Sales o fCondos, co-ops set new record in 1999

Existing condominium and cooperative sales rose to unprecedented levels in 1999, setting a new annual record, according to a Feb. 1 release from the National Association of Realtors.

The total number of condo and co-op resales was 677,000 units in 1999, the highest since NAR started tracking this segment of the housing market in 1981, and was 12.1 percent higher than previous record of 604,000 units recorded in 1998. New annual records were posted in every region of the country.

The seasonally adjusted annual rate for existing condo and co-op sales during the fourth quarter of 1999 was 613,000 units. This level of activity was 14.9 percent below the record pace of 720,000 units set in the third quarter of 1999, but was 7 percent above the 573,000-unit level recorded in the fourth quarter of 1998.

"The surge in sales of condominiums and cooperatives experienced earlier in 1999 clearly helped boost this segment of the market to another record level for the year," said NAR President Dennis R. Cronk. "Despite a year of rising interest rates, many positive economic factors have remained in the market to entice both first-time buyers and people trading down to simpler lifestyles," Cronk said.

"Rising income levels and moderate increases in prices of condos and co-ops, for example, are two of the top factors that can be attributed to continued healthy affordability conditions," Cronk added.

The national median price of existing condominiums and co-operatives was $110,400 during the fourth quarter, an increase of 8 percent from the same period a year earlier.

Dr. Fred Flick, NAR's vice president of economic research, said the decline in sales of condos and coops in the fourth quarter compared to the previous quarter is typical of a market on the backside of a surge.

"A better gauge of activity is reflected in the sales figures for the entire year. The huge increase in sales of condos and co-ops in 1999 reflect(s) a continued strong demand by buyers across the board," Flick said.

Regionally, though the market experienced varied declines in sales in the fourth quarter compared to the previous quarter, the year-to-year increases were strong enough to help shatter the 1998 record, Flick said.

The strongest increase regionally was in the South, where condo/co-op resale activity rose 12.7 percent in the fourth quarter, compared to a year ago, to 267,000 units.

Despite a drop of 13.3 percent in sales in the fourth quarter compared to the previous quarter, sales in the South rose 16 percent to 289,000 in 1999 compared to 1998.

The median price in the South was $83,900 in the fourth quarter, which was 4.2 percent higher than a year ago.

In the Midwest, condo/co-op resales rose 6.7 percent in the fourth quarter, compared to a year ago, to an annual rate of 80,000 units.

Sales of condos and co-ops in the region dipped 2.4 percent in the fourth quarter, however, compared to the third quarter.

Resales totaled 81,000 units in the Midwest in 1999, up 11 percent compared to 1998. The median price in the Midwest was $120,100, up 11 percent from a year earlier.

Existing condo and co-op sales in the West rose 1.8 percent in the fourth quarter, compared to a year ago, to a level of 166,000 units. Sales in the region rose 6.7 percent in 1999, compared to 1998, to a total of 190,000 units, despite a 22.8 percent drop in sales between the third and fourth quarters of 1999. The median resale condo price in the West was $126,500, an increase of 0.5 percent from a year earlier.

In the Northeast, the sales pace of condos and co-ops rose 1 percent to 99,000 units in the fourth quarter compared to a year ago.

Though sales in the region fell 14.7 percent between the third and fourth quarters of 1999, they rose 12.5 percent to 117,000 units in 1999, compared to 1998. The median price in the Northeast was $120,000 in the fourth quarter, up 17.5 percent from a year ago.