New homes, resales set torrid pace Boom: Sales of new homes of all types are running 26% ahead of last year's turnover

Midyear Report: New Home Sales

August 09, 1998|By Robert Nusgart | Robert Nusgart,SUN REAL ESTATE EDITOR

For Paul and Michele Shultz, it all happened so fast.

In March, the Howard County couple stuck a "for sale" sign in the front yard of their Columbia split-level. Within hours they had a buyer and three days later a ratified contract.

And last week -- just in time for their daughter's third birthday -- they moved into their new four-bedroom home in Clark's Glen in Clarksville, one of the hottest selling single-family home communities.

The Shultzes' experience is typical of the phenomenon that has helped fuel the housing boom in the Baltimore metropolitan region: Buyers purchase existing homes, allowing those homeowners to move up to new, more expensive homes and prompting builders to increase production.

With Baltimore's resale market experiencing one of its best six-month periods in recent memory -- up 24 percent over the first half of 1997 -- new-home sales are enjoying similar success, showing a 26.4 percent increase, according to midyear figures released by Meyers Housing Data Reports.

"It's always a nice story when the metro Baltimore market is about 26 percent ahead of last year, which translates to more than 1,000 additional units that have been sold compared to last year as of the end of June," said Ken Sugarman, national #F operations director for Meyers, a Washington publication that tracks and analyzes new-home sales.

"What is also nice is that all product types -- singles, townhouses and condos -- are outpacing last year's performance, which is unusual [but] a nice change of pace," Sugarman added.

Of the hottest selling communities in the region, Clark's Glen, developed by Pulte Homes Corp., had the most activity for detached single-family homes in the first half of the year with 34 sales.

Annapolis Overlook, a townhouse community built by PCS Homes, was the area's top seller with 54.

Next with 46 sales was Fairway Courtyards, a condominium project being built by Chateau Builders in Howard County's Waverly Woods development.

Overall, builders reported sales of 5,168 units for the first six months of 1998, compared with 4,088 for the same period last year. And most new homebuyers gravitated to Howard and Anne Arundel counties.

New-home sales in Howard were up 37.5 percent over last year and Anne Arundel showed a 36.5 percent increase in the first six months. Baltimore County had a 23.6 percent increase, Carroll County was up 18.4 percent and Harford County showed a slight, 3 percent increase.

And within Howard and Anne Arundel, the most sought-after areas were the U.S. 29/Ellicott City corridor (up 102 percent) and along the Baltimore-Washington Parkway and Route 3 market (up 53.1 percent).

Nearly quadrupled

In fact, the townhouse market in that area of Howard County -- which features Washington Homes' Howard's Ridge, Ryan Homes' Ellicott Overlook and Ryland Homes' Hollifield Station, among others -- was so strong in the first six months that it almost quadrupled its 1997 sales for the same period, from 46 to 165.

The difference from last year's sluggish sales to this year's activity, according to Sugarman, is the continuation of low mortgage rates, high consumer confidence and the strength of the resale market.

"There is no magic wand waved over the market; it's just a consistent, sound development approach going on," Sugarman said.

"What we are seeing is that not only is the volume up, but the sales price that they are getting is up," he said, adding that the average price of a single-family home is running 3 percent ahead of last year's level at $231,873. "It's not huge jumps, but they are getting everything they can get."

Sugarman said average single-family home prices in Baltimore and Carroll counties were 5 percent higher than a year ago. In Baltimore County, the base price of a new single-family home was $213,700, and in Carroll it was up to $206,122. The average base price in Harford was $187,817, unchanged, and Anne Arundel was up 2 percent to $249,213.

But Howard County was by far the most pricey, with the average single-family home at a base price of $273,592, a 1.8 percent increase over the same period in 1997.

"But what I think is more interesting is that condo prices have climbed significantly over last year, up 11.4 percent," Sugarman said, adding that the average base price for a condominium was $115,640. For townhouses, it was $128,182, up 2.1 percent.

At Brookside at Kendall Ridge in Columbia, prices at the townhouse community have risen $10,000 since the beginning of the year, according to Lawrence I. Rosenberg, president of Mark Building Co.

The community, which opened in October 1995, had 42 sales in the first six months of the year, including 14 in May alone, making it one of the area's top-selling townhouse communities.

Rosenberg is no stranger to buying frenzies. In 1990, his company sold 48 homes in five days at Worthington Glen in Owings Mills. But he doesn't liken this year's market to the buying "euphoria" of the late 1980s, saying today's homebuyers are more prudent.

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