Home sales rise 5% Area market stimulated by job confidence and mortgage rate fears

THE BALTIMORE SUN

A desire to beat rising mortgage rates and improved job confidence pushed buyers into the new homes market during the first three months of the year, boosting sales 5 percent in the Baltimore region, Legg Mason Realty Group said yesterday.

Builders sold 2,613 detached homes, townhouses and condominiums, up from the 2,493 sold during the first three months of 1995, Legg Mason said in its quarterly survey of communities of 20 homes or more.

Such an increase is healthy, given the harsh winter and several months of fluctuating mortgage rates, said Laura Preston, vice president of the Realty Group's Housing Market Profiles, which surveys builders in Baltimore and Baltimore, Harford, Carroll, Howard and Anne Arundel counties.

"I think the market is a little stronger than the 5 percent reflects," Preston said.

Still, the sales increase in the Baltimore area fell short of the mid-Atlantic region -- the Philadelphia and Wilmington areas and Washington, D.C. -- where first-quarter sales jumped 9 percent, she said. Strong sales of single-family homes in the Washington area helped drive the regional increase, she said.

In Baltimore, buyers of new homes sought affordability. Townhouse sales had caught up to single-family sales last year, and that trend has continued this year. In Baltimore -- like nowhere else in the mid-Atlantic region -- townhouse sales equaled detached house sales, each capturing 43 percent of the market, Legg Mason noted. Condominiums accounted for the rest of the sales.

"It has moved in that direction for some time," said Bob Coursey, marketing director for Ryan Homes. "A lot of that is due to the first-time homebuyer," who is taking advantage of flat sales prices, homeowner tax breaks and relatively low interest rates, which averaged 8.19 percent on 30-year, fixed loans as of Friday in the Baltimore region. "I would not want to be making a living selling $350,000-plus homes right now."

Most buyers -- 69 percent -- bought houses in communities with prices averaging less than $175,000.

Sales increased everywhere in the region but in Howard County, where sales dipped nearly 5 percent.

Anne Arundel counties captured the greatest shares of sales, because of brisk sales in Owings Mills and the popularity of planned communities with recreational amenities such as Russett, Seven Oaks and Piney Orchard in Odenton and Crofton.

For instance, 18 of the back-to-back townhouses at the Gables in Piney Orchard sold in March, far surpassing the three to five sales that typically make a good month, said Robert J. Lucido, president of Builder's 1st Choice, which markets that community and dozens of others in Maryland and Washington.

Lucido said builders expect February and March to be among the most productive months of the year, but "it was better than most first quarters. There is more job security out there."

At Ryan Homes' sales offices, "the people we're seeing in the models are upbeat," Coursey said. "They're making decisions quickly. They feel positive about housing as an investment."

The Legg Mason survey showed Ryan Homes dominating sales, with an 11.1 percent share of the region's market, followed by Ryland Homes, with 5.9 percent of the market and Pulte Home Corp., with a 5.2 percent share. Coming in fourth and fifth in sales were Bob Ward Homes and Trafalgar House Residential.

Pub Date: 5/07/96

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