Real Estate Information Archive

Speaking of trends, we'd be remiss not to mention the trend in mortgage rates, which has been rising over the past month. Indeed, the rates on some mortgage products are up over 25 basis points. So the obvious question is, will the trend continue?

Opinions are mixed, but they tend to lean toward the trend reversing. Some analysts believe that impending government spending cuts and tax increases, which could occur in 2013, will further slow economic growth. That means money will leave riskier investments like stocks and head for haven investments like U.S. Treasury securities. The demand for these securities, in turn, will lead to lower mortgage rates.

Then again, maybe the economy isn't as bad as many economists believe. Housing has always been a key component in economic growth, and the outlook for housing is pretty darn good these days. In fact, Fannie Mae's Economic & Strategic Research Group believes that increases in residential construction will add 0.2 percentage points to gross domestic product this year. Housing construction and home sales have a cascading effect, producing additional demand for home furnishings and many other retail products and services.

The rising trend in mortgage rates might be unsustainable, but even if rates reverse course, recent history suggests they aren't going to reverse much lower. Therefore, it's important to remind our home-purchase clients that rates have risen, but any savings achieved by waiting for a reversal could be offset by a higher purchase price.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

Existing home sales gained traction in July, moving up 2.3 percent to 4.47 million units annualized, to partially reverse a 5.4-percent decline in June. The monthly existing home sales trend has been choppy for most of 2012, but going back to July 2011, the trend is mostly higher.

Price concessions appeared to be occurring in more existing home markets (or perhaps fewer markets experienced sharper concessions) in July; the national median price for an existing home declined 0.8 percent to $187,300. When viewed from a longer-term perspective, though, the median price looks encouraging – up 9.4 percent year over year.

Supply is one frequently mentioned factor for the choppy sales trend. Supply relative to the current sales rate is at 6.4 months, down from 6.5 months in June and 9.3 months in July 2011. Inventory levels remain far below the peak set in 2004. That's good news for prices, but maybe not so good news for sustaining an upward sales trajectory.

New home sales, on the other hand, continually make gains. July sales increased 3.6 percent to an annualized rate of 372,000 units, which beat the consensus estimate by 2,000 units. If we go back to June 2011, the trend in new home sales has been mostly up, and mostly unbroken.

As with existing home sales, new-home sales experienced a few more price concessions, though mostly in the lower-priced sectors. The national median price dropped 2.1 percent, to $224,200, for July. The dearth of inventory should keep future discounting in check. Inventory is a mere 4.6 months at the current sales pace, a 31-percent decline over the 6.7 months in July 2011.

The positive trends in pricing and sales are welcomed news, to be sure. But that doesn't mean everyone is content. Sluggish job growth continues to weigh on the economy, while articles on shadow inventory continue to capture headlines.

We are more sanguine than most on the housing recovery. The Wall Street Journal appears to share our sentiment. A recent WJS article reiterated a number of the more salient points we've been hitting on for the past year: namely that shadow inventory is a well-vetted issue, many of the homes in the inventory will never hit market because they are uninhabitable, many of the homes have been converted to rentals, and many of them have been disposed through orderly short sales.

The most important takeaway is that shadow inventory is well vetted. It's never the known issues that sink a recovery, it's always the unknown issues – those lurking in the shadows. That said, shadow inventory has long ceased to lurk in the shadows, which is why it really is no longer shadow inventory.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

In an effort to compare what you can own versus renting a home here are six examples that are located on the East Shore of Harrisburg that can be owned for a principal and interest payment for $800 per month. This calculation was arrived at using a 30 year fixed mortgage rate of 3.625%. Naturally, an owner would have additional payments that would include taxes and insurance. But when considering that my unofficial review of potential rentals and the costs there is a compelling argument for the benefits of owning a home.

If you have any questions about these homes or any other homes in the Harrisburg PA area please contact me at Don@DonRoth.com or visit my web site, www.DonRoth.com, and click on the search listings tab. Have a great day!

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

One of our frequent laments over the past year has been the lack of diversity in the mortgage lending market. Fannie Mae, Freddie Mac, and the FHA back more than 90 percent of all new loans today, up from a third five years ago.

Unfortunately, the level of diversity might not be rising soon. Housingwire.com reports that regulators are pushing for lenders who offer high-risk mortgages to hire certified, licensed appraisers to conduct interior property inspections. (A high-risk mortgage is defined as one secured by a home with an interest rate above a certain threshold.) What's more, if a seller acquires this high-risk property for a lower price within six-months, an additional appraisal must be supplied at no cost to the consumer.

Basically, the regulators' proposal would raise the cost of higher-risk loans, which means there will be fewer of these loans. In turn, higher costs could make lenders even more risk averse, which would further shrink the pool of potential home buyers.

At this point, we think it makes financial and economic sense for lenders to venture further out on the risk scale. We understand the concerns, given the number of loans that went sour a few years ago. But today, there are simply too many potential borrowers relegated to the sidelines because of excessive risk aversion and its accompanying regulatory costs.

Prudent and thoughtful lending doesn't mean eschewing risky lending, it means approaching risky lending with intelligent underwriting procedures.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

It looks like a new trend is developing in the second half of 2012: upping the home-price outlook. Last week, we mentioned that Zelman & Associates raised its home-price forecast for 2012. This week, it's Bank of America's turn.

At the start of the year, analysts at Bank of America predicted home prices would rise a mere 0.5 percent for 2012. Today, these same analysts believe national home prices will post a 2-percent gain, followed by another 2-percent gain in 2013, which is up from their original estimate for a 0.3-percent gain.

We weren't surprise to see Bank of America raise its price expectations. We also weren't surprised by its rationale. Bank of America cited many of the same variables we've cited over the past year: a shift toward shorts sales among creditors, a decreased flow of foreclosures, a reduction in supply. Increased demand also helps, which when coupled with decreased supply leads to the inevitable – higher prices.

Home builders have also held supply in check. Starts, especially on single-family units, remain at lows that are below those seen during the 1981-1982 recession.

Home builders still have a long way to go before they hit the long-term annual average, but they've been ramping up production over the past year. Housing starts came in at 746,000 annualized units in July, which is down 1.1 percent from June. It's important, though, to keep an eye on the big picture. In that context, starts are up 21.5 percent year-over-year. It appears starts will continue to gain momentum, considering permits rose 6.8 percent to 812,000 annualized units in July.

Increased new-home inventory won't materially change today's low inventory levels. In other words, home prices – new and existing – should continue to gain traction across the country. (Of course, all markets are local and the degree of traction will vary among markets.)

As for the overhang of shadow inventory, the longer it remains in the shadows, the less likely it will be inventory. Houses, we often forget, are depreciating assets if they are insufficiently maintained. Houses can, and do, go away. We actually lose over 300,000 housing units annually through neglect, fire, or natural disasters.

In short, we still see persistent price gains for much of the country.

Speaking of prices, the price of most mortgages rose this past week. This actually marks the third-consecutive week where mortgage lending rates rose. Granted, we are talking about a couple basis points in some instances, but it's still a trend.

An improving economic outlook (which raises loan demand) was the most repeated explanation for rising lending rates. Retail sales are trending higher, and increased sales reflect rising consumer confidence. Increased home-building activity is also bolstering the outlook for the economy.

So where are rates going? The 10-year U.S. Treasury note is a useful proxy for gauging mortgage lending rates, and it's been trending higher over the past month. So we don't expect a pull-back in rates this week. In fact, we wouldn't be surprised to see a fourth-consecutive week of rate increases.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

The problem with vetting national numbers is that local markets rarely reflect the national numbers. This causes problems, mostly due to false or unrealistic expectations if the local numbers don't gel with the national numbers.

The fact is there is never a perfect time to buy or sell a home. Only in hindsight do we realize that our timing was good, or maybe not so good. That said, it's important not to be paralyzed by the fear of not selling at the top or buying at the bottom or financing at rock-bottom rates.

There are still pundits (most notably Fiserv) who think falling home prices are in our future. Unfortunately, that expectation gets reported at the national level and is interpreted to mean prices in most markets will fall. This isn't the case, but it tends to attenuate activity through fear.

We are keen to emphasize that markets are local. But even in local markets that are rising, there will always be concerns about prices backsliding or the economy tanking. The key is to always factor in where we are in a historical context. Looking at the big picture removes some of the worry and places a long-term investment like residential real estate in the proper perspective. It also increases the likelihood of making a profitable purchase or sale.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

The foreclosure data continue to trend positively. RealtyTrac reports foreclosure filings declined 3 percent month-over-month in July and are down 10% year-over—year.

We are not surprised by the downward trend in foreclosures; it's simply more remunerative for banks to seek other alternatives than taking back a house. RealtyTrac reports that short sales, on average, sell for $25,000 more than an REO property.

Banks are no doubt being helped by the persistent uptrend in prices. On that front, CoreLogic reports national prices rose 2.5 percent year-over-year in June, and 6 percent in the second quarter of 2012 compared to the first quarter.

Supply is a main price driver: there simply isn't enough supply to meet growing demand, particularly in the starter and low-price segments. Investor demand is impacting supply. Given the strong rental demand in many markets, investors are buying homes and turning them into rentals instead of flipping them; thus keeping the properties off the market.

As for new-home supply, builders only recently began to ramp up construction. New-home inventory is at levels unseen in decades. (Keep in mind; decades ago there were also fewer people.) More demand and less supply can only lead to one outcome – higher prices.

At the beginning of the year, few pundits were expecting prices to rise in 2012. Today, many have changed their tune. Zelman & Associates, a real estate research firm, for one, recently revised its forecast, predicting prices will rise 5 percent nationally in 2012. At the beginning of the year, Zelman's forecast a 1-percent decline.

Negative equity remains a problem in many markets, and that's also helping to keep supply low. But as prices move higher, more of these properties will turn positive. An even stronger price trend will, in turn, draw more buyers and more sellers into the market. That means more overall transaction activity, which means rising mortgage purchase demand.

As for rates on current mortgage demand, they moved up this past week. Most products saw a three or four basis-point increase. Given the trend in 10-year Treasury yields, we don't expect to see a pullback. Over the past two weeks, the yield on the 10-year Treasury note has increased nearly 30 basis points. This suggests that investors are becoming less risk averse, pulling money out of Treasuries and putting that money into riskier investments: Over the same two-week period, the S&P 500 stock index is up over 6 percent.

Yes, the Federal Reserve has stated that it's determined to hold long-term lending rates low for the next two years, but don't assume the Fed can automatically achieve its goal. Markets are dynamic forces, and if more investors sell bonds in favor of other investments, yields on Treasury securities will continue to rise. That means mortgage lending rates will rise too.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

July 2012 might be categorized as the good, the bad and the unknown. First, naturally the good news. The number of sold Central PA homes this July increased by 4.8% over July 2011 and there was a less than 1% decrease in the average sales price year over year in the greater Harrisburg area. This continues the moderate improvement in the real estate market in this area and I anticipate this will continue throughout the rest of 2012. The bad? Well we still have an excess supply of homes for sale at this point and although there continues to be an improvement in the numbers there are great opportunities for home buyers and sellers. Why? Although not a great percentage of the homes for sale are composed of short sales and foreclosures it appears that the perceived negative on home values continues in the market. And as has been discussed in many media outlets people are concerned about their home values being less than a few years ago and their own financial well being.

Even though Central Pennsylvania real estate has not been as affected negatively by the financial slowdown there has definitely been some pullback and caution that continues in the real estate market. The unknown is, at least today, the increases  experienced in mortgage interest rates and is the increase a temporary blip or the beginning of a trend towards higher rates? As an example rates on a 30 years fixed rate mortgage is up by .50% in the last two weeks and if the increases continue the purchasing power for buyers will decrease and be reflected in real estate values. I said two weeks ago that we never know when the interest rates hit the absolute bottom until they have already begun to increase. I do not think we are there yet and hopefully I am correct on that prognosis.

In comparison the 2011 or even 2010 we have made significant improvement in the real estate market and I do think the good will definitely outweigh the bad and the unknown. We are here to answer any real estate questions that you have so please contact us.

School Districts

West Shore

School District                      Average Sales Price 2011                   Average Sales Price 2012   Days on Market

Camp Hill                    $172,400                                 $186,160                      111/40

Cumberland Valley      $296,855                                 $266,155                     104/102

West Shore                  $178,326                                 $169,121                     104/80

Mechanicsburg             $200,770                                 $202,763                     67/89

Northern York               $235,608                                 $213,682                     91/126

Carlisle                         $181,062                                 $163,378                     111/105

East Pennsboro             $156,175                                 $150,647                     180/92

East Shore

School District                      Average Sales Price 2011                   $Average Sales Price 2012                Days on Market

Central Dauphin                   $189,766                                               $205,755                               116/112

Derry Twp                             $322,427                                               $244,253                               90/53

Lower Dauphin                     $235,586                                               $269,124                               98/66

Harrisburg                             $75,530                                                $56,281                                 156/96

Middletown                          $113,069                                               $134,967                                69/119

Steel High                             $69,400                                                $79,267                                 130/62

Susquehanna Twp               $151,141                                               $147,500                                 97/90 

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

Consumer confidence has waned in recent months, and that's hurting home sales. That latest confidence reading, reported for July, shows some improvement. Unfortunately, it also shows a drop in home-buying plans. Before we get too down, though, it's worth mentioning confidence is fickle: it can change quickly and with significant magnitude. No other variable is more impacting on confidence than job growth.

When people are working, uncertainty withers and confidence grows. Confidence, in turn, emboldens more people to pursue big-dollar purchases, such as a home.

When job growth begins to adhere to an observable upward trend, you can be sure confidence will begin to adhere to a similar trend. When that occurs, home-price gains will accelerate and mortgage lending rates will rise. Admittedly, that scenario doesn't appear to be in our immediate future; then again, markets can and do change much faster than most market watchers anticipate. (Phoenix home prices are a good example.) That's something we should all keep in mind.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

There was yet more confirmation this past week on what we already know: Home prices are rising. The S&P/Case-Shiller Home Price Index provided the latest positive data set. According to Case-Shiller, home prices pushed ahead a very strong 0.9 percent in May, which follows a 0.7 percent gain in April and a 0.8 percent gain in March. Best of all, the latest gains were widely dispersed, with 18 of the 20 cities Case-Shiller follows posting gains.

We tend to give Case-Shiller short shrift, because the data are two months old. Fresher data are found at Trulia, Zillow, and CoreLogic. But Case-Shiller is widely followed in the media, so this string of positive numbers should help to dispel any lingering concerns over a double-dip home-price recession.

The trend in foreclosures is a key factor in resurgent home prices. CoreLogic reports foreclosures continue to abate. In June, 60,000 foreclosures were completed, a 25 percent drop from the 80,000 foreclosures completed in June 2011. The current monthly rate of foreclosures is at a level unseen since 2007. Fewer foreclosures means less supply. Less supply, in turn, helps elevate home prices.

The number of foreclosures processed could have actually been smaller. CoreLogic CEO Anand Nallathambi addressed an issue we've been addressing off and on for the past year – regulation. In CoreLogic's foreclosure report, Nallathambi said, “[W] believe even more can be done to reduce the inventory of foreclosures by decreasing the level of regulatory uncertainty and expanding alternatives to foreclosure."

Regulation is an issue most of us share a common opinion. There's simply too much of it today. At this point, it's beneficial to encourage more risk taking, albeit rational risk taking. In other words, lenders should have more leeway in assessing borrower risk. The big frustration many of us confront are borrowers who don't fit the template, but who would make a good credit risk nonetheless. A slower housing recovery is the corollary to excluding these potential borrowers from the market.

With that off our chest, we can report that mortgage rates once again touched a new low, but just barely. In fact, rates across most products moved slightly higher as the week progressed. The most repeated explanation for the slight uptick is that investors are somehow less concerned over the ongoing European debt crises, so they've moved some money out of haven U.S. Treasury securities and into other investments.

When the European debt crises – centered on Spain, Greece, Portugal, and, to a lesser extent, Italy – will finally be resolved is anyone's guess. We expect it won't be resolved anytime soon. So when you couple continued fear in the market, which motivates people to invest in safe, low-yield debt, with the Federal Reserve's policy to hold long-term lending rates abnormally low through 2014, you're likely looking at sub-4 percent 30-year lending rates through the first quarter of 2013.

Of course, this can all change should the economy suddenly ignite, but it's difficult to see that occurring until uncertainty surrounding the November elections is removed. In other words, borrowers have time on their side, at least when it comes to accessing money. Problem is, if they are borrowing to buy a home, time isn't on their side. Waiting means they risk paying a higher price. That's something worth repeating to clients.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.