The Central Pennsylvania real estate sales numbers for May are in and they are very telling. The number of homes that sold in May decreased by 37% compared to May 2010. Yes, that is a dramatic drop but we must remember that in 2010 we were winding down from the Federal Governments First Time Homebuyers Tax Credit incentive which accomplished the intent of selling more homes in an effort to get the economy moving at a faster pace. It worked and probably it sacrificed future home sales.
The average sales price of Central Pennsylvania real estate declined by 6% from 2010 and that decrease does not concern me since when reviewing full year over year average sales prices have held constant for the last three years, which averaged in the $185,000 to $190,000 range. You are probably saying that I am looking through rose colored glasses and that there are positives in the real estate market. Well, the numbers of pending sales (homes that are under contract but have not settled) increased by 17% since the end of the first quarter of this year and are up over 20% since the end of 2010. Factor in the extremely attractive mortgage rates, currently at 4.50% for a 30 year fixed rate and the abundance of inventory there are many reasons to be positive in the next coming months. Are we out of the woods totally, probably not but I am seeing the positives rather than the negatives. Yes there is still some pricing pressure in the market but when you read that the alternative to owning a home is renting and those costs are accelerating at a faster pace than total mortgage payments, in my opinion there is not a contest between owning a home or paying rent.
This region has not had a high percentage of short sales and foreclosures that many areas of the country have experienced so that is an extreme positive. We will see  more positives in the future so if you are a buyer take advantage of this opportune time. If you are a seller be sure that your home is properly priced and as I heard recently insure that your home is a compelling value.