City Real Estate

The first thing I look at are the comparable Ocean City properties that have recently sold.  I will break this information down to a sold price per square foot based on property size, bedrooms, bathrooms, views and amenities. This price per square foot value will then be applied to your property to establish a baseline valuation.  Adjustments will be made to this initial valuation to compensate for your property's condition, upgrades, unique features, etc.  This is the most accurate way to value Ocean City real estate and will provide us with a solid pricing foundation as we move forward.

Pending Ocean City Property Sales

Next I will look at the comparable Ocean City properties that are currently under contract. We want to ensure the price range we derived above is in line with the these pending sales.  There is a reason these properties sold and we want to leverage those advantages if possible.  Additionally, these pending sales provide direct insight into what potential Buyers for your property are thinking.


Ocean City Mortgages

A lot of things have changed in the real estate industry over the past few years and one of the biggest changes we have seen is the process for obtaining a mortgage to purchase real estate in Ocean City. Back in 2005 and 2006 if you could "fog up a mirror" you could get a mortgage. This contributed to the artificial run up in real estate prices and led to a considerable amount of the market instability we experienced.

As a result the banks are now making sure that every "i" is dotted and every "t" is crossed. Additionally, a lot of the programs that used to be available such as stated income loans for self employed individuals are now gone. The banks have plenty of money to lend and are eager to do so as that is how they make money, however now they are a bit more cautious and are ensuring that all Buyers are financially fit. This is ultimately a good thing as it will lead to market stability and ensure we don't return to the great recession of the late 2000's.

The key to navigating the mortgage process for buying real estate in Ocean City is finding a competent lender that is familiar with the process. They will be able to prepare you up front for what to expect and will ultimately make your life a lot easier.  Buying a second home in a resort community will be a different process than the one you went through in purchasing your primary home. As a result I always suggest working with a local lender whom is familair with the process and its unique nuances.

One of the biggest changes that we have seen over the past few years is the condominium review process. Back in the good old days when you were getting a mortgage for real estate in Ocean City the lender was only concerned with approving the Buyer and quite frankly didn't care where or what you were purchasing.

During the boom years various condominium projects and homeowners associations throughout the country began having financial problems, which ultimately caused problems for the banks.  As a result the banks/mortgage...

Closing Costs - Sellers

In the discussion of selling real estate in Ocean City with my clients I am often asked what closing costs will be involved and how much they are. Closing costs are going to vary from deal to deal, however there are some common similarities that I have outlined below.  It is helpful to know what these costs are going to be in the beginning of the process so you can properly position and market your property accordingly.

Transfer Costs

Every time a property transfers in Maryland the state and local municipalities charge transfer taxes on the sale, which total 1.66% of the purchase price. As an example a $500,000 property sale would have $8,300 in transfer taxes associated with it. Per the Maryland Contract of Sale these transfer taxes are split equally between the Buyer and Seller, however they are a negotiable item.


The Seller of real estate in Ocean City will typically be responsible for the commissions associated with the sale. Current commission rates range from 5% to 6% depending on the property and the Ocean City Realtor you choose to represent your listing. These commissions are not paid unless the property goes to settlement and are then collected from the proceeds of the sale.

Deed Release

The Seller is responsible for the costs associated with releasing the current deed so that the property can transfer. This cost will vary depending on the property and the title company doing the settlement, however it typically ranges from $125 to $150.


You will be reimbursed for any items that you have paid in advance. This will be for items such as taxes, condo fees, waste water, etc. These items will be prorated down to the day of settlement and you will be reimbursed the unused portion. As an example, property taxes are paid in advance on July 1st of each year. Assuming you went to settlement on your Ocean City property on March 1st you would be reimbursed for 4 months of taxes.

Non-Resident Withholding Tax


Rental Cost Coverage

One of the things I am asked about most frequently as a Realtor in Ocean City is the process of renting out real estate in Ocean City. Folks typically want to know how it works and and what type of income and carrying cost coverage they can expect. I recently wrote a post regarding the overall process of renting property in Ocean City.  In this post I am going to provide an overview of rental income, associated costs and how much of your properties carrying costs you can expect to cover.

The question I am asked the most in regards to renting real estate in Ocean City is ... Will the rental income cover all of the carrying costs for the property?

The short answer is no. There are situations where this is possible, but they are few and far between and typically require a larger down payment. As a general rule I advise my clients to expect the rental income for their property to cover the mortgage principle and interest obligation. This is a conservative approach and in some instances (lower interest rates) you will generate additional income to help cover the taxes, condo fees. etc.   Additionally, if you put down more than the typical 20% down payment you will have a smaller mortgage obligation and the rental income will help cover a larger portion of the other carrying costs..

To illustrate this I will breakdown a rental scenario for your typical two bedroom/two bath ocean block condo purchase:


Purchase Price: $230,000

Down Payment: $46,000

Mortgage Payment: $10,224 (Yearly principal and interest for a 30 year fixed mortgage @ 4%)


Gross Rental Income: $14,000

Rental Commissions: $2,240

Cleaning Fees: $750 (10 weeks at $75 per clean)

Net Rental Income: $11,010

As another example I will break down a three bedroom/two bath oceanfront condo:


Property Insurance

As a  Realtor in Ocean City I am often asked about property insurance and thought it would be helpful to put together an article outlining the basics.  Insurance requirements will vary and the cost, type and amount of coverage you will need will ultimately be dictated by the location and type of property you purchase.

If you are buying an Ocean City property that is part of a condominium association your primary insurance coverage will be included in the condo fee that you see noted on each listing. The condo association has a master insurance policy in place to cover fire, flood, hazard and general liability insurance. The only insurance that your typically required to have in this situation is contents insurance, also known as an HO6 Policy. The HO6 policy covers the interior of the unit, your personal belongings, furniture and any improvements that you make to the property.

To illustrate how this would work, lets use a worse case scenario that a hurricane comes through and levels the building that you are an owner in (not likely!). The master insurance policy covered in the condo fee would rebuild the building to its original form and your content insurance would cover the replacement of the interior of the unit, your furniture, personal items and any improvements that you made to the property.

Contents insurance is relatively inexpensive. As a very general rule you can estimate $15-$20 per month for each bedroom that the unit has. If the unit has a lot of upgrades or more square footage than the average unit it will be on the higher end. Conversely, content insurance for bay side non-waterfront property is going to be less expensive than insurance for direct oceanfront property. Content insurance is typically obtained from the company that has the master insurance policy in place for the building. It is the least expensive option and in the event there is a problem you will only be dealing with one insurance company as opposed to several.

If you are buying a single family...

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