Unusually mild February weather enticed prospective homebuyers to get a jump on finding a new home in the Greater Lehigh Valley. The region saw an 8.4 percent jump in pending sales with 132 more contracts signed compared to February 2016.
Combined with a 6.3 percent drop in new listings, that activity has contributed to a growing nationwide and regional trend.
“Overall, inventory is significantly down, something like 25, 30 percent from what we were,” said Salvatore “Sam” Ruta, manager for Prudential Choice Properties, Nazareth. “That’s causing some problems with buyers who want to buy.”
Real estate agents see that trend across the region.
“We’re the same as the rest of the country, that there is a shortage of inventory,” said Kent Hatter, broker with Re/Max 5 Star Realty, Orwigsburg, Schuylkill County.
The shortage may have contributed to fewer closed sales in February, which saw a 5.5 percent drop when compared to February 2016. Yet many agents see a glimpse of hidden benefits as the blizzard of 2017 melts into the history books.
“The residential market is pretty dynamic right now, especially in specific areas,” Ruta said. “Things are moving really quick. We are getting multiple-offer scenarios.”
NEW JERSEY, NEW YORK INFLUX
The Lehigh Valley saw 98 additional contracts signed in February – a 16.6 percent growth over the previous February – as buyers took action on the limited available stock. Sales were in all price ranges, in-cluding higher-priced homes.
Ruta said a return of buyers from New Jersey and New York contributed to that activity.
“Consumers out there are feeling pretty good with what’s going on,” he said. “The trends are there. Pending sales are up because of the market right now.
“You’re seeing a lot of people thinking spring and they are out there looking to buy property.”
Schuylkill County also sees a continuing recovery despite a 36.8 percent drop in closed sales, posting a modest 1.1 percent growth in pending sales February over February and a 20 percent increase in new listings.
“We have had quite a few multiple offer situations this year because of that lack of inventory …,” Hatter said. “If you have less supply and the demand is still there, that means the price should theoretically go up.”
Hatter sees lower inventory, economic conditions and consumer confidence contributing to the ongoing activity.
“It would be nice to see some positive growth. It would be good to see people’s real income go up,” he said. “A healthy economy is ideal for a healthy real estate market.”
GOOD LISTINGS WILL SELL FAST
Berks County agents also project a healthy real estate market with a 5.1 percent boost in pending sales and a 0.4 percent drop in new listings.
“We’re going to have a pretty good market in the spring even though the interest rates are rising,” said Conrad Vanino, broker with Century 21 Park Road, Wyomissing. “… Some of the people out there are going to try to make a decision before the rates get any higher.”
Steady winter activity and resulting lower inventory will temper the typical spring surge of buyers and sales, according to Vanino.
“Inventory is still down, so prices have been increasing slightly for the past six, eight months,” he said. “I think that will continue into the spring and summer market. … Any real good listing will get a lot of activity and probably sell fast.”
Carbon County also realized inventory pressures, fueled in part by an 18.5 percent growth in closed sales and a 19.7 percent drop in new listings in February.
Inventory is down,” said Hugh Dugan II, an agent with Hugh Dugan Real Estate, Jim Thorpe. “What is happening due to that is that homes that were … sitting on the market now are selling because buyers are still able and willing to buy.
“However, because of the lack of inventory, properties that have been on the market for 160 days plus are now selling, and they are actually getting pretty good offers.”
Dugan sees the recent bump in interest rates as an indicator of a stronger residential real estate market.
“I’ve seen it more often than not in the past couple of months that homes are getting, I don’t want to say top dollar, but more than I expected … because of the lack of inventory,” he said. “… As soon as springtime comes, you’re going to see a few more homes hit the market.”
VACATION MARKET HAS RETURNED
Monroe County in February saw a 13.3 percent drop in closed sales and a 20.7 percent drop in new listings.
“February was a bit off when compared to last year, not by that much,” said Thomas R. Wilkins, CEO with Better Homes & Gardens Real Estate/Wilkins & Associates, Stroudsburg. “It’s down a little bit but it’s coming in steady. Last winter, sales were off 15 percent in January and February, and we made that all up in the remaining months.”
He said the vacation market has come back, “pronounced.”
“As the economy stays strong, your secondary housing markets are going to come back. We’re definitely seeing that,” said Wilkins, adding he also sees a more balanced residential market.
“When you have a heated market where a buyer thinks they are getting a good price and a seller thinks they are getting a good price, everybody walks away a winner,” he said. “That’s a good market. That’s definitely what we’re in now.”
BRISK SPRING ACTIVITY
In Warren County, N.J., February over February closed sales grew 17.4 percent, pending sales grew 23.1 percent and new listings grew 12.6 percent.
“For January, February, it was actually pretty busy,” said Rich Tillman, broker/owner of Re/Max Town & Valley, Hackettstown. “There’s a good pool of buyers out there. We, like most places, are lacking good inventory.”
Tillman sees that the recent bumps in interest have not yet affected activity.
“I anticipate a very brisk spring and a very good year,” he said. “… There seems to be a renewed vigor within the community, the buyer community, business community, selling community.”
He has not seen price appreciation.
“You would think that with the lack of good inventory, buyers out there and multiple offers, that prices would rise,” he said. “We really haven’t seen that.”