The Ocean City, MD real estate market continues to evolve, shaped by interest rate shifts, financing programs, and the unique dynamics of a resort and investment-driven coastal community. To help unpack these trends, Michael Nolen of Atlantic Shores Sotheby’s International Realty sat down with Sam Kotzur of CMG Home Loans for an in-depth conversation about today’s lending landscape.

This article breaks down the key topics covered in my interview — and the full video (attached to the blog) offers even more insight for buyers who want a deeper look into the mortgage process in Ocean City.

Mortgage Interest Rates in the Ocean City, MD Real Estate Market: Why Buyers Are Paying Attention?

WATCH THE VIDEO INTERVIEW BELOW (& Read a Summary with details too!)

Current Mortgage Rate Trends

Interest rates have played a major role in Ocean City’s second-home and investment-property market.

According to Sam, recent decreases into the low 6% range have created a noticeable shift in buyer sentiment. While rates are still higher than the ultra-low years of the pandemic, today’s numbers represent a much more favorable environment compared to the peak periods of rate spikes.

Local real estate professionals — including Michael’s team — have seen increased engagement and conversations on social media as more people recognize that today’s lower-than-expected rates can open doors to buying sooner rather than later.

Economic Forces at Play

Sam explained that many buyers misunderstand how the Federal Reserve affects mortgage rates.

While the Fed influences economic policy by adjusting the federal funds rate, mortgage rates actually move more closely with Treasury bond yields, particularly the 10-year Treasury.

Understanding this distinction helps buyers make sense of why mortgage rates sometimes shift independently of Fed decisions.

Navigating the Mortgage Loan Process in the Coastal Ocean City, MD Real Estate Market

What Really Determines Your Mortgage Interest Rate?

Mortgage rates in Ocean City — as in any market — are influenced by a combination of factors that go far beyond the daily rate sheet:

• Credit score & credit history
• Down payment size
• Debt-to-income ratio
• Loan type (conventional, DSCR, jumbo, etc.)
• Property type (condo vs. single-family home)
• Intended use (primary residence, second home, or investment property)
  
  

Buyers should resist the temptation to chase a headline rate. Instead, Sam stresses the importance of understanding your entire financial profile, referring to this as “peeling back the layers of the onion.”

A great rate is always the goal — but the path to getting it varies from buyer to buyer.

Helpful Blog Related Blog Article: "5 Smart Mortgage Options for Ocean City, MD Short Term Vacation Rental Investing"

Ocean City’s Specialized Mortgage Financing Environment

Because Ocean City is a second-home and investment-heavy market, buyers often need a more tailored approach to lending. Properties used for rental income or personal vacation use sometimes require additional layers of underwriting and financial review.

This makes early conversations with a local lender even more valuable.

Condos vs. Single-Family Homes: What Buyers Should Know

Financial Structure Differences

Ocean City is known for its large condo inventory, and Sam points out that condos carry different financial considerations compared to single-family homes.

Condos involve:

• Shared financial responsibility among all unit owners
• Added layers of insurance
• HOA budgets and reserve studies
• Maintenance fees and community management

These factors influence a lender’s risk assessment — which in turn can impact mortgage terms and rates.

Helpful Related Blog Article: "5 Things to Know for Condo Financing in Ocean City, MD"

Investment Property & Second-Home Mortgage Financing Options

Ocean City investors and vacation homeowners often explore:

• Conventional financing
• DSCR (Debt Service Coverage Ratio) loans
• Portfolio loan options
• Second-home financing programs

Each comes with its own benefits depending on whether the buyer prioritizes monthly payment, cash flow, flexibility, or long-term investment growth.

Seasonal Timing in Ocean City Real Estate

Fall Buying Surge

Michael highlighted that fall consistently becomes one of the busiest real estate seasons in Ocean City. As the summer crowds leave, many owners decide it’s the ideal time to sell, creating a spike in inventory and buyer activity.

This season is particularly attractive for:

• Securing potential tax benefits
• Completing renovations in the off-season
• Getting ahead of the upcoming spring rental demand

Preparing for Spring & Summer

While fall is strong, buyers who prepare during winter position themselves perfectly for the spring market.

Early preparation might include:

• Getting pre-approved
• Understanding renovation costs
• Reviewing rental income projections
• Completing financial planning ahead of peak season

Being proactive ensures buyers don’t get caught in spring’s competition without a strategy.

Helpful Related Blog Article: "What's the Ideal Time to Invest in Ocean City, MD Real Estate?"

Why Education & Early Planning Matter

A consistent theme throughout the interview was setting realistic expectations and getting informed long before making an offer.

Whether you’re buying:

• a primary residence,
• a second home, or
• a short-term rental investment

The most successful buyers are those who start conversations early with both their Realtor® and lender. Understanding goals, budget, long-term plans, and financing options ensures each buyer makes clear, confident real estate decisions.

Conclusion

The Ocean City, MD market offers incredible opportunities — especially now, with lower rates and growing access to flexible financing solutions. Buyers who take the time to understand their mortgage options, the seasonal end and flow of the market, and the unique differences between property types will be best positioned to succeed.

To explore these topics further, watch the full interview video with Michael Nolen and Sam Kotzur, and Subscribe to my Real Estate Blog, for ongoing insights into Ocean City MD’s real estate, vacation rental investing and mortgage trends.