LANCASTER COUNTY REAL ESTATE CONTINUES TO STRENGTHEN
Over the past 16 years the number of homes sold in Lancaster County is as follows:
2000 – 5,047 2004 – 6,160 2008 – 4,513 2012 – 4,683
2001 – 5,592 2005 – 6,453 2009 – 4,482 2013 – 4,954
2002 – 5,956 2006 – 6,029 2010 – 4,098 2014—4,960
2003 – 5,801 2007 – 5,746 2011 – 4,006 2015—5,610-est.
We have just finished the 4th consecutive year with sales increases, after 6 consecutive years of year over year declines, since the peak of 6,453 in 2005. 2015 marks the 3rd straight year of year over year price increases, after posting 5 consecutive years of year over year declines, since the price peak in 2007. With the increases in 2015, housing prices are now almost back to 2007 levels. Of course this will vary depending on the location, price point and condition of the home. Inventory levels have declined steadily for 54 months. The increase in sales, continued decline in inventory and increase in prices indicates that the Lancaster County real estate market continues to strengthen. With the exception of high end homes, which continue to struggle, we have returned to a “normal” market.
My expectation is that we will see the sales momentum continue in 2016 with sales levels returning to close to or exceeding 2006 levels. Further, I expect that we will see prices continue to firm up in 2016 with increases in the 3% to 4% range. Mortgage interest rates will rise in 2016 but I expect the market recovery will be able to “absorb” the increased costs to buyers.
The market correction has created a “wants based” mindset across all price ranges which previously existed in just the higher end markets. Buyers are demanding and getting more concessions on pricing and terms. Although the market is gaining much needed traction, we are still in the midst of a long recovery.
It still remains a buyer’s market but homes are selling if they meet 2 criteria:
- A home needs to be priced correctly. This seems obvious but pricing homes remains an art, not a science and it is difficult to determine just where the right price is in this market.
- Condition of the home. The home must be in good condition. This means it must be clean, uncluttered, neutral, functional and updated. Again, this sounds obvious, but is not easily obtained in many homes.
If a home does not meet these 2 simple criteria, the seller will be “punished” both on selling price and the time on the market. If it does meet the criteria, the home will sell and sell relatively quickly at a “premium” price.
With all of the above said, you need not be fearful to step into the market as long as you are careful and realistic. As a seller, you need to make sure you have done all you can to maximize the value of your home. As a buyer, you need to be sure that you have your financing in place, understand all the new lending regulations and are well versed in the nuances of the marketplace. Whether you are a buyer or a seller, you need an excellent Realtor!
Hopefully, this information has been helpful to you to put the market in perspective. Please contact me if you, or someone you know, have any real estate needs or questions or if you want to discuss market conditions. I look forward to working with you, or your referrals, in the future.