Home sales for region decline 3% in August

September 07, 1995|By Lorraine Mirabella | Lorraine Mirabella,Sun Staff Writer

Sales of new and previously owned homes in metropolitan Baltimore fell 3 percent in August, continuing a slump of more than a year, the Greater Baltimore Board of Realtors said yesterday.

Sales slipped to 1,756 in Baltimore and in Baltimore, Carroll, Harford and Howard counties, down from 1,807 last August, the board said.

But sales agents and brokers are predicting a brisk fall market, based on increased interest in home buying this month and a 32 percent jump in the number of contracts signed in August. That number climbed from 1,400 in August 1994 to 1,853 last month.

"I would characterize this as a very good market," driven by restored buyer confidence, low interest rates and an abundance of homes for sale, said James P. O'Conor, chairman of O'Conor, Piper & Flynn Realtors. "The downturn that was there last year has now gone away."

But slow job and wage growth in the state make it unlikely that sales will improve enough to overcome a weak first half, said Michael Funk, assistant director of the University of Baltimore's Regional Economic Studies Program.

"The low interest rate environment we're in will enable those who are working and seeing some income growth to get out there and purchase homes," he said. "But I don't think the strong figure for [pending] sales is an indicator that we'll have an extraordinarily robust market the second half of 1995."

The August sales decline continued a slump that began in July 1994, with sales off more than 20 percent in January, February and April. Given such decreases, some view the 3 percent decline as a positive sign.

"The people who weren't buying in April, these are all the people who are out there now," said Patrick J. Kane, vice president of Coldwell Banker Grempler Realty Inc. Rates "are not on a downward trend, and people look at it as if this is as low as it will go."

Interest rates on 30-year, fixed-rate mortgages averaged 7.94 percent in the Baltimore area last week, according to HSH Associates of Butler, N.J., which tracks mortgage rates.

Though sales fell in August in the city and Carroll and Harford counties, the markets in Howard and Baltimore counties perked up, with increases of 7 percent and 4 percent respectively.

The 310 settled sales in Howard and 652 in Baltimore County reflect some of the properties purchased in midsummer.

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