THE CONVERSATION goes back to last summer, when Carolyn Krysiak campaigned for re-election to her House seat out of Southeast Baltimore. As she marched through the area's rowhouse neighborhoods each day, she saw the city sometimes waging war against itself.

"You see this pattern," she said one afternoon. "You see five houses, and two of them are boarded up. But the other three, they're being rehabbed."

Her voice seemed to sing a little as she got to the last part. Behind the boards of deserted houses, the city dies a little bit, one defeated street after another. But every time the rehabbing commences, so does renewal. There's a weird contrapuntal music in the air: the hammering and clopping of old homes being made new again, and young people bringing energy into defeated neighborhoods. But it's played against an unsettling background chorus of gunfire off in the emotional distance.

Two nights ago, Krysiak was talking about it again. The subject was the housing market. Glorious, Krysiak said. Exciting in ways that everybody said would never happen again. She was running out of her house to meet some constituents, and she mentioned gatherings at the Southeast Community Organization meetings on Wolfe Street.

"It used to be uncomfortable there," she said. "You know, 'Will there be trouble outside?' But not now. Nobody talks about that now."

But then, yesterday in the morning newspaper, came the reminders of nervous roadblocks that remain across the whole city. Months after the shooting of a 10-year-old boy during a west-side gunbattle last summer, the key witness in the case is shot eight times in his head and legs.

This follows two highly publicized cases gone bad. The city still reels from the firebombing of the Dawson family's Preston Street home. Seven were killed, reportedly for refusing to cave in to drug dealers. A few weeks ago, prosecutors dropped a murder charge against the man accused of killing scholar-athlete Rio-Jarrell Tatum last spring. Nobody reliable wants to talk.

Against such a background, people pack their bags. Doors are closed, and sometimes boarded up. But it's an old urban pattern: Parts of cities decay, and parts are reborn. The dying places nurse their wounds for a while, and then return to the living.

"We've seen this coming for some time," Krysiak was saying now, "but people didn't believe it at first. You saw all the rehabbing of houses in Canton, for example. And people said, 'Great, but it'll never go north of O'Donnell Street.' Then, when it kept going, they said, 'Great, but it'll never go north of Fait Avenue.' And then, when it kept going, they said, 'It'll never go north of Eastern Avenue.' And look how it's beyond Eastern Avenue now."

Part of Eastern Avenue borders Patterson Park. To the park's east, Highlandtown's business district shows encouraging signs of life: the coming rebirth of the old Patterson Theater as an arts center, the building of a library a few blocks away, new business life.

Just west of the park is Butchers Hill. Four years ago, the average house there sold for about $69,000. Today, nearly $160,000. To the south, waterfront neighborhoods -- Canton and Fells Point, Federal Hill and Locust Point -- have been booming for some time.

But the signs of life are broader than that. October home sales in the city were up 12 percent over a year ago, according to the Metropolitan Regional Information System's real estate trend indicator. Over the first 10 months of the year, 7,193 homes were sold in the city. In Reservoir Hill, on the west side, where there's renovation on almost every block, the Department of Housing and Community Development quietly put six vacant houses on the market. They got 350 proposals. Across the city, average sale price is up 15 percent, to more than $96,000.

But the city still wages war against itself. For all the buying of homes, thousands more remain vacant. Many are now owned by municipal agencies.

"What we have to get across," Krysiak said, "is the availability of help. If you want a loan, you can get it. These agencies will work with you, they'll help you get your finances in order. There's so much help available today, and with the equity, it's cheaper to buy than to rent. That's what these young people are discovering. And that's where you have this great excitement in so many of the neighborhoods, this" -- she searched for a moment for the right word. "This romance."

Romance?

"Yes," Krysiak said. "What's more romantic than starting your own home, and building a life?"

It's the life of young people, and it's the life of old neighborhoods beginning to develop youthful muscle again.