If May's existing-home sales report is any indication, there is plenty of life left in Baltimore's housing market as sales rose 6.63 percent compared with the comparable period in 1999.
The market shook off a 10.15 percent drop in April and reversed a downward trend during the first part of the year to show its biggest month-over-month gain since August. And with pending sales, an indication of future activity, up 2.27 percent, summer sales should remain strong.
"I am surprised that those numbers exceeded last May," said Patrick Welsh, president-elect of the Greater Baltimore Board of Realtors. "With all the economic talk you hear about the economy slowing down, my expectation is that those numbers were going to be off. To see that they were up is certainly incredible. But I don't know how long we can maintain this pace."
Howard County sales were up 20.18 percent over May 1999 to lead the area, followed by Baltimore with a 19.11 percent increase.
Anne Arundel County was up 7.18 percent, Baltimore County rose 2.59 percent and Carroll County inched up 1.88 percent.
Harford County was the lone jurisdiction to fall, dropping 20.63 percent from the comparable period last year.
The increased sales also come in the face of rising mortgage rates, which several weeks ago flirted with 9 percent. But the continued strength of the economy is keeping buyers in the house-hunting mode. Last week, the average 30-year, fixed-rate mortgage in the Baltimore area was at 8.24 percent.
"I think the reason you are still seeing the tremendous activity is that consumer confidence is still up there, [and] the stock market settled back down again," said Arthur Davis, president of Chase Fitzgerald & Co. Inc. in Roland Park. "I don't think the rise in interest rates did much more than make people think I better jump on now before they really do get up to 9.5 percent.
"So I think you saw a burst of activity where people who were trying to really lock in [a mortgage] and get houses under contract while they were at a great rate."
And if higher rates failed to discourage buyers, so did higher prices.
The average sales price of a single-family detached home in the Baltimore area rose 6.79 percent over May 1999 to $212,096. A townhouse increased by 6.81 percent to $111,320.
But in the city, the average sales price hit $89,891 - 5.96 percent higher than May 1999 and perhaps one of the highest monthly averages ever. "I don't recall it ever getting that high," said Davis, who has sold real estate in the city for more than 30 years.
Davis said inventory in the city's most sought after neighborhoods in Roland Park, Guilford and Homeland continues to be scarce and that multiple contracts are still common. However, the frenzy that was evident a year ago has decreased.
"You are not seeing five contracts, but you are seeing three or two. The depth is not as quite as strong," Davis said, adding that other neighborhoods are benefiting from a "spillover effect" that is helping sales in other city neighborhoods.
Anirban Basu, director of applied economics at the Regional Economic Studies Institute at Towson University, agreed. "The city really is participating in this rally," he said. "The momentum has extended beyond the reach of the Inner Harbor and now [neighborhoods like Hamilton and Hampden] have their own momentum.
"That is a very good sign. Perhaps the foundation is being laid for a city to be great corner to corner. That couldn't be said two years ago."