Around the country and at both ends of the Bay State, the buzz in the residential real estate industry is about condominiums, while condo sales in the rest of the state remained flat.

The National Association of Realtors earlier this month released figures that showed condominium sales nationwide rose by more than 9 percent in the first quarter of 2000 over the same three-month period a year earlier.

Condo sales in the first quarter totaled an annualized 725,000 units nationally – the highest quarterly sales rate since the NAR began to track condo sales in 1981. The figure represents a 5.5 percent raise over the 687,000-unit pace in the fourth quarter of last year, and a 9.4 percent raise over the 663,000 units sold in first quarter in 1999.

Regionally, sales of condominiums in the Northeast fell slightly according to NAR.

According to Warren Information Services, a sister company of Banker & Tradesman, Massachusetts sales were up slightly, with 4,416 units sold in Massachusetts in the first quarter of 2000 – up 1.4 percent from 4,354 for the first quarter of 1999. WIS figures include both Realtor and non-Realtor-linked transactions. Massachusetts Association of Realtors figures show a 3.9 percent decline statewide.

According to real estate agents, however, a strong interest remains in the Massachusetts condominium market, and officials say the primary reason for any decline is a simple lack of inventory to sell.

“I think the real story here is that sales didn’t drop more than they did,” said Fred Meyer of University Real Estate in Cambridge and 2000 MAR president, “given the drop in inventory and the jump in interest rates. If someone had seen figures for what interest rates would be and what inventory would be and was asked to predict sales, I don’t think they would have said we would do as well as we did.

“That shows my members are out there working hard with what they’ve got,” he added.

Meyer said decreases in various regions of the state – including a 47.8 percent drop in MAR’s Southeast region – could mostly be attributed to the lack of inventory. Two of MAR’s seven regions bucked the statewide trend, however.

On Cape Cod, Realtors reported a condominium sale increase of 11.8 percent in the first quarter compared to last year’s first quarter, and Western Massachusetts saw a 58 percent surge from the first three months of 1999.

WIS figures differ from MAR’s for Western Massachusetts and the Cape, but show a similar trend. WIS reported a 23.7 percent total increase over 1999’s first quarter for Hampden, Hampshire, Berkshire and Franklin counties. Barnstable County’s condo sales rate was up 22.6 percent for the first quarter of 2000.

Raymond P. Authier of Realty World Authier in Chicopee and president of the Greater Springfield Association of Realtors is experiencing the Western Massachusetts condominium craze first hand as the developer of a number of projects.

“I just got finished adding 12 more [units] to one of the developments,” he said. “I don’t even have the model unit set up yet, and I’ve already gotten five deposits.”

Communities in Western Massachusetts are home to a number of retirees or people near retirement age, which factor into condo sales, Authier said. “When Congress passed the capital gains law a few years ago, a lot of people decided to sell their house and go into a condo. That was a big factor,” he said. “It took a while for the trend to reach us, but we always come back a year after the rest of the state.”

Also, because areas like the southern Berkshires are magnets for second home owners, Pamela Roberts of Roberts & Assoc. Realty in Lenox said condominiums prove to be a popular choice because of fewer maintenance hassles.

“They like the simplicity of low-maintenance,” Roberts said. “They like to know that if they buy a home, they don’t have to worry about it when they’re away or they don’t have to worry about minor repairs.”

Roberts added that resorts like Cranwell Resort in Lenox have several condominium units under construction and under agreement, which will push the Western Massachusetts condo sales figure even higher once all of the sales close.

Authier said he has seen more younger buyers in the market that have households that find condominiums more attractive. “When I first started out, you never saw a homebuyer under 30, but it’s not like that now,” he said.

Meyer said the increases seen in Western Massachusetts could also be attributed to more available land on which to build and, consequently, create more inventory.

“In the west, you’ve got the land to build, and where there’s land to build, you naturally expect sales to be higher,” Meyer said.

“I don’t know what planning boards put people through in other communities, but where I work, if the developer has planned well, they work with him. We think we’re filling a void for housing in the area,” Authier said.

‘Increased Acceptance’
At the other end of the state on Cape Cod, Paul Grover of Kinlin Grover/GMAC Real Estate in Osterville said it is turnover, not a plethora of new inventory, that has resulted in the Cape’s high condominium sales rate.

“Every year we get more people who say ‘We’re spending more time in Florida now,” so they want to move from their big house to a condo, or move from a big condo to a smaller condo,” Grover said. “I don’t think it’s because we’re building new units. I think Osterville has had one new project in the last 10 years. There’s just not a lot of room for condos on the Cape.”

Like in the Berkshires, Grover said Cape buyers in the second home market are also looking for a lower-maintenance living option they don’t have to worry about when they’re away from the area. “Many buyers are seasonal buyers,” he said.

Grover echoed Meyer’s feeling that condo sales would be up in other regions if there were available inventory. “I know a lot of brokers up in the Boston area, and believe me if they had the condos available they’d be selling them all,” he said.

“Overall, I think there’s been an increasing acceptance of condos by middle-income homebuyers,” Meyer said. “People see what’s out there and now they’re more willing to settle for a condominium, although the dream of the American family is still to own a single-family home.

“But in Cambridge, even if you have a million dollars you can’t get that anymore,” he said.

Statewide, WIS reported that the median condo sales price increased from $124,000 in the first quarter of 1999 to $138,000 in 2000, an 11.3 percent increase.