Sales of new homes down for region Slow-growth policies, job, rate fears blamed

July 31, 1996|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

A sharp drop in Baltimore area new-home sales for the three months ended June 30 dragged totals down for the first half of the year, Legg Mason Realty Group said yesterday.

Builders blamed job insecurity, rising mortgage rates and slow-growth policies in the state for declines of 14 percent for the second quarter and 5 percent for the first half.

During April, May and June, 2,228 homes sold, bringing midyear totals to 4,841 homes sold in Baltimore and Baltimore, Anne Arundel, Carroll, Harford and Howard counties, according to the realty group's quarterly survey of new-home projects of 20 homes or more.

Single-family home sales fared best -- up 2 percent in the quarter and up nearly four percent in the half, compared with 1995 levels. But townhouses and multifamily sales plummeted 10 percent and 14 percent, respectively, for the half.

"They're not lining up -- I blame it on job insecurity as much as anything else," said John Clark, president of Clarklein Development, a builder of townhouses in Essex for first-time buyers.

The sales results widened the gap between single-family sales and townhouse sales in the Baltimore region, Legg Mason said. Last year, townhouses had sold at the same level as single-family homes.

During the second quarter, single-family homes accounted for nearly 47 percent of new homes sold, while townhomes accounted for just 41 percent of sales.

That mirrored a pattern throughout the mid-Atlantic region of Baltimore, Philadelphia, Wilmington, Del., and Washington, Legg Mason said.

Clark said builders have had to offer more house for the money to make up for a lack of appreciation.

"People aren't making the paper profit they used to, and consequently they're staying put longer because of closing costs," he said.

For the Baltimore region, sales fell most dramatically for the half in Anne Arundel County, down 13 percent overall and down for each housing type. Sales rose in Harford County, up four percent for the half and increasing the county's share of the area new-homes market from 15 percent last year to 18 percent for the quarter.

Strong detached-home sales -- up nearly 30 percent over last year's first half -- drove the market in Harford County, Legg Mason said.

While sales have declined, the median base price of a new home has risen slightly since the beginning of the year, to $176,200.

Allan Waschak, president of Allan Homes Inc., said most of his sales in the Pointers Run neighborhood of River Hill in Columbia have fallen in the $210,000 to $275,000 range, the lowest priced of his three product lines.

"We're selling two to three a month," he said. "We see a lot of activity at that price point."

For the first half, Ryan Homes dominated the market, selling 586 homes and surpassing former leader Ryland Homes in volume. Ryland sold 307 homes, while Pulte Home Corp. sold 240.

Pub Date: 7/31/96

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