Condos, co-ops continue healthy sales trend

The National Association of Realtors announced Aug. 3 that sales of existing condominiums and cooperatives slowed during the second quarter but the sales rate still exceed sales for the same period in 1999.

NAR reported that the seasonally adjusted annual rate for existing condo and co-op sales during the second quarter was 675,000 units, down 1.3 percent from 684,000 units in the first quarter.

However, this figue was up 0.4 percent from the 672,000 units recorded in the second quarter of 1999.

"Essentially, increasing condo sales in the South and Midwest were offset by declines in the Northeast and in the West," said NAR President Dennis R. Cronk, in a press release.

"Higher interest rates appear to be taking a greater toll in the high-cost regions, where some first-time buyers are being priced-out of the market," he added.

The NAR referred to Freddie Mac figures which show the average commitment rate on a 30-year conventional fixed-rate mortgage was 8.32 percent in the second quarter, up from 8.26 percent in the first quarter and 7.21 percent in the second quarter of 1999.

Meanwhile, prices for condo and co-op units are showing stronger-than-typical increases.

"The median existing condo price in the second quarter was $113,800, which is 6.1 percent higher than a year ago. This is much stronger than the increase we're seeing in single-family home prices," said Dr. Fred Flick, vice president of economic research for NAR.

By comparison, the median price of existing single-family homes during the second quarter was $137,800, up 3.2 percent the second quarter of 1999.

"Stronger condo price increases appear to result, in part, from increasing sales at the upper end of the market, as empty-nesters move into units featuring a wide array of contemporary amenities," Flick said.

In the South, condo and co-op resale activity rose 4.6 percent from the first quarter to 295,000 units in the second quarter, 3.1 percent higher than the same quarter in 1999.

The median price for condos and co-ops in the South was $89,400 4.7 percent higher than a year ago.

Existing condo and co-op sales in the Midwest rose 1.2 percent from the first quarter to a level of 84,000 units, 5 percent higher than the second quarter of 1999.

The median resale condo price in the Midwest was $122,300 7.4 percent higher than a year ago.

In the West, the sales pace of condos and co-ops dropped 6.1 percent from the first quarter to an annual rate of 185,000 units in the second quarter; 0.5 percent higher than the sales rate during the second quarter of 1999.

The median price for condos in the West was $140,500 8.1 percent higher than a year ago.

In the Northeast, condo and co-op resales fell 8.2 percent to 112,000 units between the first and second quarters; 8.2 percent below the second quarter of 1999.

The median price for condos in the Northeast was $112,000 1.4 percent higher than a year ago.