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2010 First Quarter Central Pennsylvania Real Estate Report

Friday, April 16, 2010
by Don Roth

With the change in the seasons, we are beginning to experience a change for the positive in the real estate market in the area. As I have said previously, the change is not going to be a quick fix but rather a slow improvement in the market. But in comparison to many other areas of the country, we are in much better condition and this should continue going through the rest of the year.

The number of sold homes decreased by 3% in 2010 compared to 2009, but this is much improved over the 20% decrease we experienced in 2009 compared to 2008. And the average sales price for the same period decreased by less than 1% to $179,057. Although the days on market increased to 98 days, we are now back to what I call a normal market that was common prior to 2003.

As with last year, the mortgage rate environment is still extremely favorable to buyers, although rates on a 30 year mortgage have increased slightly to 5.25% compared to 5% in 2009. It is my opinion that these rates will continue to increase gradually as we go through 2010. But be sure that lenders have plenty of money available for qualified borrowers and that again should continue throughout the year. So what should a potential home buyer do in this environment, my opinion is take advantage of the low rates and the plentiful inventory that is in the market. There are approximately 4900 residential units available for sale at this time. In conclusion, we are moving onward and upward in the area and take advantage of the positive situation while it is available.

 

Average Sales Price
West Shore
School District
2009
2010
Days on Market
Camp Hill
$218,051
$138,560
119/71
Cumberland Valley
$237,685
$237,875
98/92
West Shore
$192,241
$168,876
89/62
Northern
$261,380
$205,270
136/97
Mechanicsburg
$206,677
$209,006
74/65
East Shore
Central Dauphin
$214,801
$174,302
92/101
Derry Township
$218,064
$205,865
97/103
Harrisburg
$ 63,960
$ 95,110
89/74
Lower Dauphin
$213,629
$210,019
70/164
Middletown
$123,344
$101,388
90/93
Steel High
$ 93,490
$ 65,127

56/108
Susquehanna Township
$163,731
$186,745
110/110

Central Pennsylvania Real Estate Report 2009 - Trends & Prices

Monday, January 11, 2010
by Don Roth

Happy New Year to all. As I report on the real estate market in the region, I think most of us know that to say that it was a challenging year would be an understatement. In many of the areas throughout the U.S., the real estate market continues to be under siege. In Pennsylvania and especially the Greater Harrisburg area, we have fared much better, and there are signs that stabilization and improvements in the market are becoming a reality. When comparing 2009 to 2008, we saw the number of homes sold decrease by 44 sales, which is a very minor percentage in the real estate market. Yes, the average sales price of homes declined by approximately 5% when compared to 2008, but the month to month decline in sales prices was most significant in the earlier months of 2009.

Why do I anticipate an improvement for 2010? Well, one reason is that interest rates are still very attractive, although there is every indication that mortgage interest rates will climb higher as we go through 2010. The impact on mortgage payments is evidenced below for a $150,000 mortgage amortized over 30 years.

Interest Rate Monthly Principle & Interest Payment
5% $805.23
5.5% $856.68
6% $899.33

 

Pretty substantial increase in the cost of a mortgage, isn’t it? We can say it is only a 1% increase in rates, but is actually a 20% increase in the cost of your housing payment. Something to keep in mind is that a rate increase has the effect of reducing the price of a home a buyer could afford. But there is still more positive news for the real estate market. First of all, the first time home buyers credit of up to $8000 is still available for contracts written by April 30, 2010 and closed by June 30, 2010. Also, the other home buyer credit of $6500 is also available under the same time guidelines (more about that in a separate article). Second, there is plenty of quality, well priced homes available for sale, and in my opinion, the asking prices for homes to a great extent is more in line with the market expectations at this time. Maybe I see the glass half full, but I do expect more positive real estate news being disseminated in the coming months; at least in our area.

Average Sales Price: 2008 vs 2009
West Shore
School District
2008
2009
Days on Market
Camp Hill
$219,593
$191,430
61/77
Cumberland Valley
$284,468
$250,326
69/84
West Shore
$197,857
$191,613
57/68
Northern
$219,415
$218,685
73/99
Mechanicsburg
$210,216
$189,781
61/72
East Pennsboro
$182,028
$176,023
53/65
East Shore
Central Dauphin
$199,348
$187,403
72/70
Derry Township
$276,019
$252,568
68/82
Harrisburg
$74,554
$76,194
69/80
Lower Dauphin
$210,022
$215,153
63/79
Middletown
$144,654
$138,461
77/80
Steel High
$76,965
$77,239
82/93
Susquehanna Township
$169,136
$165,807
57/70

 

As we can see, the average sales price in some areas differ from year to year. Although I did not drill through the numbers, my opinion is that there have not been as many expensive homes that have sold. With the availability of the tax credit in 2009, many buyers took advantage of that, and in many cases, we had a higher number of those homes selling in 2009. Also, we did not escape the foreclosure and short sale experience in the area, but the impact was substantially smaller than in other areas of the country. No one likes to see those types of transaction, but unfortunately that is the world we live in right now and those transactions will have some impact on our market going forward.

Lastly, VA and FHA loans are having a bigger impact on the market, partially due to the credit crisis and also because of the changing lending environment we are experiencing. The percentage of those loans went from 22% in 2008 to 36% in 2009. These are still quality loan products and they do not have the negative connotation from previous years. If you would like more specific information on any area, please contact me at 717-579-2879 or email at Don@DonRoth.com. And if you would like to search available homes for sale please go to www.DonRoth.com and click on the search button. Again, wishing you all a Happy and Prosperous New Year.

2009 First Quarter Central Pennsylvania Real Estate Report

Monday, April 6, 2009
by Don Roth

The first quarter of 2009 showed some stability in the real estate market when compared to the similar period in 2008. Although the number of transactions are down by 20% and the average sales price declined by 3%, these numbers are an improvement with respect to the declines that we experienced in the last quarter of 2008. The average sales price overall declined from $184,860 to $178,519 and the average sales price in March 2009 declined from $187,896 to $183,638. The average days on market increased slightly in both periods and it is returning to what I would call more normal times of the late 1990’s and the early 2000’s.

One of the most striking changes is the percentage of loans being initiated by FHA and VA. This percentage increased from 35% in 2009 from only 14% in 2008. This is a good indication since both entities have stepped up to the plate when conventional lending sources were not available, and this trend will continue for a while longer.

But there is some very good news in the market today. 30 year conventional first mortgage rates are still near 5% and, at least in the short term, that should be the going rate. Also, lenders are really attempting to assist buyers in this market to find a mortgage program that fits the borrowers’ requirements. And although the above quarterly sales numbers to many look bleak, the number of pending sales has increased by about 20% since the end of 2008. And although we haven’t completely turned the corner, it is my opinion that we are beginning to see that both buyers have a vehicle to purchase a home at very attractive interest rates and sellers are going to experience more potential buyers for their homes going forward this year.

Below is information on selected municipalities in the region and is reflective of only residential properties and does not include land, investment or commercial properties.

Average Sales Price/ First Quarter
West Shore
Municipality
2008
2009
Days on Market
Camp Hill
$217,223
$197,091
76/93
Mechanicsburg
$162,568
$145,958
51/67
Shiremanstown
$144,933
$150,000
59/47
Lemoyne
$156,983
$112,469
36/32
East Pennsboro
$200,724
$171,440
54/58
Hampden Township
$278,272
$247,573
78/98
Silver Spring Township
$255,771
$258,366
77/67
Upper Allen Township
$266,410
$203,963
76/85
Lower Allen Township
$174,730
$206,434
44/73
Fairview Township
$258,348
$270,124
82/71
East Shore
 
 
Lower Paxton Township
$226,358
$235,288
61/88
Derry Township
$250,125
$216,241
58/75
South Hanover Township
$189,774
$304,936
104/86
Susquehanna Township
$166,728
$162,876
57/89
Swatara Township
$166,896
$147,536
80/64
Paxtang
$140,500
$119,475
77/86
Hummelstown
$161,540
$136,543
57/102
East Hanover Township
$149,000
$265,250
50/75
West Hanover Township
$238,728
$213,928
95/119

 

Information received from the Central Penn Multi List and deemed to be correct. The information on the sales has been selected from Dauphin, Cumberland and Perry Counties and portions of Lancaster, Lebanon and York Counties.

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