Lancaster County Real Estate Continues to Strengthen
Over the past 18 years the number of homes sold in Lancaster County is as follows:
2000 – 5,047 2004 – 6,160 2008 – 4,513 2012 – 4,683 2015 – 5,558
2001 – 5,592 2005 – 6,453 2009 – 4,482 2013 – 4,954 2016 – 6,095
2002 – 5,956 2006 – 6,029 2010 – 4,098 2014 – 4,960 2017 – 6,200
2003 – 5,801 2007 – 5,746 2011 – 4,006
We have just finished the 6th consecutive year with sales increases, after 6 consecutive years of year over year declines, since the peak of 6,453 in 2005. 2017 marks the 5th 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 2017, housing prices are now above 2007 levels. Of course, this will vary depending on the location, price point and condition of the home. Inventory levels have declined steadily for 78 months. The increase in sales, continued decline in inventory and increase in prices indicates that the Lancaster County real estate market continues to strengthen. While high end homes continue to struggle, we have returned to a “seller’s” market in most other price ranges.
My expectation is that we will see the sales momentum continue in 2018 with sales levels returning to close to or exceeding 2005 levels. Further, I expect that we will see prices continue to firm up in 2018 with increases in the 3% to 4% range. Mortgage interest rates will rise in 2018 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. Thanks to the internet, social media and HGTV, buyers and sellers are much more educated and savvy. This cuts both ways but most benefits the buyers and sellers who are able to apply the information to their advantage.
While we have returned to a seller’s market, seller’s still need to 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 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.