Real Estate

Calling All Homebuilders: The Lehigh Valley Housing Market Needs More Supply

The Greater Lehigh Valley REALTORS® (GLVR) reported August data showed another impressive summer month, but also showed how new construction could greatly improve the real estate market – both locally and nationally. “As the summer draws to a close, multiple opposing factors and trends are competing to define the direction of the real estate market,” […]

The Greater Lehigh Valley REALTORS® (GLVR) reported August data showed another impressive summer month, but also showed how new construction could greatly improve the real estate market – both locally and nationally.

“As the summer draws to a close, multiple opposing factors and trends are competing to define the direction of the real estate market,” said GLVR CEO Justin Porembo. “Despite the Federal Reserve lowering its benchmark interest rate, resulting in 30-year mortgage rates declining to 2016 levels, the lack of affordable inventory and the persistence of historically high housing prices have led to lower-than-expected existing home sales.”

Low inventory numbers impact the nation’s overall economy, according to Lawrence Yun, chief economist for the National Association of REALTORS®. “A boost to home building would greatly improve economic growth,” he said. “More free-market prices on construction materials without government interference about where homebuilders have to get their supply will also help produce more and grow the economy. The housing industry cannot grow without more supply.”

That said, as many homeowners refinanced their homes to take advantage of declining interest rates, consumer confidence in housing was reported to be at historically high levels.

“Our real estate professionals continue to monitor the market for signs of imbalances,” said GLVR President Carl Billera. “Although the inventory of affordable homes at this point remains largely stable, it is stable at historically low levels, which may continue to push prices higher and affect potential buyers.”

Notable market stats for August

New Listings decreased 9.8 percent to 1,014. Pending Sales were up 14.1 percent to 856. Inventory levels shrank 22.4 percent to 1,737 units, leading to a Months Supply of Inventory that dropped 25.0 percent to 2.4 months.

Prices continued to gain traction. The Median Sales Price increased 4.8 percent to $220,000, coming in just below July’s record-setting Median Sales Price of $222,000. Days on Market was up 3.2 percent – just a one day difference – to 32 days.

In Carbon County, the Median Sales Price dipped to $130,500. Closed Sales and Pending Sales climbed to 74 and 80, respectively. There was a decrease in Inventory, which came in at 334 units.

More on the Lehigh Valley’s Market Trends

As the premier source of real estate information in the Lehigh Valley, the Greater Lehigh Valley REALTORS® is pleased to provide in-depth data on the housing market. The research is collected from its Multiple Listing Service (MLS) that compiles data from over 2,500 REALTOR® members. Visit www.GreaterLehighValleyRealtors.com and visit the “Market Trends” page to learn more.

For the most current and accurate data, contact a REALTOR®.

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fall-2019-kre-development

Lehigh Valley: HOTTER THAN EVER – The Lehigh Valley is Booming!

With a nationwide trend for living in neighborhoods where you can “walk to” shopping, eateries, and transit, everything old is new again. From baby boomers who grew up on the outskirts of Philadelphia who are moving back to revitalized urban-suburban cities like Bethlehem, Allentown, Easton, to the money-conscious millennials who find added lifestyle value and […]

With a nationwide trend for living in neighborhoods where you can “walk to” shopping, eateries, and transit, everything old is new again. From baby boomers who grew up on the outskirts of Philadelphia who are moving back to revitalized urban-suburban cities like Bethlehem, Allentown, Easton, to the money-conscious millennials who find added lifestyle value and benefits cities have to offer; developers are jumping on board to meet the challenge.

We also live in a world where e-commerce and consumer demand for overnight shipping has facilitated the need for storing goods and warehouses are popping up throughout the Lehigh Valley. Many properties currently used for farming were zoned for Industrial Uses decades ago, increasing their value in a competitive market. Since these vast parcels can accommodate the new mega warehouses that have grown from thousands of square feet—to millions, e-commerce, manufacturing and distribution giants including Amazon, Walmart, UPS, Fed Ex, and QVC/HSN, have already taken a piece of the pie in the Valley. This has also created jobs, and since people like to live near their workplace, it has created a demand for housing, single-family as well as apartments, in and out of the cities.

Since the Lehigh Valley offers close proximity to a large network of major roadways and interstates, it benefits both industry and residential communities, not to mention the need for retail and service space, medical facilities, school expansion, transit, and other community amenities.

To get a better comprehension of the project types being driven in response to economic development and lack of residential inventory, here are a few examples of projects Maser Consulting is engineering:

 

SunCup, City of Bethlehem
JVI, LLC

This manufacturing facility is located on Easton Road in the City of Bethlehem and includes the initial construction of a 178,579 sf manufacturing building on a 13.65-acre site. This project is located on a Brownfield that formerly was used by Bethlehem Steel and Mineral Fiber Specialties.  SunCup employs 53 employees for each shift and produces beverages for Institutional users.  Deliveries to this site utilize tractor-trailer deliveries from a PennDOT Highway and by train via a rail spur extension from the adjacent Lehigh Valley Rail Management line.

 

Lehigh Hills Apartments
The KRE Group

To meet the need for upscale residential apartments in the Lehigh Valley, The KRE Group is proposing to add to their existing portfolio of apartment developments with the upcoming construction of the Lehigh Hills project in Upper Macungie Township.  The KRE Group has developed similar projects at Madison Farms in Bethlehem Township and Spring View project in South Whitehall and Upper Macungie Townships. The 50+ acre site, currently being used for agriculture, is slated to contain a total of eight buildings (7 apartment buildings and a clubhouse) with 273 apartment dwelling units with typical appurtenant site improvements.  The proposed recreation amenities include a clubhouse, fire pit, tot lot, community gardens, dog run, pool, and open space areas.  The site was developed utilizing a conservation design approach and preserves 30 acres of woodlands, wetlands, and steep slope areas.

Conclusion

Different factors historically push urban sprawl and demographics. In today’s world, it’s technology, automation, and demand. According to the Lehigh Valley Economic Development Corporation (LVDEC), the Lehigh Valley region “…is one of the fastest-growing industrial markets in the country.” It is geographically positioned in the right place at the right time to reap the benefits that growth will continue to bring.

 

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Bio:     C. Richard Roseberry, PE, AICP
Principal/Geographic Discipline Leader, Civil/Site
Maser Consulting P.A. 

Mr. Roseberry has over 30 years of extensive experience in Municipal and Private Development engineering services. His diversified expertise in civil engineering includes roadway and utility design; site layout; permitting; sanitary sewer collection systems and rehabilitation; stormwater management; zoning and land use planning.

Mr. Roseberry is a certified instructor for the Pennsylvania Municipal Planning Education Institute, a Certified Public Works Manager, Licensed Wastewater Collection System Operator, LEED Green Associate, and is a licensed professional engineer in New Jersey, Pennsylvania, Delaware, West Virginia, Massachusetts, and Connecticut.

 

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fall-2019-sold

Recession Proof Real Estate In a Year of Major Volatility is Anything Recession-proof?

Real estate investing CAN be recession-proof, believe it or not.  When choosing the right property, you need to take every detail into account.  Ask yourself these questions first… Why are you buying this? Do I expect passive income, retirement income, flip income, first home, second home, and at any point can the property be rented?  […]

Real estate investing CAN be recession-proof, believe it or not.  When choosing the right property, you need to take every detail into account.  Ask yourself these questions first… Why are you buying this? Do I expect passive income, retirement income, flip income, first home, second home, and at any point can the property be rented?  If the property has the ability to be rented easily at an affordable monthly rate and you are in the positive after all mortgages, insurance and taxes are paid, then you may pass GO.  (I mention this because situations change and there could be a time where you are unable to sell it, but the property would do fantastic as a rental)  Does the property need repairs and how much in repairs?  Have the major systems been replaced recently, such as the roof, furnace, and windows?  If the amount of repairs are minimal and all you need are some carpet, paint, and cosmetics, then this paves a positive path for you regardless of the reason you are purchasing.

What about the purchase price? Of course, that is the most important piece to all of this! Are you buying in the height of the market and paying a high premium, or are you buying on a downswing of the market?  To be honest what it really means is that when you buy real estate in a seller’s market and are paying a higher price than in a down market, you need to be mindful of why you are purchasing it and when you plan to sell the property.  If you plan on holding this property for some time and are going to rent it, remember your mortgage balance will be paid down through the rent you charge.  If you are planning to live in the home and sell in 5 or 10 years, you will need to sell it in a market identical to when you purchased it, if you bought it at a premium price, this is why timing is everything.  Keep in mind there are opportunities in every market, you just need to find them!  I have heard this saying over the years, and it does resonate with anything you invest in…. Buy Low, Sell High or Buy High, Sell High, simple concept right?

How is real estate recession-proof?

You need to be aware of your financial position with any purchase in real estate and always prepare for a market swing, if you do this you CAN create a recession-proof real estate. Yes, there will always be a fluctuation in the value, but if the property can be rented, you are still in the positive.  As you rent the property over several years and your mortgage balance is paid down, you will also have equity in the property.  If you purchased the property to live in or as a rental and you updated the property with your own money or the money you made as profit that will help gain equity in the property when you sell it at a later date.  If you purchase the property in a dip in the market and the value doubles when you sell in the right market, you again are in the positive.  It is all about how you purchase the property, that you make an educated decision and have a professional alongside you to guide you through the process.   Even in an upswing, you can make money in real estate.  Full disclosure you can make mistakes and lose money in a down market, which should not happen.  I will be honest and say it is not for everyone, and HGTV makes it look super easy!

At the end of the day always make decisions with your eyes wide open, educate yourself, choose your position wisely, and await the positive outcome!

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Lehigh Valley’s Economic Renaissance Continues at Remarkable Pace

As Network magazine celebrates its fourth anniversary, I couldn’t help but reflect on how much the Lehigh Valley economy has grown and changed, even in just four short years. Those of us who live and work here in the Lehigh Valley are already well aware that the region has experienced a major growth spurt in […]

As Network magazine celebrates its fourth anniversary, I couldn’t help but reflect on how much the Lehigh Valley economy has grown and changed, even in just four short years.

Those of us who live and work here in the Lehigh Valley are already well aware that the region has experienced a major growth spurt in recent years. In fact, this year we were ranked one of the top five fastest-growing regions of our population size in the entire United States, and the single fastest-growing region of our size in the Northeast for the third straight year.

That’s according to Site Selection magazine, which ranks states and metropolitan regions based solely on the number of development projects, amount of economic investment, and job creation during the previous year.

There were 25 major projects that met Site Selection’s criteria last year. Only the much larger Northeast metros of New York City, Pittsburgh, Philadelphia, and Boston had a larger number, and Boston only narrowly edged us out with just six more projects.

Lehigh and Northampton are two of only 20 growing counties of 67 in Pennsylvania. In the last five years, the population of 18- to 34-year-olds has grown by more than 5%. That age group now comprises 42% of the workforce in our two counties.

We are outpacing Pennsylvania in that demographic. Bethlehem’s millennial generation population is 31.1%, Easton’s is 30.5%, and Allentown’s is 28.2%. That means all of our cities have much greater 18- to 34-year-old populations than Pennsylvania’s population of 22.4%.

If you want another indication of how much the Lehigh Valley has grown in recent years, just take a look at how different today’s regional economy looks compared to only four years ago, when Network magazine released its first issue.

The Lehigh Valley’s gross domestic output (GDP), a measurement of a region’s economic output, is currently at $40.1 billion, a record high number in our region’s history. That’s higher than the entire states of Vermont ($27.4 billion) and Wyoming ($34 billion).

It’s also a roughly 25% jump from four years ago when the regional economy was at $32.1 billion. It has grown each year since then.

Much of our economic growth has been driven by our thriving manufacturing sector, which currently makes up $7.4 billion – or 18.4% – of the Lehigh Valley’s overall $40.1 billion GDP. Four years ago, the manufacturing sector had a regional GDP of $5.6 billion, which made up 17.4% of the overall regional economy at the time.

The Lehigh Valley’s population today is 672,907, compared to 650,507 four years ago, and the population between ages 18 and 34 have risen from 139,501 to 144,522 in that time. We have 326,832 jobs in the regional economy today, compared to 304,699 four years ago, and the number of manufacturing jobs in the Lehigh Valley has risen from 30,599 to 33,725 in that time.

Our unemployment rate today is about 3.9%, compared to 5.5% four years ago. The median household income of the Lehigh Valley has increased from $57,288 to $62,507 over four years, and our industrial market has grown from a total inventory of 103 million square feet to 121.7 million square feet in that same time period.

By nearly every measure, the economic renaissance of the Lehigh Valley and its cities continues at a remarkable pace. What’s happening here is unique. Most importantly, ours is not a story of one sector, one industry one city or one county. It’s a story of balance and diversity.

I look forward to seeing what the next four years bring, and beyond.

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summer-2019-navigating-sellers-market

Navigating and Negotiating In a Seller’s Market

Buying in a seller’s real estate market can be daunting. With the possibility of high competition for properties, it can be difficult to determine what might put your offer ahead of others. Below are tips on how to negotiate should you be looking to buy a home in a seller’s market. Sellers have the upper […]

Buying in a seller’s real estate market can be daunting. With the possibility of high competition for properties, it can be difficult to determine what might put your offer ahead of others. Below are tips on how to negotiate should you be looking to buy a home in a seller’s market.

Sellers have the upper hand when it comes to selling in a seller’s market. Buyers can’t be too choosy, especially when the competition is high. If you’ve found a house and there are multiple offers, don’t make demands that will make a seller turn down your offer. If a seller has made it clear that the appliances are not staying, don’t demand them. If there are cosmetic things you don’t like, don’t make the sale contingent upon those items being fixed. A Realtor will be able to offer advice on ways to make your offer more attractive to a seller.

Prices can get crazy in a seller’s market as well, but do not get drawn into an unrealistic price. Remember, even when home inventory is limited, other homes are or will become available. While there are several online programs to instantly provide a ‘Market Price,’ these draw from general information and can be wildly inaccurate. Make sure your Realtor does a market analysis for each home prior to submitting an offer.   There may be a sensible reason to raise your offering price, as well as a good reason to back off. Your agent can factor in expected changes to the area as well as which homes in the area are comparable and which are not.

When it comes to buying or selling a house, finances are a huge part of both transactions. Whether you’re looking to sell or looking to buy, knowing your current financial situation is vital to your next steps.  When it comes to buying a property, getting pre-approval for a mortgage is a must, and it’s an absolute must in a seller’s market. You want to be able to negotiate and close quickly. Having a pre-approval letter from a reputable mortgage lender when making the offer shows you’re serious and ready to make a deal. The letter should indicate the lender has already received and approved your credit history and verification of income. It should have only limited conditions, such as ‘continued level of income of buyer’ and ‘satisfactory appraisal of property.  Money talks when it comes to real estate. If you’re serious about a property, larger earnest money shows the seller you’re serious and already have money on hand. It makes your offer more appealing!

If you currently own a home, one of the first steps you should complete is researching the equity in your current home. You’ll want to know how much your home will sell for in your real estate market. Don’t be afraid to have an inspection done to understand what repairs or work may need to be done on your house as this will help you understand how much you may need to deduct from the possible sale price or any concessions you may need to make for a future buyer.  If you have a mortgage loan, you will absolutely want to know how much equity you have in your home. The equity that has built up could be enough for a down payment on another home. It’s important to remember, though, that any equity is only accessible after closing.

Finding a home when inventory is low can be a difficult task. If you’re on the hunt for a home and live in a city with a competitive real estate market, make the challenge a little less difficult by being prepared!

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2019-middle-neighborhood

Middle Neighborhoods

The “middle neighborhood” is found in most legacy cities –defined by the Legacy Cities Partnership as those “located in the Great Lakes and Northeast region, with over 50,000 residents that have lost 20 percent or more of their population since the mid-century.”  There are 48 of these cities across the United States, including like Detroit, […]

The “middle neighborhood” is found in most legacy cities –defined by the Legacy Cities Partnership as those “located in the Great Lakes and Northeast region, with over 50,000 residents that have lost 20 percent or more of their population since the mid-century.”  There are 48 of these cities across the United States, including like Detroit, Baltimore and the even the cities of the Lehigh Valley.  Each of these cities has a “middle neighborhood,” characterized by decent, but older housing, low crime rates, and that historically housed the working and middle-class residents that contributed to the fabric of the larger city.  They are typically composed of single-family residences with an occasional small shop on a corner and are likely what comes to mind when we think of the small city, urban living in the middle of the last century.  There is nothing particularly distinctive about these areas. They are neither the most distressed in a city nor the most affluent, hence, their name.  Upon closer inspection, these neighborhoods have some great assets: many are walkable to shopping areas, have parks and green space and are near good community schools.  All of these elements harken back to a time where cars were less prevalent, walking distance to amenities was key, and people valued the neighborliness and familiarity of their community.

Despite their lack of distinct identity, these neighborhoods remain critical to a city’s success and overall stability. These properties have provided a relatively stable tax base for city operations, for despite overall population losses in legacy cities, middle neighborhood populations have remained fairly flat.  Because of their important economic contribution to their city, these neighborhoods are becoming a focus of urban planners as cities are observing their historically stable tax base becoming a bit less reliable.  Perhaps there has been an uptick in foreclosures and sheriff sales in the area. Maybe more children are qualifying for free or reduced lunch at the area school. A drive down the streets may reveal a number of homes that need repair.  There may even be an abandoned house on the once bustling block.

These areas are frequently surrounded by more distressed neighborhoods which puts residents on alert for any signs of bleed-over onto their streets. Many middle neighborhood homeowners are still financially able to make a choice as to where they live, unlike residents of truly distressed areas of cities, and many decide to leave as indicators of further neighborhood decline appear. Longtime residents may be observing a shift away from a middle-income neighborhood to a moderate income one, and any perceived negativity can result in a panic for homeowners who may decide it’s time to sell their home before conditions worsen. The more properties there are for sale, the lower the prices are pushed, artificially deflating the value of these homes.  Older homeowners are unlikely to have disposable incomes to invest in older homes, many of which need substantial upgrades and maintenance, making them unappealing to potential homebuyers.

People with less disposable income for upkeep and maintenance purchase these now-affordable homes, defer the much-needed maintenance and continue the cycle of decline. Homeownership rates in these areas are decreasing disproportionately to national and regional averages, while the rate of rental properties is increasing.  Moreover, property values in these neighborhoods are fairly low to average in comparison to other areas in the legacy cities where they are located, but costs to rent these very same properties are quite high, making the homes very attractive for investors.  Tenants are not likely to heavily invest in homes they do not own, and unfortunately, the vast amount of investors are not going to infuse the amount of capital improvements needed into this older housing stock to revitalize a neighborhood.  Municipal leaders are now targeting these more transient, destabilized areas for revitalization.

Middle-income neighborhoods need to market themselves to who they were originally built for in order to survive: working-class residents and middle class.  Unlike 50 years ago, they cannot be marketed only to families with children.  Empty nesters looking to downsize, first-time homebuyers who are looking to establish roots in a true community, potential residents attracted to the unique geography and offerings of the area are all potential targets for any middle neighborhood revitalization.   Providing a way of communicating the good things going on in these areas is critical to restoring confidence in the neighborhood and attracting long term homeowners and quality investors. Municipalities, neighborhood associations, and realtors need to tout the benefits of sustainable homeownership for families – less school transiency, better educational attainment and stronger social ties to their communities.  Even those communities who have realized that these neighborhoods are no longer attractive to homeowners must implement policies that promote stable, responsible landlords purchasing properties and put investors on notice as to acceptable property standards.  Providing quality municipal services to property owners, fostering a sense of community and allowing residents to participate in shaping the future of these neighborhoods will all allow the middle neighborhood to again be a sturdy, stable base of a postindustrial city.

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2019-hey-mom-dad

“Hey, Mom and Dad, can I borrow $100,000+ today?”

Role reversal in families often happens when we aren’t ready for it.  Mom & Dad can’t live on their own and take care of their home anymore, and it’s the responsibility of the children to figure out where the best place is and how they are going to pay for it. It’s not easy like […]

Role reversal in families often happens when we aren’t ready for it.  Mom & Dad can’t live on their own and take care of their home anymore, and it’s the responsibility of the children to figure out where the best place is and how they are going to pay for it. It’s not easy like when you were young and asked your parents to borrow money. In most cases, it is a substantial amount of money. Depending on the health or financial situation, will determine if the children are able to accommodate moving mom or dad in with them or if an assisted living/nursing facility is the best route.

No matter what the answer is, the biggest question is how to pay for either of these choices. 1. Do you make renovations to your existing home? 2. Do you sell your home and look for a new home with an in-law suite? 3. Do you find an appropriate facility?  No matter what you must sell your parents’ house.

Option #1 Making renovations to your existing home.  If you live in a community, with an HOA or not, you need to be sure the proper channels are taken to know if this is a viable option. What are those channels?  Contacting the HOA, Community, Township or City you live in is the first step.  Knowing if you have enough land to expand.  If you do, then finding the right contractor who will do the job up to the Code of the Township/City and applying for the proper permits is the next step. Then how do you pay for this?  Do you need to re-mortgage your home? Will your parents give you some of the money from the sale of their home to finance this? This is where your Realtor can be a big resource for you and help guide you with how not to over-improve your home for future sale, sharing a few names of contacts that they’ve done work with in the past. Making sure they are licensed and insured for your protection.

Option #2 Selling your home to find one that already has an existing in-law suite or extended family option.  You’ve done your homework to realize your current home cannot accommodate substantial renovations due to the Community or Township rules and regs so now what?  Let’s start looking for a home that already has what we need.  In today’s market, this is not an easy task as right now inventory is low and finding the right fit can be time-consuming. Time which is something you don’t have. Selling and buying can take several months to accomplish in any market.  Let’s not forget we still have to sell Mom & Dad’s house.

Option #3 Putting your parents into a Senior Living Facility. This process is usually very stressful, painful and emotional all at the same time.  Finding and knowing the right facility, being able to afford the care given at the facility, and your parents being accepting of this option. One of the biggest questions you should have when shopping these facilities is what if I run out of money? How much money do my parents have to live there before their home sells which is going to be the biggest asset people have to pay for this type of care.  Some facilities will take all the assets you have and once it’s gone so are you.  Now what?  Since option 1 & 2 didn’t work out now, another option is moving Mom or Dad to a state-funded facility. The process of enrolling is tedious, and the State wants nothing short of your first born to be sure there isn’t any hidden money they can tap into.  The state’s research process of your finances can go back as many as 5+ years.

In short, there is much to consider as we age, and the bigger question is how do I know what is best for my Mom & Dad?  Every family and circumstance are different for everyone, so there are no set rules.  That’s where hiring the right real estate agent is going to be one of the best resources to help you through this process.

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2019-six-things

Six “Things” That are (or Should be) in Every Lease

Here are six “things” that I think must be in every commercial real estate lease. You may have a different list. Also, state law may dictate changes or additions. The names of the landlord and the tenant. (That’s obvious.) The address of the premises. (This may also seem obvious, but in early 2015, I received […]

Here are six “things” that I think must be in every commercial real estate lease. You may have a different list. Also, state law may dictate changes or additions.

  1. The names of the landlord and the tenant. (That’s obvious.)
  1. The address of the premises. (This may also seem obvious, but in early 2015, I received a lease from a landlord that had no address for the premises – no street, city or state. Nothing. There were also other errors in the lease. When I pointed out these errors, I was told by the landlord that I was being “picky.” The lease took over three years to be signed.)
  1. Consideration – who’s giving what to whom? (Attorneys Jordan L. Paust and Robert D. Upp in their book “Business Law” defined it as follows: “Consideration is something of value which is a benefit to one party or a loss to the other party. It is the inducement to the contract.”) Rent is the most common form of consideration given by a tenant to a landlord, but it is NOT mandatory. There are many leases (particularly land that’s leased for farming where the tenant grows crops and removes the weeds) in which a tenant takes care of the property, but pays no rent.
  1. The use – what can the tenant use the space for? In my opinion, this is the most important provision in the lease. (This is different from the question “Why do you as the tenant want to lease space in the first place?” If it takes you longer than five seconds to respond with a succinct answer, you haven’t thought through the question. Remember – leases are LONG TERM CONTRACTS. You cannot terminate a lease except where it states you can (end of the term; fire; possibly landlord’s default; maybe others). You do NOT want to break the lease. Going to war with the landlord is very dangerous and often expensive.)

    Once you understand WHY you want to lease the space, then you must determine if the premises can be used for your intended purpose. If you’re the tenant and you cannot use the premises for your intended purpose, then you’re out of business. This provision also protects the landlord, because it can limit the tenant’s activities.

  1. The term – the beginning and ending dates of the lease.
  1. Signatures of the landlord and the tenant. Some state laws may permit the exchange of emails as “signatures.” However, I am not an attorney, so I urge you to consult a good commercial real estate attorney about this.

There are dozens, perhaps hundreds, of other provisions that are important and can appear in a lease. But if you don’t have all six of the above, then you have nothing.

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2019-Lehigh-Valley-evolution

The Lehigh Valley Is A Region that Embodies Meaningful Evolution

Those of us who live and work in the Lehigh Valley every day already know what a special place it is. Now we want to make sure the rest of the world knows as well. It’s not difficult to demonstrate the economic success our region has continued to experience. Just take a look at our […]

Those of us who live and work in the Lehigh Valley every day already know what a special place it is. Now we want to make sure the rest of the world knows as well.

It’s not difficult to demonstrate the economic success our region has continued to experience. Just take a look at our gross domestic product (GDP) – the measurement of a region’s economic output – which reached a record-high $40.1 billion this year.

That’s the first time we’ve ever surpassed the $40 billion mark, which means that, once again, the Lehigh Valley economy has never been better. Our GDP is larger than that of Vermont ($27.4 billion) and Wyoming ($34 billion), as well as 112 other countries in the world. In fact, if we were a country, we’d be the 88th largest in the world in terms of economic output.

Not only is our regional economy strong, but it’s also very well-balanced. In many metropolitan areas, much of the economic output comes from one single sector, and then there is a significant drop-off among the rest.

However, that’s not the case in the Lehigh Valley: our top two sectors are very close together, with finance, insurance, and real estate making up $7.6 billion, and manufacturing making up $7.4 billion. Likewise, our next two highest sectors are nearly even, with education, health care, and social assistance comprising $5.5 billion, and professional services at $5.2 billion.

What all of this means is, simply put, all our eggs are not in one basket. An economy that depends too much on a single sector means when that industry suffers, so too does the region. That’s not the case in the Lehigh Valley; the days of depending too much on a single employer like Bethlehem Steel are long gone.

And yet manufacturing is not just a thing of the past in the Lehigh Valley: it’s part of our present and future as well.

Manufacturing made up 18.4 percent of our overall regional economy last year, which is a much higher percentage than the 11.6 percent it represents in the overall U.S. economy. Manufacturing was also our fastest-growing economic sector, having grown just over 10 percent compared to the previous year.

This balance of our history and deep roots and the forward-thinking evolution of the Lehigh Valley economy is directly at the heart of a new marketing campaign LVEDC is rolling out this year, which will be anchored by the phrase: “Made Possible in Lehigh Valley.”

We’ve commissioned this campaign to increase outside awareness of the Lehigh Valley, develop a positive image of the region, and market it as a desirable and attractive place to live to drive talent acquisition and retention.

The availability of skilled labor is now the single largest important factor driving company locations, even more so than overall operating costs, which had been the primary consideration for many years. That’s why we’ve been focused at LVEDC on strategies and initiatives that will help the region attract, develop, and retain talent.

That’s why we commissioned a year-long study to analyze the regional talent market, the findings of which we are executing on right now. It’s also why LVEDC has created a new five-person workgroup responsible specifically for research and analysis and directing initiatives to support retention and growth of companies in the region.

Our “Made Possible in Lehigh Valley” marketing campaign was purposely designed so that companies and other stakeholders in the region can leverage it to attract new talent. This campaign will let people know we are a region that has something for everyone, with small-town charm and big-city amenities, where people can create the life they want, on their terms.

The Lehigh Valley exists today because of where it’s been, but it’s also a region that embodies meaningful evolution. It’s a community rich with opportunity and driven by hard work, resourcefulness, and reinvention. This is nothing new for those of us already here, but soon, the rest of the world will also know what’s been made possible in Lehigh Valley.

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Greater Lehigh Valley REALTORS® Release 2018 Annual Market Report

As the premier source of real estate information in the Lehigh Valley and its surrounding communities, the Greater Lehigh Valley REALTORS® is pleased to provide an in-depth report on the 2018 local housing market. The information that follows is an overall look at the 2018 housing market, in addition to predictions for 2019. 2018: The […]

As the premier source of real estate information in the Lehigh Valley and its surrounding communities, the Greater Lehigh Valley REALTORS® is pleased to provide an in-depth report on the 2018 local housing market.

The information that follows is an overall look at the 2018 housing market, in addition to predictions for 2019.

2018: The Year of Low Inventory, Rising Prices, and Picky Buyers

Home buyers, now steeped in several years of rising prices and low inventory, became more selective in their purchase choices as housing affordability in 2018 achieved a 10-year low. In turn, the housing market over the last year saw a more seasoned prudence toward residential real estate.

Yet the appetite for home buying remained strong enough to drive prices upward in virtually all markets across the country, including the Lehigh Valley. In 2018, we saw pending sales increase 0.8 percent to 8,544. Closed sales were down 0.6 percent to finish the year at 8,373.

Home prices were up compared to last year. The overall median sales price increased 7.6 percent to $199,000 for the year, and sellers received, on average, 98.1 percent of their original list price at sale, a year-over-year improvement of 0.4 percent. Single Family home prices were up 6.8 percent compared to last year, and Townhouse-Condo home prices were up 6.7 percent.

Year-over-year, the number of homes available for sale was lower by 11.9 percent. There were 1,571 active listings at the end of 2018. New listings decreased by 1.1 percent to finish the year at 11,481.

Distressed? Not in the Lehigh Valley!

The foreclosure market continues to be a hint of its former unhealthy peaks. In 2018, the percentage of closed sales that were either foreclosure or short sale decreased by 47.9 percent to end the year at 0.7 percent of the market.

What to Expect in 2019

Consumer optimism has been tested by four interest rate hikes by the Federal Reserve in 2018. Meanwhile, GDP growth was at 4.2 percent in Q2 2018, dropped to 3.4 percent in Q3 2018 and is expected to be about 2.9 percent in Q4 2018 when figures are released.

We anticipate the biggest potential problem for residential real estate in 2019 to be human psychology. A fear of buying at the height of the market could create home purchase delays by a large pool of potential first-time buyers, thus creating an environment of declining sales.

If the truth of a positive economic outlook coupled with responsible lending practices and more available homes for sale captures the collective American psyche, the most likely outcome for 2019 is market balance.

Full Annual Report

Curious to know what else the Annual Report entails? Contact a Realtor® today for more information or for a full market analysis. You can find a Realtor® at www.GLVR.org

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