Home sales resume climb

Metropolitan-area deals for existing houses up 14.8%

June 10, 1999|By Robert Nusgart | Robert Nusgart,SUN STAFF

After catching their breath in April, sales of existing homes for May in the Baltimore metropolitan area went back into high gear last month, jumping 14.8 percent over the corresponding period last year.

The rise was punctuated by a 37 percent increase in sales in Baltimore, the highest for the city this year. All but Carroll County -- with a 7.14 percent drop -- showed increases. Sales in Harford County rose 19 percent; Baltimore County was up 13 percent; Anne Arundel gained 12 percent and Howard gained almost half a percent.

"May worked out as the best May that we have had," said James P. O'Conor, president and chief operating officer of O'Conor, Piper & Flynn ERA, who added that company sales were 14 percent over May 1998.

"It's now 26 straight months where sales for the month have been better than the corresponding month of the year before. It is unbelieveable," O'Conor said.

In April, sales areawide rose 7.6 percent.

To show how robust the metropolitan market has become, almost 51 percent more homes were sold in May 1999 than in May 1997.

"It has surprised me that it has lasted as long as it has," said P. Wesley Foster, owner of Long & Foster Real Estate Inc. "We're up 20 to 25 percent over last year, which was a phenomenal year," Foster said.

"I would suspect that it will last as long as interest rates stay low and job and consumer confidence stays high if that is possible. It's got to run out of steam sometime, but the minute you jiggle, either one of those -- it's gone."

Mortgage rates have risen in the past week. According to last week's Freddie Mac national survey, the 30-year, fixed-rate mortgage climbed to 7.41 percent, the highest in a year.

Overall, the average price of a home in May cost area buyers $148,269, a 1.7 percent drop from last year. However, the average price of a single-family detached home rose to $196,507, a 3.3 percent increase over May 1998. And when it came to homes with at least four bedrooms, every jurisdiction showed higher prices.

Tim Rodgers, president of Hill & Co., the Cross Keys boutique firm known for its luxury home sales, called May's activity "terrific," but cautioned that a continued dearth of for-sale inventory and some slowing in customer traffic might slow momentum in the market.

"I just think that rates are heading up a little bit, the hectic buyers that were out there, a lot of them have bought," Rodgers said. "There still is some demand, but I think it is going to be slowing.

"[It's] more than a professional hunch, you don't see as many appointments on properties that you were seeing. It's not slowing drastically. There is just not the panic that was going on before with four or five bids on one property."

But O'Conor remained highly optimistic.

"I'm looking back in the [late] 1980s; obviously the market was pretty good then, too, but you would have months where you would have your early spring turnup and then the hot summer slow down, come back in the fall this [market] is just boom, boom, boom, up and up. Seasons don't mean anything anymore to people."

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