Valley housing market difficult for buyers | News | Ezine Daddy

SELINSGROVE — Seven years after buying their first home together, Amanda and Taylor Wolfe are home hunting again.

This time, they say, the experience is much more difficult and frustrating.

“When we bought our home in Harrisburg in 2014, it was pretty normal and simple,” said Amanda Wolfe, 31. “We looked at about 10 homes before we found one we liked. We made an offer and there was no bidding war.”

That is not the case in today’s market in the valley and across the country. The prices are unattainable for many buyers. For buyers who have the means, national home availability is near record lows, making for stiff competition like the situation the Wolfes are experiencing now.

The couple want to move to the valley with their sons Forrest, 3 1/2, and Wilder, 1, where they both have family but face a much tougher house hunt, though they’re keeping all options open within 30 minutes of Shamokin Dam, according to Snyder County where Taylor Wolfe has worked since December.

They’ve viewed about 30 homes and made five bids in six weeks, but still no luck.

It’s definitely a seller’s market, said her real estate agent Aimee Buehner of Bowen Agency.

“Stock is limited and the increasing number of buyers has created demand,” she said. That demand, Buehner adds, is prompting more buyers in the area to either pay cash, bid up to five percent over asking price, or even forego inspection.

“Almost no entries”

The nationwide shortage of homes for sale is fueling a surge in activity in almost every real estate market.

When homes are listed, Buehner says, buyers must make an offer quickly and be prepared to engage in a bidding war.

“Sellers receive multiple offers within 48 hours,” she said. “I tell buyers to keep their eyes peeled and look at houses 20 to 25 percent less” than they were approved to buy, to give them more room to negotiate.

“There are virtually no listings,” said Ann Hilliard, a Lewisburg-based broker and owner at RE/Max Bridges, who has been in the space for 29 years.

The last few home sales that Hilliard has been involved in were sold for cash and didn’t require inspection, something she’s witnessed more frequently over the past two years.

While home sellers are “very happy,” she said, frustration is growing for buyers who can’t close a deal without spending more than the asking price, paying cash, taking out a traditional loan without financial assistance, or forgoing a home inspection.

A new home that Hilliard listed for $375,000, more than she originally recommended, and it attracted a buyer who paid more than $400,000.

“I’ve got no idea anymore,” she said, adding that the increased activity has given her “a lot of practice” at writing offers.

Due to a lack of home inventory, Hilliard said she has two clients who are willing to sell their homes and move in with relatives before embarking on a home search of their own.

Joe Kantz, a Snyder County commissioner and apprentice auctioneer, recently sold a home in McClure for $15,000 more than expected.

It was bought by a real estate agent, he said.

“If you want to know what your house is really worth, sell it at auction,” Kantz said.

cash purchases

Buehner had rarely made home purchases with cash, but said she’s made about five in the past few months and has noticed they’re on the rise.

A quarter of all homes sold in the US in February were cash purchases, compared with 22 percent a year earlier, according to the National Association of Realtors. During the same period, the average home price in the country rose 15 percent to $357,300.

If cash isn’t on the table, Buehner said, buyers with conventional credit are most likely the winning bidders, as they often don’t come with requirements like a home inspection.

“I have at least three buyers who saved for a year to qualify for traditional credit,” she said.

Hilliard said she was amazed when a home seller was upfront and said they would not accept financing from a potential buyer.

The rental housing market is just as bleak, Hilliard said.

“We don’t have many apartment complexes or townhouses” in the area, she said.

In areas like Selinsgrove and Lewisburg, which have these types of rental properties, Hilliard said prices have gone through the roof.

For a two-bedroom rental, “it’s hard to find anything under $1,100,” she said, adding that she’s been involved in negotiating semi-detached rentals in the area for up to $1,400 a month.

Buehner isn’t sure what exactly is driving the market, but one theory is that the pandemic is drawing many people from big cities, where they’re used to paying skyrocketing real estate prices and rising taxes, to rural areas like the valley, where the House prices and taxes are much lower.

Hilliard said there is a market demand for traveling nurses in the region, and millennials — Americans between the ages of 23 and 41 — are also having an impact. They have money, are raising a family and are ready to become homeowners, she said. But older homeowners are choosing – and increasingly able – to stay in their homes, which is putting fewer homes on the market.

According to the National Association of Realtors, millennials make up 43 percent of homebuyers in the US — the most of any generation — up from 37 percent last year.

Though the Wolfes are unwilling to forego a home inspection, they expected their broad geographic search to help in their quest.

“We’ve even lowered our standards and are looking at three bedroom, 1 1/2 bath homes,” said Amanda Wolfe.

So far it has made no difference. In three cases in the last few weeks, sellers have accepted higher offers – including one where the other buyer also waived an inspection.

“It’s so frustrating,” said Wolfe, who said she and her husband briefly considered building their own home but scrapped it for a number of reasons.

“We like the charm of an old house,” she said, adding that the cost and time involved in building a new home is more than they can afford due to supply chain issues.

Adding to the difficulty of buying a home for so many is the soaring interest rate, which is over 5 percent, more than two percentage points higher than last year.

That means potential buyers now face an average monthly mortgage payment of more than $1,700, according to the Mortgage Bankers Association, an increase of more than 8 percent from a year ago.

“It’s hard to believe, but I think this year is going to be tougher in some ways than it’s been in previous years,” said Danielle Hale, Realtor.com’s chief economist. “At least what we’ve seen so far is that the number of homes for sale continues to decline and prices continue to rise. These two factors combined suggest that the competitive market will keep buyers on their toes.”

Hilliard, who hasn’t seen interest rates this high in 10 years, said all indicators show the housing market won’t stabilize in at least a year or two.

That’s frustrating and worrying for Buehner, who also expects the trend to continue.

“I don’t see it slowing down,” she said.

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