New home sales varying widely Differences: Sales are slow at the high-end of the market, but affordable homes are moving well.

THE BALTIMORE SUN

In the fanciest new neighborhoods, builders are straining to sell a home every month or two. But in less pricey ZIP codes, low-end condos and townhomes are selling one or two a week in some developments.

Although the Baltimore region's new home sales have shown signs of recovering from their early 1995 doldrums, the state of the market still varies widely from one locality and market segment to another.

Overall, sales of new homes were 16 percent higher in the third quarter than in the same period last year, a relief for builders who watched sales dive in the first quarter.

Also, the average price of new homes for sale, at $173,520, is nearly 3 percent higher than it was a year ago, according to Legg Mason's Realty Group, which publishes quarterly studies of the region's new residential construction.

But Baltimore-area builders say they are experiencing an uneven market. Builders in some segments and some neighborhoods are seeing rising sales. For example, Anne Arundel, Baltimore and Carroll counties are seeing improvements in numbers of sales over last year. Other areas, such as Harford and Howard counties, are slumping.

Entry-level homes -- the so-called "affordable" segment -- seem to be selling well while more expensive new homes are moving slower.

"The resale market is not that strong," said Martin K.P. Hill, president of Masonry Contractors, the leading builder in Carroll County. So there are fewer buyers who, having sold their homes, can move to the most expensive segments of the market.

"Our focus is on the affordable segment," noted Mr. Hill, and business is "gangbusters."

"November, traditionally the bottom falls out. But our pace through November is very strong," he said.

More than half the region's new home sales in the third quarter were under $150,000, mostly townhouses, condos, and some detached homes.

According to Legg Mason, only 10.8 percent of sales were above $250,000, despite 23 percent of the new-home subdivisions being priced in that segment. Only one of what Legg Mason identified as the top-selling detached home communities in the region was selling at an average base price over $250,000. That was Ryland Homes' Pointers Run in Howard County, averaging $263,786. But most sales this year by Ryland -- the region's top seller of new homes -- are priced substantially less. The company's average sales price is $152,573.

Anne Arundel is still the hottest market in the region, with 29.7 percent of the new home sales in the third quarter, in large part because of the Odenton-Crofton area. Sprawling planned unit developments are attracting buyers commuting to Baltimore, Washington and Annapolis. In the third quarter, sales of new homes in Arundel jumped by 43 percent over the year-earlier period.

Townhouses continue to dominate Anne Arundel new-home sales, accounting for 46 percent of the sales, one of the highest percentages in the region.

Townhouses have been most popular in the $125,000-to- $150,000 range (51.1 percent), while condos are selling best in the $75,000-to-$100,000 segment in Anne Arundel (54.4 percent), according to Legg Mason.

The most popular price segment for detached new homes in the county is the $225,000-to-$250,000 range, with more than 24 percent of the third-quarter sales.

While Anne Arundel is one of the strongest markets, it is also one of the most competitive. Ryan Homes leads with 8.3 percent of units sold from January through the end of September, with Regency Homes second at 6.6 percent, Ryland Homes at 5.8 percent, and Pulte Home Corp. and U.S. Home Corp. tied at 5.6 percent.

Builder Robert Libson, president of the Sylmar Corp., says there are many more subdivisions under construction than a decade ago.

"There's a lot more choice out there for buyers. That makes you work harder," Mr. Libson said.

Baltimore County continues to see its share of the new housing market decline from more than 30 percent of sales at the beginning of this decade to below 28 percent in the third quarter, as Anne Arundel has charged past. Still, increases in the Owings Mills and White Marsh growth areas increased third-quarter Baltimore County sales over last year by nearly 12 percent.

"Owings Mills is extremely competitive," said Wanda Cross, a Ryland marketing executive. According to Legg Mason, the new townhome villages in northwest Baltimore County have more unsold units than any other section of the region.

"All of the big builders are in townhomes," said Brooks Palmer, executive vice president of Trafalger House Residential.

As in Anne Arundel, townhomes lead Baltimore County new home sales. More than 47 percent of all new unit sales were townhomes in the third quarter.

Overall, Baltimore County buyers were hitting lower price ranges for townhomes and detached homes compared with Anne Arundel, according to the Legg Mason survey. Half the townhomes (50.2 percent) sold in the $100,000-to-$125,000 range; the most popular range for detached homes was $150,000 to $175,000 (21 percent). Condo sales in Baltimore County were most popular in the $75,000-to-$100,000 range (52.3 percent), virtually the same as in Anne Arundel.

But in north central Baltimore County, builders are trying to sell some of the most expensive homes in the region; half the homes sold exceed $300,000. These include Seminary Overlook, where Landmark Homes, Richmond American and Talles Homes are building residences ranging from the low $300s to the low $400s.

"We're doing relatively well," said Larry Pryor, sales manager for Landmark. He said the market has been unpredictable; projects in different counties and price ranges have tended to get hot and cold at different times.

Year-to-date sales of detached homes in north central Baltimore County had been running ahead of last year, but in the third quarter, they dropped by one-third, according to Legg Mason. Part of the reason is that many communities are being completed and no new detached subdivisions are being opened, according to the survey.

The Baltimore County market is led by three builders: Ryland (12.5 percent), Ryan (12.3 percent), and Pulte (10.6 percent).

Carroll County continues to boost its share of the new homes market, driven by construction of some of the most affordable homes in the market.

Since 1991, Carroll, the least populous county in the Baltimore region, has doubled its share of the area's new construction, from roughly 5 percent to 10 percent, largely through sales of detached homes. More than three out of every four new sales are detached -- the highest percentage in the region, according to the Legg Mason survey.

The most active category for detached homes is $150,000 to $175,000. That's in large measure due to the sales by the county's market-share leader, Masonry Contractors, which sold 23.3 percent of the county's new homes in the third quarter.

Masonry Contractors had two of the region's top-selling detached-home communities in the third quarter -- Eldersburg Estates, where the average base price is $157,366, and nearby Benjamin's Claim, selling for an average base price of $150,363.

But Carroll also had two other communities in the Legg Mason list of the top-selling detached subdivisions: Copperfield, in Taneytown, by Dan Ryan Builders ($143,160 average base price) and Eagleview, in Westminster, by Macks Homes ($170,490).

Fueling Carroll's growth to a lesser but still noticeable extent has been the development of higher-end subdivisions such as Finksburg's River Downs golf course community, where Shelley Custom Homes, Talles Homes and Ashley Custom Homes are building detached residences from the low $300s to the low $400s. In the Mount Airy area, the Challedon community is featuring homes in the $300s, built by Rylea Homes, H. Richard Jenkins and GYC Builders; and The Paddocks, with homes by GYC and Rylea, has homes in the $300s and $400s.

Harford County has seen its share of the new-housing market dip from nearly 20 percent in the third quarter of 1994 to around 16 percent, closer to its typical share in the 1990s.

Detached homes lead Harford's sales, with around 46 percent, while townhouses are around 39 percent and condominiums the rest.

The most popular segment of new detached homes is in the $175,000-to-$200,000 range, while new townhomes are selling best in the $100,000-to-$125,000 segment, and condos in the $75,000-to-$100,000 range.

In Harford this year, Ryland is the market leader, with a 16.8 percent share, but Bob Ward Homes is second at 12.5 percent and Ryan has 10.1 percent.

Company President Bob Ward says his projects are outperforming the market.

"We had a real slow first quarter," Mr. Ward said. "I just think it was buyer confidence more than anything else," he said. "But we've made up the ground since." Part of the reason is his firm's activity in the lower-priced end of the market. His average detached home sells in the low $150s, and he says his company's overall sales are now running 30 percent better than a year ago.

Howard County continues to be the most expensive locality in which to buy a new home. Sales continue to fall and its share of the region's market is declining, dropping from a peak of around 19 percent in 1994 to around 15 percent in the third quarter, according to Legg Mason.

No other county has as many detached sales in the $250,000-to- $275,000 range, (41 in the third quarter) and no county in the region had as many sales in the $350,000-and-over range (36 sales; by comparison, Baltimore County had 16).

Some of the homes are selling for over $500,000. Williamsburg Builders in the Hobbit's North, Pointers Run and Woodlot communities has dwellings priced in the mid-$500s.

"The market in the higher-end homes is very, very soft," said Robert R. Corbett, vice president of Williamsburg Builders.

Most buyers in the over-$400,000 market are households transferring into the market, he said. Local buyers for his homes are more likely to purchase in the upper $200s to mid-$300s, including move-up families from Montgomery County and older sections of Columbia. It's a segment that he said is "doing all right."

"This has become the bulk of our business in '95, and we anticipate it will be in '96," Mr. Corbett said.

But the most active Howard builders are selling in segments below Williamsburg levels. Ryland leads the Howard market with a 15.5 percent share, and the average price of its detached homes is $241,108, according to Legg Mason. Ryan is second, with 10.5 percent, and an average detached price of $180,946; and Trafalger House is third, with 8.2 percent and an average price of $257,034.

Baltimore City had 25 new home sales in the third quarter. Leading builders in the city include Ryland, Struever Bros., Eccles & Rouse, HarborView Properties and Scherr Homes. Through Sept. 30, 109 new homes have been sold this year in the city, including 62 townhomes, according to Legg Mason.

Top builders

The top 10 Baltimore area homebuilders for Jan. 1 to Sept. 30, 1995:

.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..Mkt

Builder .. .. .. .. .. .. ..Sales .. .. .. ..share

Ryland Homes .. .. .. .. .. .797 .. .. .. ...10.8%

Ryan Homes .. .. .. .. .. ...692 .. .. .. ... .9.4

Pulte Home .. .. .. .. .. ...369 .. .. .. ... .5.0

Trafalger House .. .. .. .. .198 .. .. .. ... .2.7

Universal Housing .. .. .. ..174 .. .. .. ... .2.4

Regency Homes .. .. .. .. .. 173 .. .. .. ... .2.3

Masonry Contractrs .. .. .. .168 .. .. .. ... .2.3

US Home .. .. .. .. .. .. ...155 .. .. .. ... .2.1

Patriot Homes .. .. .. .. .. 146 .. .. .. ... .2.0

Bob Ward Homes .. .. .. .. ..145 .. .. .. ... .2.0

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