Archives

Looking Back to Look Ahead: 2018 Market Wrap Up and What to Expect in 2019

Consumers should expect home sales to flatten and home prices to continue to increase, though at a slower pace, according to a residential housing and economic forecast session at the National Association of Realtors® (NAR) 2018 REALTORS® Conference & Expo in November. As Lawrence Yun, chief economist for NAR, presented his 2019 housing and economic […]

Consumers should expect home sales to flatten and home prices to continue to increase, though at a slower pace, according to a residential housing and economic forecast session at the National Association of Realtors® (NAR) 2018 REALTORS® Conference & Expo in November.

As Lawrence Yun, chief economist for NAR, presented his 2019 housing and economic forecast, he was joined onstage by Lisa Sturtevant, President of Lisa Sturtevant & Associates, LLC, who discussed the importance of affordable housing in the U.S.

Much of Yun’s presentation focused on recent declines in home sales, but in the context of long-term trends to illustrate the housing market’s actual performance.

“Ninety percent of markets are experiencing price gains while very few are experiencing consistent price declines,” said Yun. “2017 was the best year for home sales in ten years, and 2018 is only down 1.5 percent year to date. Statistically, it is a mild twinge in the data and a very mild adjustment compared to the long-term growth we’ve been experiencing over the past few years.”

In Lehigh and Northampton counties, year to date, home sales are up 0.1 percent, according to the Greater Lehigh Valley REALTORS® most recent market report released for October. The Median Sales Price is up 8.1 percent. The Lehigh Valley is known, as seen here, for following national housing trends. Carbon County, which is its own unique market, has been experiencing a stellar year, partly due to homebuyers looking for inventory not currently available in the Allentown-Bethlehem-Easton area. In Carbon, home sales and home prices, year to date, are up 13.4 percent and 17 percent, respectively.

As to the possibility that we are currently experiencing a small bubble, Yun was quick to shut down any speculation. “The current market conditions are fundamentally different than what we were experiencing before the recession ten years ago,” said Yun. “Most states are reporting stable or strong market conditions, housing starts are under-producing instead of over-producing, and we are seeing historically low foreclosure levels, indicating that people are living within their means and not purchasing homes they cannot afford. This is a stronger, more stable market compared to the loosely regulated market leading up to the bust.”

Yun’s words on foreclosure levels hold true for the Greater Lehigh Valley. According to October market statistics for Lehigh and Northampton counties, only 1.1 percent of the available market (23 properties) were labeled as lender-mediated. In Carbon County, lender-mediated properties came in at 0.6 percent (two properties). Lender-mediated properties are those marked as foreclosed, REO, bank owned, pre-foreclosure or short sale.

Both panelists also discussed housing affordability. While the U.S. is experiencing historically normal levels of affordability, potential buyers may be staying out of the market because of perceived problems with affordability. “NAR research shows that a lower percentage of consumers think that now is a good time to buy, while more are indicating that it is a good time to sell,” said Yun. “Problems could arise if the market is flooded with too many sellers and not enough buyers. Fortunately, that does not appear to be the case, as indicated by months’ supply of inventory at below five months.”

Again following the national trend but marching a tad lower, the Months Supply of Inventory for Lehigh and Northampton counties in October came in at 3.0 months. In Carbon County, the Months Supply of Inventory was 6.1 months. Carbon has been a more balanced market between buyers and sellers throughout the year, while Lehigh and Northampton counties have seen more buyers than there are sellers.

Sturtevant discussed the importance of homeownership on a social level – how homeowners tend to be in better physical and mental health and have greater opportunity for economic self-sufficiency. Additionally, communities with more homeowners tend to be more economically prosperous and better able to attract and retain workers.

“I am a researcher, not an advocate; but the results of my research have compelled me to see the importance of affordable, stable housing, and the positive economic impact to local communities,” said Sturtevant.

Looking to next year, Yun shared his forecast for home sales and median home prices. “The forecast for home sales will be very boring – meaning stable,” said Yun.

With a few months of data remaining in 2018, Yun estimates that existing-home sales will finish at a pace of 5.345 million—a decrease from 2017 (5.51 million). In 2019, sales are forecasted to increase to 5.4 million, a 1 percent increase.

The national median existing-home price is expected to rise to around $266,800 in 2019 (up 3.1 percent from 2018 this year and $274,000 in 2020. “Home price appreciation will slow down – the days of easy price gains are coming to an end – but prices will continue to rise.”

All of these forecasts, however, are dependent on higher levels of home production. “All indications are that we have a housing shortage. If you look at population growth and job growth, it is clear that we are not producing enough houses.”

Commenting on the overall health of the U.S. economy, Yun noted that the economy is “good.” He noted that we have low unemployment, record high job openings, historically low jobless claims, job additions for eight straight years and wages beginning to increase. “This type of activity in the economy should support the housing market, even as interest rates rise,” said Yun.

* National data provided by the National Association of Realtors® and Lawrence Yun, NAR’s Chief Economist and Senior Vice President of Research

Share This:

Lehigh Valley Homes Spent an Average of 30 Days on the Market in August

The Greater Lehigh Valley REALTORS® (GLVR) reported August data showed that while home prices are at or approaching record highs in many markets, mortgage default and foreclosure rates sit near historic lows. In the Lehigh Valley, lender-mediated activity in August made up only 2.0 percent, or 40 properties, of the market. That said, according to […]

The Greater Lehigh Valley REALTORS® (GLVR) reported August data showed that while home prices are at or approaching record highs in many markets, mortgage default and foreclosure rates sit near historic lows.

In the Lehigh Valley, lender-mediated activity in August made up only 2.0 percent, or 40 properties, of the market. That said, according to Justin Porembo, CEO of GLVR, the rise in home prices is outpacing the rise in household income.

“The national median household income has risen 2.6 percent in the last 12 months, while home prices are up 6.0 percent,” Porembo said. “That kind of gap will eventually create fewer sales due to affordability concerns, especially in the middle to high-middle price ranges.”

Back at home, prices in August continued to gain traction. The Median Sales Price increased 6.5 percent to $213,000.

Closed Sales increased 4.7 percent to 907. Pending Sales were up 6.3 percent to 798. Inventory levels shrank 17.1 percent to 2,035 units, leading to a Months Supply of Inventory that dropped 19.4 percent to 2.9 months. Days on Market was down 21.1 percent to 30 days.

“While some are starting to look for recessionary signs like fewer sales, dropping prices and even foreclosures, the fact remains that the trends do not yet support a dramatic shift away from what has been experienced over the last several years,” said Sean LaSalle, 2018 President of GLVR. “Housing starts are performing admirably if not excitingly, prices are still inching upward, supply remains low and consumers are optimistic.”

Carbon County has continued its stellar year with another solid month. Closed Sales increased to 66, versus 58 the previous August, and the Median Sales Price increased to $142,750. Pending Sales climbed to 82, and there was an increase in New Listings, which hit 103. Inventory was up 4.0 percent to 368 units.

The Greater Lehigh Valley REALTORS is a not-for-profit trade association that represents more than 2,000 REALTORS® in Carbon, Lehigh and Northampton counties. REALTORS® are distinguished from real estate licensees by subscribing to a strict code of ethics and standards of practice as define by the National Association of REALTORS®.

As the voice of real estate in the Greater Lehigh Valley, the Greater Lehigh Valley REALTORS® is pleased to offer market insights on its website, www.GreaterLehighValleyRealtors.com. Just click “Market Trends” in the main menu.

Share This:

Penn State’s Franklin Gets Motivational on Football, Charity, and Community

James Franklin, the 16th head football coach in the storied history of Penn State University’s Nittany Lion program, headlined the Greater Lehigh Valley REALTORS® (GLVR) 6th Annual Signature Event on Thursday, May 31, 2018. Franklin, who drew close to 700 attendees to the Sands Bethlehem Event Center, discussed his philosophy on teams and the importance […]

James Franklin, the 16th head football coach in the storied history of Penn State University’s Nittany Lion program, headlined the Greater Lehigh Valley REALTORS® (GLVR) 6th Annual Signature Event on Thursday, May 31, 2018.

Franklin, who drew close to 700 attendees to the Sands Bethlehem Event Center, discussed his philosophy on teams and the importance of team building and mentoring – all of which are crucial to success on the football field, in business, and in life.

“Franklin provided valuable insight and inspiration to salespersons within and outside of the real estate industry,” said GLVR CEO Justin Porembo. “With Franklin’s teamwork message, we were excited for our Realtors® – and salespersons outside of our industry – to hear how working together can better their lives and their community.”

Several nuggets of wisdom from Franklin included:

  • On work ethic: “No one is going to out-work us. No one. You don’t get to East Stroudsburg University to Penn State University without knowing how to work. Wake up every morning ready to attack. There is no such thing as a snooze button. You do a back handspring out of bed and attack.”
  • On competing: “Compete in everything you do. Compete in the classroom. Compete in the weight room. Compete when it comes to community service. Compete in everything.”
  • On sacrifice: “Do you want to be successful? Yes. But very few people are willing to do the things necessary to be successful. Success is being disciplined to make the right decision moment after moment after moment. You don’t take the path of least resistance. You must be willing to make the decision that the common person wouldn’t make.”
  • On healthy relationships: “The only way you’re going to be successful is with positive, healthy relationships in your building, in your organization. Ask yourself, ‘Is this going to foster healthy, positive relationships in our organization?’” If not, you better believe we’re not going to do it.
  • On motivation: “I gave all the pre-game speeches at Vanderbilt. What happens when you’re the only one talking? You start turning into Charlie Brown. ‘Wah wah wah, wah, wah.’ We’re constantly asking other people, coaches and players to motivate our team. If I have to get the team fired up two minutes before running out to play in front of 100,000 fans, we’ve got a problem.”
  • On resumes: “Resumes are the most ridiculous things. References are more stupid than resumes. You’re going to give me a list of people that are going to say wonderful things about you? I’m not hiring anyone unless I know you or someone I know knows you and can vouch for you. I’m going to call people who will tell me the truth.”
  • On community service: “I’m a huge believer in community service. We fill the entire football program on buses. We go down to Penn State Hershey Children’s Hospital and assault the hospital with the most positive attitude you could imagine. Once you realize in life you can get everything you want by serving others, it comes back to you tenfold.”

With the community in mind, a charity auction followed Franklin’s speech. And, yes, Franklin got competitive and helped drive up the bids. In total, $11,400 was raised. The Boys and Girls Club of Bethlehem received $6,600, and the local Penn State alumni chapter received $4,800.

Attendees had the opportunity to bid on various kinds of Penn State memorabilia, some of it signed by Franklin. Items included a mini helmet, game tickets, posters, and more. Kevin Smith of K.D. Smith Auctions was the auction’s master of ceremonies.

Going Beyond the Transaction

The charity auction is not the only assistance GLVR has recently provided to the Boys and Girls Club of Bethlehem. On June 19, 2018, Realtors®, sponsors and affiliates converged on the club for tasks and activities that included yard work, window cleaning, arts and crafts, dodgeball and basketball, and time spent with some amazing kids.

The Boys and Girls Club of Bethlehem is part of a nationwide affiliation of local, autonomous organizations of Boys & Girls Clubs. These clubs, which help children ages 6 to 18 develop the qualities needed to become responsible citizens and community leaders, have opened their doors to youth in communities across the country, serving as a “home away from home” for nearly 4 million kids each year during the critical time after school and in the summer.

The time spent with the Boys and Girls Club is part of a Quarterly Community Events Program. The program was launched in 2017 in a joint effort with GLVR’s Young Professional Network, Diversity and Community Involvement Committee and Affiliate Committee.

In addition to working with the Boys and Girls Club, the Association has organized blood drives with Miller-Keystone Blood Bank, cleaned up parks in Carbon, Lehigh and Northampton counties, created a team for the March of Dimes walk, collected donations for Third Street Alliance, assisted the Big Brothers Big Sisters of the Lehigh Valley with their annual “Bowling for Kids’ Sake” fundraiser, volunteered at the Lehigh Valley Cystic Fibrosis Foundation of the Lehigh Valley’s Great Strides fundraiser, and more.

As Porembo always says, “We’re not just here for the transaction, we’re here to help build the community. We soon hope the word ‘community’ comes to mind when you think of our Realtor® members.”

Share This: