Realtors See Signs Of Recovery In Housing Market

Shift To Lower-priced Homes Offsets Slump

March 11, 1991|By Arthur Hirsch | Arthur Hirsch,Staff writer

Don Crist Jr. pulls out of the Glen Burnie real estate office in theMercedes with the DON JR plates and makes you feel like some doom-monger for even mentioning the word recession.

Crist, associate broker at Century 21-Crist Realty, is heading out this morning to meet aninspector at a $107,500 three-bedroom ranch-style house on Elvaton Road, a sale he'll close this afternoon.

The deal was part of a $1.5 million December for Crist -- about double the volume of the average good month for a broker. "I had an unbelievable December," said Crist, adding that the Elvaton ranch was on the market less than a week. "All these (sales) are settling now. I've been telling my agents, don't necessarily listen to what you hear in the media. We've been, really since the first of the year, very,very busy."

Crist acknowledges that the number of sales in the office

dropped about 10 percent between 1989 and 1990. And now, he says most of its business is in the market's low- to moderately-pricedrange -- $90,000 to $150,000. At the moment, that's where the business is.

"We may not make as much money, but we don't get hit as hard," said Crist. "We still have plenty of people in apartments lookingfor their first house."

Crist said a house priced right now usually takes up to 60 days to sell. "But that may change. The market's really seemed to pick up a lot."

Chris Coile, president of Champion Realty Inc., said the fastest-selling project in the Baltimore area is Cromwell Fountain condominiums in Glen Burnie, where Champion sold 21 units in December and about 20 in January. The units are priced between $61,000 and $85,000.

Lynn Dulin, president of the county Association of Realtors and head of Champion's commercial division, saidsigns of recovery are surfacing.

"The first two months of this year have shown a strong rebound" in the residential market, Dulin said. "I've been talking to Realtors the last couple of weeks. I see a lot of smiling faces."

Commercial real estate sales, however, have been slower to recover, Dulin said, partly because sellers have been slow to adjust to the post-'80s market.

"Sellers still want yesterday's prices," said Dulin. "There are always buyers out there, but thebuyers are saying, 'You are going to do it my way, seller, or I'm not going to buy your property.' "

She also said banks have tightened requirements for commercial lending, making it harder to finance commercial projects.

In the residential market, higher-priced homes have been the slowest to sell in the last six months, brokers say, ashomeowners looking to move up have been holding off, watching reports on the economy and the Persian Gulf.

Dulin said the market is slowest among the $300,000 and up homes.

Crist said homes in Shipley's Choice, where he lives, were listed at $235,000 to $250,000 eight or nine months ago, and have dropped to $225,000 and $230,000.

Because the slowdown appears to have had its greatest impact on higher-priced homes, Crist said, "we find a lot of Severna Park agents showing in Glen Burnie."

Coile said Champion Realty's sales dropped about 10 percent in 1990. Across the industry, he said the market was down about 20 percent. And the average sales price has fallen because ofthe shift to lower-priced homes.

"We started to slow down in May 1989," said Coile, whose agency operates in Anne Arundel County and the Eastern Shore. "Anybody in the business will tell you the same thing."

He traces that lag to mortgage rates, which rose about that time and have since fallen to about 9 percent.

The next market slump, in March of last year, he calls "totally news driven, it was the papers, en masse, projecting gloom and doom."

The elements of the early 1980s recession -- high interest

rates, high unemployment, soaring gas prices, backlogged factory inventories -- are not there this time, he said.

This time, Coile said, it's a plague of consumer unease brought on by bank failures, the savings and loan debacle, federal and state deficits and the war.

"When the problem is consumerconfidence," said Coile, "the problem could be a combination of 50 different things."

Coile said one local builder has tried to assuage fear by offering to buy the house back or take over payments for a limited period if the buyer loses his job.

"That's not going to doit," said Coile. "I don't think that you can sell houses on a negative."

Champion has taken a slightly different tack in marketing theCranberry Woods development in Crownsville, where lots go for $150,000 to $200,000. Under the "100% Confidence Program," the builder offers to buy houses back for the full purchase price after two years, for any reason.

Tomorrow: Builders, too, find smaller is better as they weather the construction slump.

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