Metro area home sales stay strong Robust economy, low interest rates continue streak

'We're loving life'

Baltimore region shows increase of 26.79% over last year

Real estate

June 10, 1998|By Kristine Henry | Kristine Henry,SUN STAFF

A robust economy combined with low interest rates kept area home sales strong in May, edging out April's gains but not quite reaching the high numbers of February and March.

The Baltimore metropolitan region showed an increase of 26.79 percent over the same period last year, marking the ninth straight month of higher home sales.

The strong local numbers come on top of last week's Commerce Department report that nationwide new-home sales rose 5.2 percent to an all-time high in April with an annual rate of 888,000 units. Existing home sales that month were 18.1 percent higher than the previous year's month, but down 2.5 percent from March's record resale high of 4.89 million units.

Locally, Carroll County saw the biggest gains with a 45.86 percent increase, while Anne Arundel saw only a 5.92 percent rise. Howard County posted a 34.1 percent increase; Baltimore County 26.84 percent; Harford County 26 percent; and Baltimore 22.03 percent, according to the Metropolitan Regional Information System and the Anne Arundel Multiple List.

"I think almost everything that might be a factor in home sales is positive," said Michael Carliner, an economist at the National Association of Home Builders in Washington. "Consumer confidence is high, employment growth is strong, unemployment low and stock market growth is also a major factor."

Regional home sales in April weren't quite as strong as May's, rising by 22.4 percent, but March's increase was 41 percent, and February saw sales rise by 30 percent.

Anne Arundel County's comparatively moderate May gains have silver lining: The county saw the highest increase -- 27.7 percent -- in pending contracts, an indication of future activity. It also had the highest jump in sales from April to May, rising 19.85 percent to 483 units sold compared to April's 403.

"We're loving life," said Jon Coile, vice president of Champion Realty Inc. in Severna Park, the state's largest independent, locally owned real estate company. "In Anne Arundel County, we've seen appreciation and multiple bids on higher-end properties. We haven't seen that situation since the late '80s."

Coile said that while Anne Arundel County might have posted only a 5.92 percent increase, Champion's business is up 19.17 percent this year compared to the first five months of 1997.

Although Maryland lags behind most other states with a 1 percent rate of job growth vs. the national average of 2.6 percent, the state is enjoying lower-than-average interest rates. At the close of last week, the rate on a 30-year fixed mortgage was 6.99 percent, and the national average was 7.1 percent, according to HSH Associates, a New Jersey firm that tracks and analyzes mortgages. While not as striking as October 1993's 28-year low of 6.83 percent, it's a far cry from the 18 percent rates seen in the early '80s.

"If you were to describe the ideal housing market, it would be a strong economy with low interest rates," said Mary Antoun, executive vice president of the Maryland Association of Realtors. "You couldn't ask for anything better. I don't see a slowdown coming anymore than in the rest of the economy. Consumer confidence has been restored, and there's a lot of pent-up desire to buy a home. And you can buy more of a home in a low-rate environment."

The average price of a home increased in all areas except Carroll County, where it dropped by a quarter of a percent to $161,127. Anne Arundel saw the biggest increase with average prices rising 7.72 percent to $157,765 from $146,465 a year ago.

"We're happy with the market," Coile said. "It's good, but not blazing."

Pub Date: 6/10/98

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.