Despite pessimistic forecasts about the local economy, sale of new homes in the Baltimore area remained relatively strong during the first half of 1990, especially compared with nearby cities where sales have dropped sharply, according to Housing Market Profiles, a comprehensive market study by Legg Mason Realty Group.
Moderately priced condominiums continued to sell well, with six of the area's 10 best-selling projects falling into that category, according to the report. Town houses accounted for the other four projects in the Top 10, marking a continuation of a trend in which the traditional detached suburban house is losing market share to attached and multifamily housing.
Howard County was the only jurisdiction in the Baltimore metropolitan area where new-home sales dropped sharply, and that fall is largely due to a county-imposed cap on the number of building permits issued.
"The news is not as bad as we initially thought it might be," said Robert Lefenfeld, vice president for information services for Legg Mason Realty. "Basically, sales were down in the second quarter of 1990, with 2,230 sales reported. That was down 21 per
cent compared to a surprisingly strong first quarter and down 15 percent from the second quarter of 1989."
But if the sales activity in Howard County is deducted from the figures, sales throughout the rest of the area were actually up 8 percent during the first half of this year, compared with the same period last year, he said. Even including Howard County figures, area sales for the first half of the year were down only 5 percent from area sales in the first half of last year, Mr. Lefenfeld said.
"Overall, the area has remained relatively stable," he said. "We're not in a growth mode. ... But we're in much better shape than the Washington, D.C., market, which has had serious deterioration in sales. And we're doing better than the Philadelphia and Wilmington markets."
Sales in the Washington market during the first half of this year were down 42 percent from the same period of last year. Sales in the Philadelphia market were off 9.2 percent during the first half of this year, as opposed to the same period last year. Second-quarter sales in Philadelphia dropped 21 percent from sales in the first quarter, and in Washington, second-quarter sales were
See HOT HOUSES, 7J, Col. 1 HOT HOUSES, from 1J
down 46 percent from the first quarter, Mr. Lefenfeld said.
He and his associates at Legg Mason said sales in the Baltimore area didn't drop as much as they did in Washington or Philadelphia because the Baltimore market was never as "overheated" as those markets were.
Also, they said, the area's steady growth and diversified economy help buffer it from economic downturns that can have more severe effects on areas dependent on a few industries, such as Boston with its high-technology corridor or New York with Wall Street.
"It's a question of extremes and how far the extreme is away from the center," said Legg Mason Realty senior associate Fritzi Kolker. Other markets, including Washington, Boston and New York, "had farther to fall," she said. "We've just never been that wild."
"We were not as overheated or overblown or as single-industry-dependent as those other markets," Jerry Doctrow, Legg Mason Realty's vice president for research services, said. "We're closer to the national norm."
Legg Mason Realty Group is one of the only local companies to study the market to monitor demographic trends and other changes that affect homebuyers and builders.
Figures for the first half of this year are based on information compiled by Housing Market Profiles project director Kate Weglein, with sales statistics supplied by the builders themselves. The study includes all active for-sale residential properties in subdivisions of 20 or more units in Baltimore and Anne Arundel, Howard, Carroll, Baltimore and Harford counties. It does not reflect construction and leasing of rental apartments or custom housing.
According to Legg Mason Realty, the top 10 growth areas during the first half were Edgewood/Joppa, with 654 sales; Bel Air/Fallston, 546; Ellicott City, 293; Crofton, 253; Pikesville, 244; Perry Hall/White Marsh, 243; Reisterstown/Owings Mills, 225; Elkridge, 188; Westminster, 154; and Columbia, 145.
The best-selling community in the first half was Henderson-Webb's Rainflower condominiums in the Sparks-Glencoe area of Baltimore County. The development sold units at an average base price of $105,100.
Other communities in the top 10 were Montgomery Run in Ellicott City by Macks Homes, with 63 sales; Woodbridge Center in Edgewood by H. Carl Stephen Inc., 62; Cromwell Fountain in Glen Burnie by FJS Builders, 60; Laurel Woods in Abingdon by Ryan Homes, 59; and The Pointe in Abingdon by Hendersen-Webb, 59.
Also, the Tiers of Walden in Crofton by the Barrington Group, 57; Carrollwood Manor in Middle River by Washington Homes, 55; Woodbridge Center in Edgewood by Ryland Homes, 54; and Chestnut Hill Cove in Glen Burnie by Ryan Homes, 53.
The two top-selling homebuilders in the Baltimore area continued to be Ryland Homes and Ryan Homes during the first half of this year, according to Legg Mason Realty.
In Housing Market Profiles, the firm said that Ryland Homes sold 513 homes in the Baltimore area during the first half, while Ryan sold 482. Ryland's figures represent 10
percent of the total new-home sales market in the area, and Ryan's figures represent 9.4 percent.
Rounding out the top five in the Baltimore market were: NV Homes,
with 238 sales representing a 4.6 percent market share; Hendersen-Webb, with 224 sales for 4.4 percent; and Macks Homes, with 146 sales for 2.8 percent.
In sixth place was Winchester Homes, with 145 sales and 2.8 percent; followed by Capital Homes, with 122 sales and 2.4 percent; Masonry Contractors, with 103 sales and 2 percent; and Pulte Homes and Washington Homes, each with 101 sales for a 2 percent share.
Other findings of the report were that:
*The July 1 median base price for a new residence in the Baltimore region was $165,612, a 1.4 percent increase over April and a 7 percent increase over January.
*With the introduction of relatively expensive town houses in Anne Arundel and Howard counties, the median base price of town houses in the Baltimore region has increased 5.9 percent since April 1, to $121,234.
*Pricing of single-family detached housing remained relatively flat, with a 0.5 percent increase over the April median price. As of July 1, it was $199,150.
*With the introduction of affordable multifamily housing in Harford and Baltimore counties, the median base price of new multifamily housing in the region dropped 1.7 percent from April to July, reaching $103,325.
*Howard County remains by far the most expensive county in the region with a new unit median base price of $235,900, $38,000 more than the median base price in the next most expensive jurisdiction, Anne Arundel County.
*Baltimore City is the most affordable jurisdiction in terms of new-home sales, with median base
prices of $124,200 for town houses and $104,500 for new or recently converted multifamily projects.
*Some of Howard County's slowdown must be attributed to its proximity to the Washington housing market, which has been in "a more severe slowdown" than the Baltimore market.
*With 445 sales in the second quarter, Anne Arundel sales are actually up 6 percent, compared with the average quarterly sales level since January 1989. With 586 sales registered during the second quarter, Harford County was 1.5 percent above its quarterly average. Second-quarter sales in Baltimore County were down 10 percent from their quarterly average, while Carroll
County sales were down 8 percent.
As a sign of the market's continued strong activity, Legg Mason analysts pointed out that 60 new developments have opened for sales since April 1. Twenty of them were in Anne Arundel County, where several large developments have begun sales, and a number of communities in Crofton began marketing housing that recently received sewer service.
In Harford and Carroll counties, projects introduced during the second quarter were on average more expensive and larger than those already on the market. In the city and Anne Arundel, Baltimore, and Howard counties, new projects were on average smaller and less expensive than those already on each market.