Real Estate Information Archive

Can we call the housing recovery “official”? That, of course, depends on what we mean. You can’t really call a housing recovery official on the national level because all real estate markets are local. Even in the best of times there are always particular local markets lagging.

But if we were to consider national numbers, it's difficult to argue that housing – at least with pricing – has (and is) recovering. We have reported many times over the past months that data from the leading real estate service firms – Clear Capital, CoreLogic, Zillow, Case-Shiller – show prices rising in many local markets.In addition, we've also been reporting on analysts changing their price estimates. The analysts at JPMorgan Chase are the latest to jump on the bandwagon, at least for the long term. Over the next four years, JPMorgan sees home prices moving ahead 12 percent at the national level.

Over the short term, though, JPMorgan remains negative, believing prices are still destined to decline 2 percent nationally. JPMorgan points to the specter of shadow inventory, a subject we have addressed frequently. JPMorgan estimates that 4.8 million properties are distressed, REO, or at least 90-days delinquent. Banks ramping up foreclosure processing means more of these properties will hit the market, thus pressuring prices lower.

It's a tidy theory, yet it hasn't materialized – and may never materialize. Economists at Calculatedriskblog.com have been studying residential real estate trends in various markets across the country. They've found the share of distressed sales is down from June 2011, and the share of foreclosures are down significantly.You could argue that banks still haven't fully ramped up foreclosure operations after last year's robo signing imbroglio. That could very well be the case. The more thoughtful rejoinder is that banks are simply proceeding in a rational, profit maximizing manner. They're processing more short sales and they are prudently selling REO property.

Home builders also see distressed property as a receding concern. Many builders – Beazer Homes, Meritage Homes, Hovnanian Enterprises – have recapitalized their balance sheets by issuing more shares into a rising stock market. These builders are using their new funds to purchase additional land and to expand production.In many markets, it's no longer a question of when the housing recovery will begin, but how it will progress. If JPMorgan is right, and home prices appreciate 12 percent over the next four years (which works out to 2.9 percent annually when accounting for compounding), I think most of us would be satisfied. That means prices would be moving at a rate slightly higher than the rate of annual price inflation. In other words, residential real estate will once again be offering a positive rate of return.

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.

Mortgage lending rates continue to hold multi-decade lows. Could they continue to hold these lows through 2012? We wouldn't be surprised. On the other hand, we don't see much impetus for rates to go much lower either. We ask rhetorically, why procrastinate?

We also see little reason not to borrow to buy. A borrower who takes a 30-year fixed-rate loan at 4 percent is looking at an after-tax cost of 2.875 percent, assuming a 28 percent marginal income tax rate. That same borrower who assumes a 15-year fixed-rate loan at 3 percent is looking at an after-tax cost of 2.16 percent. Both rates are below the annual inflation rate of 3%. It's almost like interest-free money.

What's more, tying a large sum up in owner-occupied real estates means tying up money that could be put to more profitable use. If a buyer puts 20 percent down on a $200,000 home, that means financing $160,000. If a buyer pays cash, he or she no longer has use of that $160,000. That's money that could be used to buy cash-generating investments, such as dividend-paying stocks and rent-generating investment real estate, that yield two or three times the borrowers net interest-rate costs.

In short, tying an excessive amount of money up in real estate when cheap financing is available means enduring a possibly high cost of foregone investment opportunities.

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.

As each week passes, the data on housing becomes more encouraging. This past week's data added to the good feelings.

Existing homes sales continue to post monthly gains, rising 3.4 percent in April to an annualized rate of 4.62 million units. If you go back to July 2011, you'll see a trend that is very noticeably up, with monthly sales trending 15-percent higher over the time period.

Perusing the existing home sales data a little deeper, we find many encouraging details. When local market prices are aggregated into the national number, we find the national median price has increased to $177,400 – a 10.1 percent improvement over the national median price in April 2011.

Strengthening home prices are surely the result of easing competition from distressed sales, which now comprise less than a third of total sales. Fewer lower-priced distressed properties in inventory obviously means less downward pricing pressure.

More seller interest is the corollary to less pricing pressure. The NAR reports that inventory increased to a 6.6-month supply in April from 6.3 months in March. A few commentators positioned the inventory increase as a negative, but we don't necessarily agree. Compared to last year, when inventory stood at a 9.1-month supply, 6.6 months is a vast improvement.

Composition of inventory is also worth considering, and the composition of existing-home inventory this year is of higher quality compared to last year. Better pricing invariably brings better homes to market. We’ve see pricier, higher quality homes hit the market over the past six months.

The trend in new home sales and pricing is also encouraging. New home sales increased 3.3 percent in April to an annualized rate of 343,000 units, easily beating the consensus estimate for 330,000 units. Meanwhile, the national median price of a new home rose to $235,700 compared to $234,000 in March and $224,700 in April 2011.

We don't see new-home prices backsliding any time soon. Inventory stands at a mere 146,000 homes, which is a 5.1-month supply at the current sales pace. A dearth of inventory, coupled with a rising-price environment, means that anyone looking to buy a new home should think hard about procrastinating; rising demand plus shrinking inventory always equals higher prices.

That said, a few opinion leaders are less sanguine than we are, at least on prices. New York-based Fitch Ratings weighed in on the subject and said it sees another 7.8% drop in national home prices this year. In our opinion, that's an awfully steep (and unlikely) drop at the national level when you consider the vast improvement in many formerly forlorn markets – Phoenix, Miami, Detroit, Orlando – that are recovering vigorously.Bottom line, we still see no persuasive evidence to think the majority of housing markets aren't recovering and moving forward.

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.

Whether you are moving across town or across the country most Central Pennsylvania home buyers are looking for up to date information in the areas that you are moving to. We now have an continuous guide for many of the areas in Central Pennsylvania that we hope you will find beneficial when relocating. Please enjoy and let us know of any recommendations you want us to consider. The following Central Pennsylvania counties are included in this guide; Adams County, Cumberland County, Dauphin County, Franklin County, Fulton County, Huntingdon County, Juniata County, Lancaster County, Lebanon County, Perry County and York County. 

Welcome Home. The relocation guide to Central Pennsylvania!

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.

Just as anticipated, mortgage rates have settled back a bit after its recent upward movement of fifteen basis points over the last two weeks. Widespread upward economic movement fostered the rise, but a more realistic approach to the economy’s forward momentum seems to be creeping back in.

Rates have bumped off a little from their historic bottoms of February, but the modest movement should not create any additional disturbance or turbulence for the housing market. Even in the worst-case scenario, the eighth percentage point increase in a loan’s interest rate is probably not enough to ruin most deals. Especially since that slight increase could be ‘brought down’ through the payment of approximately a half-point fee, perhaps less.

It should be no surprise to anyone who has applied for a loan recently that banks are being much more careful. A new repost indicates just how tight conditions have become – and how even borrowers with favorable credit profiles are being denied. Loans closed by banks and mortgage lenders in February had borrowers with an average credit score of 750; this average is up from 740 six months earlier, and an average loan-to-value ratio of 76%, with the average denied loan having a credit score of 699 and a loan-to-value ratio of 83%.

While there is no hard downshift in economic activity, research shows that essentially, with the new spring housing season approaching, we are in the same boat, just with more favorable mortgage rates. An accumulation of February data and early data available for March suggests that activity is stabilizing with a softer trend beginning. Federal Chairman Bernanke’s reassurance about the direction of interest rates doesn’t hurt either, in terms of trimming any upward pressure for current rates. 

Recent weekly data is reinforcing the notion that a cooler economic climate is in formation. Claims for new unemployment benefits moved downward in January to a rate which is the lowest it has been in 4 years. However, the unemployment benefits rate does not incorporate in statistics about workers who are under-employed. Approximately 9.3 million workers are considered underemployed as defined by the Bureau of Labor Statistics. That number is up from just over 8 million in July 2011, but down from a peak of approximately 9.5 million in September 2010. Overall, employment gains for March will be no better nor no worse than February.

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.

I wrote a few months back that the mortgage interest rates will probably begin to increase very shortly. Well, it looks like the time has arrived, at least in the short term. In the last few weeks the rate has increased from the 3.75% range up to 4.35%.

Please review the chart below and see what the impact is on a projected mortgage payment. Yes, there may be some pull back in rates for a while but as I said in a blog last week we never intentionally hit the bottom of the rate cycle until after it has passed. If you need any additional information on interest rates or homes that are available for sale please contact me at Don@DonRoth.com.  

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.

Housing is still dealing with some difficult issues – namely shadow inventory and negative equity. The former has shown much improvement based on data released during the last quarter of 2011; the latter will be helped by HARP 2.0, which is expected to be fully engaged by March.

The good news is economic and job growth will continue to remove rot from the system; that is, if buyers and borrowers are sufficiently motivated to act. Unfortunately, we see too few buyers and borrowers sufficiently motivated. The one question we field most often these days is, “Are mortgage rates going lower?” Embedded in the question is the belief that rates are going lower, which keeps too many people on the sidelines.

Our wish list for this year includes a stronger economy, more jobs, and more confident consumers. We'd also like to see a ratcheting up of interest rates. That way, borrowers prone to procrastination will be less prone to procrastinate when they realize that any uptick in rates won't be followed by two downticks.

What's more, rising rates will be indicative of the sustained economic growth we all want.

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.

We've said that strong job growth will be key to a successful 2012. Early signs are encouraging. Automatic Data Processing (ADP) reports that private payroll numbers surged 325,000 in December – more than double expectations for a 160,000 increase.

The news on jobs is definitely good, but it's important to keep expectations tempered. This time last year, ADP reported that private employment jobs increased by 297,000. That bullish number got more than a few economists and pundits thumping for a full-bore recovery. Unfortunately, job growth abated and practically stagnated through the summer months of 2011.

That said, we remain encouraged. The Bureau of Labor Statistics (BLS) reports that unemployment is, for the most part, dropping across the nation. The BLS's data show that 58 metropolitan areas reported jobless rates above 10 percent, but that's down from 112 a year earlier. Another 129 areas reported jobless rates below 7 percent, nearly double the 65 areas reported in November 2010.

So it appears employment is on the rise, which bodes well for improved home sales in 2012. Prices are another reason we should see more sales. Standard & Poor's data show current home prices when adjusted for inflation are at 2001 levels. In other words, homes are very affordable. When homes are very affordable, more homes will be sold and more markets will clear.

We've provided many examples of markets clearing over the past few months. Beleaguered Las Vegas is the latest example. DataQuick reports that home sales increased 11.2 percent year-over-year in November, with sales being driven by below-$200,000 homes. Prices are low in Las Vegas, to be sure, but the days of free-fall depreciation appear to have ended, with the median home price holding at $115,000 for three consecutive months.

Mortgage rates contribute to the affordability quotient. On that front, mortgages remain very affordable. In fact, over the past week the 30-year fixed-rate loan again touched a new low. This should come as no surprise when you see that the 10-year U.S. Treasury note also touched a new low, with its yield dipping below 1.9 percent.

Rates remain low thanks to the ongoing debt crisis in Europe , which continues to draw money to U.S. Treasury securities even though these securities don't yield enough to compensate for inflation. That's good news for borrowers, especially borrowers on the longer end of the spectrum – such as those seeking 30- or 15-year fixed-rate loans.

Is it worth waiting for even lower rates? We didn't expect to see sub 4-percent loans in 2011, so anything is possible. But you have to consider what's probable. With job growth accelerating and consumer confidence rising, it appears the economy is growing sufficiently to suggest any further rate drops will be measured in a few basis points.

At this point, it's really all about risk and reward. Today, the reward is very high, but we think the risk will likely rise with more evidence of improving economic growth.

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.

As we approach the end of the old year nearly all of us stop to ask, “How will the new year unfold?” Of course, none of us know with any certainty the answer to that question, but it can be insightful (and fun) to ponder. So, how will 2012 unfold, at least as it pertains to the housing and mortgage markets?

Both markets will obviously be influenced by economic growth, which, in turn, will spur job growth. We see a pick up in economic growth and job growth in 2012.The economy has been growing at a sluggish rate for too long now. The United States is unique in that Americans tire of pessimism quicker than most other cultures, and then we do something about it. In our opinion, rising consumer confidence points to a lot of pent-up demand that is waiting to bust loose, and will bust loose in 2012.

A pick up in demand, in turn, necessitates new hires. In fact, a recent survey by CareerBuilder.com found that nearly one in four employers is keen to add new permanent full-time employees. These employers are simply waiting for a clear sign the coast is clear. We think they will get that sign in the first quarter of 2012.

Greater economic activity will obviously impact the housing market. We see accelerated sales volume in both the new and existing home markets. We also expect to see prices stabilize in the first half of the year, and then appreciate perceptibly in the second half.

As for the mortgage market? This is much more difficult to call. The Federal Reserve has stated it intends to hold rates low through 2012. However, all it takes are a few persuasive signs that the economy is back on track, and the Fed could easily backtrack from its stated goals. All we can say is that we would be much less surprised to see mortgage rates 50 basis points higher six months from today than 50 basis points lower.

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 news is understandably slow the week between Christmas and New Year's Day. The most notable release was last Friday's news on new home sales, which rose to an annualized rate of 315,000 units in November, a 1.6-percent gain over October.To be sure, we have a long way to go until we reach the normalized construction rate of 1.5-million units per year. Nevertheless, we expect the new-home market to gain pace in 2012. After all, there are only 158,000 units in inventory. Even at the current slow sales pace, this equates to a record low six-month supply.

Over the past three years, new-home construction has fallen far below historical norms and also below the level needed to keep pace with population growth. The fact is our country gains roughly 2.7 million people and one million new households annually.

You might not see supply as a problem. We are all familiar with the glut of distressed properties. Indeed, Bank of America expects eight million distressed homes to come to market over the next four years. These homes, we've so often heard, will continue to depress new home construction.

We view B-of-A's outlook with a skeptical eye. There is a likely prospect that many of these distressed properties will simply go away. Destruction is too frequently overlooked in many supply projections. A house is not a permanent structure. Many are destroyed by fire, wind and flood each year. Many more are lost through simple decay and abandonment. Based on U.S. Census data, 300,000 homes are lost annually. That number will surely rise in years to come.

In short, the math – low inventory plus more households minus more home destruction – suggests to us a rebound in new-home construction. We are not alone in this contention, either. Wells Fargo projects that housing starts will continue to rise each year for the next five years before reaching once again the normalized construction rate of 1.5-million units annually by 2017.

Of course, projections are one thing, betting on those projections is another. Here, we see an encouraging trend. Big money is starting to wager on housing. The Wall Street Journal reports that many large hedge funds are investing billions in housing-related investments. Other investors have followed suit. Shares of homebuilders are up 30 percent over the past three months, making them one of the best performing investments in the market.

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.