Metro-area home sales hit a fast, furious pace

Buyers bid earlier, higher in tight market

March 26, 2001|By Laura Vozzella | Laura Vozzella,SUN STAFF

The Baltimore area's sizzling real estate market has turned home-buying on its head.

Some would-be buyers have abandoned the poker-faced approach and are tipping their hands, offering contracts with "escalation clauses" that promise to top competing bids by $1,000, $5,000, or even $10,000.

Some sellers have reversed the traditional contract contingencies and are accepting offers on the condition that they find a new house for themselves.

And though the list price remains a starting point for negotiations, these days the haggling often goes up, not down. Houses are selling well above the asking price in the hottest neighborhoods, from the Annapolis waterfront to Columbia's River Hill to Baltimore City's Canton, Federal Hill and Roland Park neighborhoods.

In metropolitan Baltimore - where sales rose steadily last year and jumped 46 percent last month over the previous February - forget the adage "buyer beware." The new rule is "buyer be fast." Some bidders are forgoing inspections and even buying properties sight unseen to beat the competition.

"You have to get more creative in this market to be successful," said Realtor Creig Northrop of Long & Foster. His Ellicott City office recently used a high-tech approach to close a deal quickly while prospective buyers were on a weekend trip to Las Vegas.

Another real estate agent from that office, Kimberly Kepnes, took digital photos of an Elkridge house the day it went on the market and e-mailed them to Robert and Anne Spar in Las Vegas. The Spars pored over the pictures on a computer in their hotel room and got an audio tour as Kepnes walked through the house with a cell phone. They faxed an offer that day.

It was one of three bids at or above the asking price that the seller received that day for the four-bedroom home, which backs onto the Timbers at Troy golf course and listed for more than $300,000. The Spars won with a $2,500 escalation clause and ended up paying $4,400 over the list price.

"That was the biggest gamble we took in Vegas," said Robert Spar, 37, a Baltimore lawyer who said he was pleased with the house once he got to see it in person.

While home sales rose just 0.4 percent nationwide in the fourth quarter of 2000, they were up more than 12 percent in Maryland, according to the National Association of Realtors. More telling than the volume of sales is their speed: It took an average of just 56 days to sell a house last year in Howard County - down from 157 days in 1997, according to Metropolitan Regional Information Systems Inc., the multiple listing database used by real estate brokers. Nearly 60 percent sold within a month.

Some areas are hotter than others. Though regional sales rose in 2000, they slipped in Baltimore, Anne Arundel and Carroll counties. But the average price of homes in metropolitan Baltimore rose 2.97 percent to $158,727 last yea. In some neighborhoods prices have soared; Chris Raborn of RE/MAX sold a house in Homeland for $189,000 and a year later sold it again for $230,000. In popular Eldersburg developments such as Harvest Farms, homes that went for $180,000 to $190,000 in 1995 are selling for $250,000 or more.

With the area's unemployment rates below the national average, mortgage rates low and prices still a bargain compared with those in nearby Washington, the metropolitan Baltimore housing market has no shortage of buyers.

"It's amazing," said Kay Deitz, who runs a real estate firm in Harford County, where home sales have increased 20 percent over the past five years. "Very few people are holding back. I think there is just a real good sense about jobs. You don't hear worry about jobs."

But the boom has depleted the supply of active listings by about a third in the past two years, according to Metropolitan Regional Information Systems.

Bill Holman, manager of Long & Foster in Hampstead, said his office is accustomed to handling 60 to 70 listings at a time. His inventory began to decline two years ago, dropping to 25 listings or less two months ago. It hasn't rebounded since.

Holman's agents are canvassing their areas every six weeks with phone calls, e-mails and mailings to let homeowners know there are potential buyers available, should they decide to sell. They used to canvass every three months or so.

"Sellers are having a heyday and buyers are frustrated," said Isabel Harman of O'Conor, Piper & Flynn-ERA in Catonsville. "Agents are frustrated, too, because we can't help them."

Carolynne Shumate of O'Conor Piper was so determined to help a buyer find a home that she took him on a tour of Roland Park and told him to pick out what he liked - even if the homes weren't for sale. He selected 46.

Shumate wrote letters to all 46 homeowners asking if they would consider selling.

"We drove around and he said, `I like you and you and you,'" she said. "Then I got out my personal stationery and wrote letters saying, `My client liked what he saw from the street, and this is what I'm offering.'"

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