Low Rates Help Condo Sales Rise 10% in 2002

Sales of condominiums and cooperatively owned apartments set a national record in 2002 as mortgage rates fell to the lowest levels in almost four decades, the National Assn. of Realtors said Wednesday.

Sales rose 10% to 824,000 from the previous record of 746,000 set a year earlier, the Washington-based trade group said.

The annualized sales pace in the fourth quarter was 818,000, 14% higher than the year-earlier period. The 30-year fixed mortgage rate averaged 6.08% in the quarter, the lowest recorded by mortgage company Freddie Mac.

Although the trade group didn’t break out annual figures by state, other reports show that the condo market has been particularly strong in California. In December, sales of condos in the state jumped 24% from a year earlier, compared with a 21% increase for single-family homes, according to the California Assn. of Realtors.

The rise in sales of condominiums reflects demand from first-time buyers who wanted to take advantage of the low mortgage rates but couldn’t afford a house, said Cathy Whatley, president of the national Realtor group. Because of that demand, condominium prices appreciated at a faster pace than single-family homes.

The median, or midpoint, price for condos was $137,100 in 2002, 11% higher than a year earlier. The median price for a single-family home was $158,300, up 7.1% from 2001.

The average rate for a 30-year fixed mortgage was 6.54% in 2002, down from 6.97% in 2001, Freddie Mac said.