- The Washington Times - Thursday, November 11, 2004

Eight months of new-home-sales data tell a familiar story of land shortages, competitive market conditions and very high prices. These are some of the reasons Washington-area new-home sales are down 13 percent this year — at least in the jurisdictions near the Beltway.

Much of the region’s new-home construction has moved outward, to distant counties in Southern Maryland, Western Virginia and even Pennsylvania. As a result, new-home builders captured only 15 percent of all home sales in the first eight months of the year. A decade ago, their share was 35 percent.

Much of the slowdown has occurred in Maryland, as the charts show.

Note how Virginia matched the decent sales of 2002, while sales in Maryland were lower by 2,000 sales.

Land shortages are largely to blame. Maryland has a water boundary to the east that limits how far development can spread from the District. The Virginia suburbs, lacking such a boundary, seem to stretch on and on, out Interstate 66 and down Interstate 95.

Compare Montgomery County to Spotsylvania County, for example. With little land available for residential development, new-home sales in Montgomery have been in decline for more than a decade. Sales in Spotsylvania this year, however, are the highest in history.

Affordability also contributes to the differences between these two counties. This year in Spotsylvania County, you could buy a 2,600-square-foot single-family home on a nice lot for a median price of $350,000.

In Montgomery County, a 1,500-square-foot condominium will run you $385,000.

If you really must have a single-family home in Montgomery, be prepared to pay $640,000 — the median price for a single-family home this year in that increasingly exclusive county.

Chris Sicks

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