The issue of supply and demand is keeping the housing market tight in Crawford County and Pennsylvania.
Pennsylvania’s median home sales price for June was $216,187, up $5,000 from May, according to the Pennsylvania Association of Realtors. This has increased by 6.2 percent compared to the same period last year.
Christopher Bedling, president of the association, said: “The media reports that home sales prices are increasing in local markets across the Commonwealth, with record highs in some areas.” “This continues to be a matter of supply and demand. While listings are down about 23 percent from last year, prices are still rising because there is still demand for homes.”
Local Realtors agree.
There has been a wave (of buyers) since the lifting of the Covid-19 restrictions in 2020, said David Schepner, owner of Howard Hanna Bainbridge Cowman Real Estate.
Realtor and co-owner of RE/MAX Hometown Realty Christine Brown added, “There is a shortage of inventory and prices have jumped because there are more buyers than sellers.
The median home sale price in the Meadville area was $175,500 in the first six months of the year, up about 10 percent from the same period in 2021, Schepner said.
As of this week, Crawford County has 30 active homes listed for sale — meaning they’re not under contract — on the market an average of eight days before they go into contract. The average price of a home for sale right now is around $190,000, Brown said.
In the year In 2019, before the outbreak, there were 200 or more homes listed as active and they lived an average of 30 to 40 days before going into contract, Brown said.
Locally, many elderly residents are choosing to stay at home because of in-home care, Brown said. Another factor behind the local shortage is apprehension on the part of some potential sellers.
“There are some people who are willing to sell, but they are concerned that they may not find another home,” she said.
The pandemic has brought about lifestyle changes at work and school as many people have had to stay at home.
In addition, homebuilders across the country have halted projects and lumberyards have halted production of building materials during the pandemic due to labor shortages, according to Rocket Mortgage Co.
According to the Pennsylvania Association of Realtors, across the state, housing inventory is less than a three-month supply.
Months supply refers to the number of months it will take for homes on the market to sell at the current rate of sales. A modest price appreciation of the six-month supply is considered an equilibrium market between buyers and sellers. A supply of less than six months indicates a rapid increase in prices as demand exceeds supply as buyers are willing to pay more than the selling price.
It all combines to make for a tight housing market here in Pennsylvania and around the country.
“All real estate is local,” Schepner said. “I don’t see another new (big) wave of buyers. I think the frustration (to buy) will be delayed. Over the next six months I saw the twilight.
Rising interest rates last year were expected to slow the housing market – with mortgage interest rates more than doubling.
“A year ago, a 30-year loan was 2.85 percent, now it’s 6 percent for a 30-year loan,” Brown said.
Rising mortgage rates are starting to have an impact, Schepner said.
“I’m seeing multiple bidders on (the same) property,” he said.
However, economists fear that if interest rates are too high, they could trigger a recession. A recession generally slows the economy, but a recession can cause interest rates to fall.