Condominium demand expected to increase

Market: Builders are designing complexes with amenities to lure empty-nesters and buyers priced out of other housing options.

August 08, 2004|By Sara K. Clarke | Sara K. Clarke,SUN STAFF

From development to marketing to sales, the condominium culture in the Baltimore area is changing, with more inventory for consumers to choose from and builders offering more amenities to stand out in this growing field.

The condo market remains sound, real estate agents say, but its hectic pace has calmed in certain areas. The demand for condominiums is expected to keep rising, however, in light of higher home prices and baby boomers looking for maintenance-free living.

"Sales are not as brisk, but it's a healthy sales market," said Bill Cassidy, a Baltimore agent with Long & Foster Real Estate Inc.

And condos are gaining ground as an affordable housing option compared with single-family homes. With first-time buyers from Washington and Baltimore competing for houses, condos are still selling fast in places such as Ellicott City and Columbia, agents said.

"In the city, you can buy a nice condo for $200,000, but you can also buy a rehabbed row home for $200,000," said Rob Kinnear, an agent with ReMax who works in Ellicott City and Elkridge. "There aren't as many options in Ellicott City as there are Baltimore City."

Kinnear said condominiums for sale often attract four or five offers and have been selling for more than the asking price. Condominiums at Woodland Village in Ellicott City, which sold for $150,000 to $190,000 at this time last year, now cost $230,000 to $260,000, Kinnear said.

Condo prices in the Baltimore area are up more than 30 percent since they started climbing four years ago, according to statistics from Metropolitan Regional Information Systems Inc., the Rockville-based listing service used by brokers and agents. The company groups condominium sales with ground rents and cooperatives. Last year, there were 10,062 sales in that category in Baltimore and its five surrounding counties, compared with 6,818 in 2000.

During the first six months of this year, Harford County led the area in price increases for condos, cooperatives and ground rents, with an average selling price of $121,859, which is 31.1 percent higher than in the same period last year. Prices in Howard County averaged $186,121, which is 29.8 percent higher than in the first half of last year.

Baltimore's average selling price for the first half of the year was $95,353, an increase of 26.3 percent. Baltimore County had a 17.5 percent increase and an average price of $134,152. Anne Arundel County logged a 16.3 percent increase and an average price of $198,087. Prices in Carroll County grew 0.4 percent, with an average price of $157,577.

Sales of condominiums in Baltimore and its five surrounding counties grew 6.2 percent to 5,153 sold during the first six months of this year compared with the same period last year. Sales rose in Baltimore City and Harford County and remained flat in Howard, Anne Arundel and Baltimore counties. Sales fell more than half in Carroll County with 39 sold - the fewest condominiums in the region.

Nationally, sales of condominiums and cooperative apartments have risen more than 40 percent in the past three years, according to preliminary reports from the National Association of Realtors. The national market has posted records for condominium sales during each of the past eight years.

The condo lifestyle is popular with young professionals and older empty-nesters.

First-time homebuyers are embracing condos more readily than they did 25 years ago, said Anne Cooke, a real estate agent with Coldwell Banker in Columbia.

"It's a lifestyle choice," Cooke said. "People are accepting the condo concept right now because it's affordable and it's homeownership."

Dan Grove bought his Columbia condominium two years ago after looking at about 40 condos and townhouses. He decided on a two-bedroom, two-bath condo in Harper's Choice priced at $101,000.

"It was all I could afford at the time," Grove said. "It seemed to be much easier to find a condo than to find a house in my price range and in the market."

Grove was afraid prices had peaked when he bought his home, but he was pleasantly surprised when his condo's value steadily rose. It's now worth about $185,000.

"I love it. It's great, especially in the winter when I don't have to shovel," Grove said. "I don't have to worry about anything on the outside."

Low maintenance for condominiums allows professionals to travel a lot, said real estate agent Carolynne Shumate.

"They come home after a long day and there's 50 restaurants up the street," Shumate said of the younger crowd.

Amenities often include front-desk security and reserved parking. Condominium owners must pay monthly fees for such amenities. Fees vary by building, but usually are based on square footage and the amenities included. Costs can range from $80 to $1,000 a month.

More important, perhaps, are the older buyers. As the baby boom generation takes full advantage of condominium living, its needs could alter the market.

Diane and Robert Mathieson are two of the many empty-nesters turning to condo life.

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