Real Estate Awards 2017

Real Estate Awards 2017

And The Winner Is…

Recently, we held our May gathering/awards reception at The Country Club of Scranton.  On May 10, we announced the real estate awards 2017 winners for Top Producer, Quantum Leap, Social Butterfly, Rookie Of The Year and Community Service.  Please help us in congratulating our 2017 winners:

Top Producer

Runner-Up To Top Producer

Social Butterfly & Runner-Up

Community Service

Quantum Leap

Rookie Of The Year

Featured Home – Countryside Victorian In The Abingtons

104 Fairway Drive

Clarks Summit, PA 18411

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Outdoor Space That Leaves A Lasting Impression

Situated in the Abingtons’ countryside, this featured listing is located between and within close proximity of two golf courses – The Country Club Of Scranton and Summit Hills Golf Course.  This Victorian home is located in Newton Township with great access to the Morgan Highway, West Grove Street, Layton Road, schools, shopping, library, Scranton and more.  Huge front and side yard are a real plus.  This corner lot gives you the impression that you own half the street!  Check out the large, multi-level deck, in-ground pool and patio area, which is perfect for hosting a party or gathering.  The outdoor space is spectacular and enhances your views.

You can enjoy Northeastern Pennsylvania’s seasonal views from this listing’s wrap-around porch.  The inviting foyer will surely welcome you home, but you can also enter from its two-car garage through the laundry/mud room into the kitchen as well.  The kitchen features ample counter space, granite counter tops, Sub-Zero fridge with the bonus of a breakfast area.  The formal dining room and living room, perhaps the focal point of this home, “sound” Victorian to the eyes and ears.  The living room features French doors.  The family room has a spacious quality to it, featuring a fireplace, French doors which lead into the kitchen and access to the deck/outside.  The lower-level is finished and showcases an entertainment area in addition to a den.  The master bedroom highlights bay window seating – just wait until you see the master bath!  The other full bath on the second floor accentuates a marble-top vanity.

Countryside Victorian

This new listing has four bedrooms and three baths, not to mention spacious rooms, windows aplenty, new remodeling, hardwood throughout and an artistic touch in every corner meant to inspire you.  This is arguably the most prestigious area of the Abington Heights School District.  This home is priced to sell and won’t be on the market long. Schedule your showing today!

Discover this featured home by taking the Morgan Highway to Country Club Road. Turn on Country Club Road and make a right on Fairway Drive.  104 Fairway Drive is the corner property immediately on your right.

For more information on this listing, contact Gladys Linda Porchetta at 570-766-3719 or gporchetta@realtynetwork.net.

Thinking About Selling? Cash In With These 4 Real Estate Tips

Many things can add to the stress of placing your home on the market.  There’s a timetable of when you hope to or worst yet, need to be out of your house.  There are costs associated with the move from your prior home to your new one.  You may even lack wiggle-room between your mortgage pay-off with closing costs and what you can get for your home on the current market.  And yet, at the top of virtually every homeowner’s list is the dreaded preparation involved prior to putting your home on the market.

Here are four do-it-yourself (DIY) real estate tips for prepping your home to sell:

Appeal To First Impressions

via GIPHY

Missing the mark on a first impression in the business world or in a job interview, can be detrimental to the relationship moving forward.  The same absolutely applies to marketing a home in the wonderful world of real estate.  In most cases, depending upon its presentation, the home can leave a potential buyer with a feeling of consideration, disregard, indifference or disgust.  As a seller, your number one goal is getting buyers into your property.  Curb appeal, professional photography, landscaping, smell, etc. attract or deter buyers.  Do you best to appeal to first impressions with homebuyers, so you don’t miss opportunities to sell to the right ones.

Don’t forget: A home’s first impression begins online, the place where you’ll actually get the most “impressions”.  For more on appealing to first impressions, click here.

Depersonalize Your Space


Homeowners would do well to step back from their home prior to listing it for sale.  What I mean by this is having the ability to place yourself in a buyer’s shoes.  You want to be able to see your property from the most objective point of view possible.  Does your home “reek” of you?  Are your photos and your personal artifacts obstructing a buyer’s imagination (see the photo above)?

Don’t forget: Get the advice of a friend who will tell it like it is. This is the advice you need while prepping your home for the market – the cold, hard truth!

More On Space

via GIPHY

This leads us to our next important tip, which can be lost in all this appeal and “it’s not about you” talk… you want your home to be spacious and well-balanced.  You might have a smaller home, but it can still give the perception of being spacious through proper staging deployment.  Light, clutter, paint colors and the like all play a significant role in creating space, if you will.  Do your rooms seem dark or confined?  If they do, you would be wise to investigate sources of natural light, look at your window treatments, perhaps change the colors of the rooms and/or add artificial sources of light.  Decluttering a room can really open it up as well.

Don’t forget: Empty/vacant rooms can make a home feel sterile and might actually feel uninviting to potential buyers.  Strike a healthy balance between these two extremes: being constricting or empty.  It would be best to consult a home-stager and/or real estate professional for further advice.

The Most Important Space

Thinking About Selling
Staging/Remodeling your kitchen might be the single most important decision you can make while ramping up to sell your home.  Clean, open and neutral are generally good guidelines to adhere to here, but this varies from market to market.  Granite countertops and stainless steel appliances presently appeal to many buyers as well.  The impact of a kitchen can really resonate with today’s consumers.  Don’t sleep on this one!

Don’t forget: This is the one room that can make or break a deal for you, so strongly consider upgrading yours before putting it on the market.

 

If you’re thinking about selling your home this year (and now’s a perfect time to do that), focus on these four selling tips first prior to listing it.  Don’t stress about prepping your property.  Call a REALTOR® today in order to create a schedule for getting it market ready in a manageable and reasonable amount of time.

4 Reasons You Should Be Talking About Spring Real Estate

4 Reasons Talking Spring Real Estate

Homebuyers are starting to get nervous, at least that’s what I’ve been hearing.  Inventory’s down and rates are steadily increasing, no?  Most probably won’t remember, last year there was an uncharacteristically large drop in February’s home sales, but we rebounded very nicely in March.  Regardless, there have been other things preoccupying our time recently such as Stella, Russia, the World Baseball Classic, March Madness right down to the Sweet Sixteen and everything in between, and real estate has taken somewhat of a back-seat thus far in 2017.  That will change.

Here are 4 reasons you should be talking about spring real estate this year:

Interest Rates

Last Wednesday, we received the news that the Federal Reserve has raised its benchmark rate and this in turn, has sent some into a panic.  If you’re looking to purchase a home in 2017, maybe even thinking 2018, don’t fret, a Fed rate hike doesn’t automatically correspond to mortgage rate increases.  Yes, we could see mortgage rates climb to 4.5%-4.75% by year’s end, but those are “abyss-mal” from a historical perspective and believe it or not, below the rates a decade ago.

Let’s say you were planning on making a home purchase a year from now where rates would be hovering around 5%, and conceivably this would be a rate-increase you couldn’t afford for a particular home you desired (having certain specifications).  We’ll apply this to our present day and look ahead to March 2018 as well:

March 2017 Purchase March 2018 Purchase Low March 2018 Purchase Avg. March 2018 Purchase High
Loan Amount $130,000 $130,000 $145,000 $171,000
Interest Rate 4.25% 5.00% 5.00% 5.00%
Loan Terms 30-year fixed 30-year fixed 30-year fixed 30-year fixed
Monthly Payment (P&I) $640 $698 $778 $918
Monthly 2017 Savings $58 $65 $77
Yearly 2017 Savings $696 $780 $924

Keep in mind in our local market, the average purchase price is $130,239 (year-to-date 2017, through the Greater Scranton Board of REALTORS®).  Note that the average sales price, each quarter since Q1 2014 until the present has fluctuated between $130,239 and $171,277.  Also, note interest rates vary based upon your credit score and the type of loan program/lender one utilizes.

I think it’s important to acknowledge these range of values as well as the mean purchase price of $145,290 (average price of the last thirteen quarters – GSBR).  If a homebuyer waits a full year to purchase a $171,000 home, they will lose approximately $900+ per year.  I think homebuyers on the fence should strongly consider getting off: At the current average sales price, they will still save about $700/year, by purchasing now versus later.

Last Spring

We saw “all indicators point to [last] spring being the busiest since 2006” (in a statement released a year ago from Jonathan Smoke, Chief Economist at realtor.com).  Freddie Mac, the public government-sponsored enterprise and mortgage loan company, also made a very similar claim at the time.  Not only did this come to fruition, but it carried over into the summer selling season in such a fashion that July was a-typically hot.

So are some of these same factors present in 2017?  Yes, historically low interest rates are still present.  The job market is looking robust and more promising.  Millennials will persist in dominating homebuyer market share and this segment will continue to produce more families.  I’m no Mr. Smoke, but I would say many of these trends still exist.

Locally, our average and median sales prices continue to rise year-over-year:

Average Sales Price Median Sales Price
Q4 2016 $149,529 $130,380
Q4 2015 $147,151 $129,000
Q4 2014 $145,826 $125,000
Q4 2013 $145,042 $125,000

I also believe there’s still repressed housing demand from local buyers.  We’re seeing that despite lower than normal inventories (see below), buyers are still purchasing (pending home sales remain on par with last year through February, 338).  These are great signs for this spring market!

4 Reasons Talking Spring Real Estate

Homes Show Their Best

During this time of the year (as Stella’s stain fades), we’ll begin to see tulips budding and many of the winter shades of gray turn into the greens of spring.  With a quick trip to Lowes, some meaningful landscaping attention and perhaps a good old exterior power-wash, the curb appeal for prospective listings in Northeastern Pennsylvania can show their best.

Perception can be vital here.  Many homebuyers will assume your house’s outward appearance mimics its inward appeal (even if there’s no correlation).  Think about how buyers might experience it at first glance.  Put yourself “in their eyes” – depersonalize and use this season to your advantage.  If you’re looking to sell this year, spring is perhaps the optimal time to showcase your home.

Newer Marketing Channels Are Beginning To Emerge

There are various promotional channels which have existed for some time now, namely MLS, professional photography, detailed property description and open houses, among others.  In addition to these, there are also those intangibles which can really differentiate your home from the rest of the competition such as working with a knowledgeable real estate professional who knows and understands your hyper-local market, establishing the finest first impression for your property online first, then in person, and hiring an agent that drives social media marketing (trust me, they will promote your investment to a much larger pool of buyers).

via GIPHY

This brings me to a significant crossroads in real estate in 2017: Newer channels to market clients’ homes are emerging such a Snapchat, Facebook Stories, not to mention we’ve recently witnessed how Instagram and Pinterest can be game-changers for some in real estate.  Video continues to reshape and evolve the landscape.  Geo-fencing has become a wonderful real estate farming mechanism.  These are some of the innovative tools available to today’s real estate professional, which absolutely should be used to sell homes.

 

As our economy arises from the Great Recession, we are experiencing signs of life.  If inflation is controlled, sustained growth over the years can indeed be promising for many avenues, including real estate.  Last spring was one to remember, but there’s no reason we won’t encounter a similar season in 2017.  Consumers will be talking about real estate more in the weeks to come.  And the above four reasons are why you should be talking about spring real estate too!

Five Ways To Liberate Your Cluttered Home

Clutter can weigh you down and it can get under your skin (or under your bed, many of us know this to be true). Whether you’re looking to sell your home or just plain live in it, clutter can affect your overall health.  In this post, we’re giving you five practical ways to attack your rummage head on.

Five Ways To Liberate Your Cluttered Home

Don’t Bring It In!

The reason this is our first tip for decluttering your home is because it’s the most logical starting point for placing you on the right path to serenity in your home (and maybe even your life).  Think about it, like the dirt and germs on the soles of our shoes, we need to ask this question: What are we bringing into our homes?  We need not wonder why we’re gaining weight, if we’re consuming ice cream and Doritos virtually every night.  Likewise, when we mindlessly bring all sorts of things into our house, should we really be shocked by the mountains of paper and junk that find their way to the nooks and crannies of our abode?

Don’t Overwhelm Yourself

Chances are your house didn’t go from Feng shui to Hoarding: Buried Alive overnight.  In the majority of cases, our messes take gradual possession of us.  Like a stray cat, we welcome it into our homes, into our way of living, and before we know it, the cat’s pulling the strings.  Every room is its playground!  Quite frankly, it’s habits like this that need to be broken and reset.  Twenty-one days to do that, right? – according to Psycho-Cybernetics by Maxwell Maltz (1960).   Again, in an attempt to declutter, take the baby-step approach.  Start small.  Set a schedule in your planner or icloud calendar for each day over the period of several weeks to gradually organize/clean small areas of your home (see the Penicillin Method).

Gorilla In The Room

messy room frantic kid hiding clutter

Perhaps the most troublesome areas of the house (with the exception of the attic) are those places we spend a majority of our time, such as the kitchen or family room.  Yes, it can be intimidating, but the reward of clutter removal in these spaces can really boost one’s confidence.  A successful strategy can be had by compartmentalizing troublesome areas of your home into smaller manageable chunks.

Just Pretend (Or Maybe You Don’t Need To)

Pretend you’re putting your home on the market and if you are, then get to work pronto.  Thus far we haven’t addressed purging your home of extraneous stuff prior to listing it for sale, but this is critical.  Homes with clutter, which lack a sense of openness, can restrict the imagination of the buyers who preview it.  This can make a bad first impression or worse yet, it can negatively affect the fair market value of the home.  Make sure to speak to your real estate professional about other things you can do to make sure you’re maximizing the perception of value potential purchasers have when considering your home for the first time.  If you’re not selling or thinking about selling, pretend you are.  Make a list of those things you’d accomplish over the course of a few weeks/months prior to getting your home market-ready.  Plan it out and trick yourself into thinking you can tackle this monumental task which lies ahead of you – which you can by the way!

Make The Hard Decisions Now

Clutter is a symptom of “decision delay”, plain and simple.  At the end of the day, we need to make those hard decisions and say thank you and goodbye to much of our stuff.  Marie Kondo, a Japanese organizing consultant and author, suggests we ask ourselves this question (and I’m paraphrasing): Is the object in question beautiful, useful or joy-inducing?  If it isn’t, then it’s probably time to ditch it.

Five Ways To Liberate Your Cluttered Home

One method that can help us with these hard decisions is the “four-box method”.  The concept and deployment are simple.  Take four boxes, preferably large (if you have the space hehe), and label them as follows:

Donate/Sell

Storage

Put Away

Trash

 

Item-by-item, ask yourself which of these four boxes does the item ultimately belong?  And in the words of Elsa…

let it go

At the end of the day’s organizational process, empty the contents of each box.  Put the items from the donate/sell box in the garage or in your car to drop off; place the storage items in their proper areas, such as the basement, attic, storage, etc.; those items you are keeping should be placed in more appropriate/functional areas; and the trash items should go into your garbage can right away.

 

Those are the five ways to liberate your cluttered home. Sure there are other roadblocks to putting our untidiness to bed and getting our space back (and in some ways our health, depending on the severity of the situation).  There are certainly extreme scenarios as well as circumstances where sentimentality can be at the heart of the issue.  Sometimes assessing things on a case-by-case basis is best.  Now and again, help from home-staging experts or clinical psychologists may be in order.

Other Resources

Clutter Free by Kathi Lipp

The Life Changing Magic Of Tidying Up by Marie Kondo

“Psychologists reveal what your household clutter says about your state of mind” (January 23, 2017)

5 Things To Do Before You Buy Your Next Home

Watch These 5 Things Before You Buy

We came across this video from Taylor Tepper of TIME’s Money recently.  It was so good we just had to share it.  Grab some popcorn and enjoy, save this page in your favorites (if you’re not ready to buy just yet), and let us know your thoughts in the comments’ box below.

As a homebuyer, if you’re looking for other resources, please download our new first-time homebuyer’s guide.

When Your Listing Agent Is Also A Selling Agent

AgencySo real estate and agency within the industry can be somewhat complicated to navigate.  Furthermore, having a better understanding of real estate agency can boost seller or buyer confidence throughout a home purchase process.  If you’re not sure about the various types of agency, what a listing agent does or if one even needs a selling agent, read on.

A better understanding of agency can preemptively halt any chaos which can ensue.  In our opinion, it’s critical that your real estate professional take you through hills and valley of agency – listing, selling and so on.  Here’s a primer on agency, where we’ll likewise address when your listing agent is also a selling agent.

Listing Agent

In Pennsylvania, the listing agent (the agent who lists and is actively attempting to find a qualified buyer for a seller’s property) is the agent who works in the best interests of the owner/landlord.  Did you know this agent must “safeguard his principal’s confidence and secrets.  A real estate broker, therefore, must keep confidential any information that might weaken his principal’s bargaining position if it were revealed” except in the case where material defects to the property exist?

The listing agent…

  • Represents the seller
  • Must be loyal to the seller
  • Must uphold confidentially
  • Must make a good faith effort to find a purchaser/tenant
  • Must disclosure their role (as a listing agent and if they’re also acting as a designated or dual agent)

Agency

Selling Agent

There are at least two sides to each real estate transaction: Buyer and seller or tenant and landlord.  We’ve discussed the importance of a listing agent, but obviously the other side is as critical to any deal.  A selling agent (aka a buyer’s agent) similarly has fiduciary responsibilities to the purchaser/tenant much like the listing agent has to the owner/landlord.

The selling agent…

  • Represents the buyer
  • Must be loyal to the buyer
  • Must uphold confidentially
  • Must make a good faith effort to find a property for purchaser/tenant
  • Must disclosure their role (as a buyer’s agent and if they’re also acting as a designated or dual agent)

Did you know that a buyer doesn’t need a selling agent?  Is it advisable?  No, but like the migration of the monarch butterfly it does happen from time to time.  In most cases, the seller (via commission paid to the listing company) pays the both the listing agency and the buyer agency.

Dual Agency

Subsequently when your listing agent is also a selling agent this is known as dual agency.  This concept of dual agency may sound absurd to some buyers and sellers alike.  How could a listing agent, who is looking out for the best interests of his/her seller, also act in the best interests of a buyer?  It’s a very good question to think about in addition to having an in depth conversation with your real estate professional.  Dual agency can be undertaken – your listing agent can be a selling agent for your property – when consent is given in writing by both seller and buyer.  It’s done often and ethically.

As a seller or buyer, you might conclude that dual agency just isn’t for you, and that’s okay too.  It’s a conversation you need to have with your REALTOR®.  There are alternatives to dual agency, where a brokerage, if it practices designated agency for instance, can assign a seller or buyer to another real estate agent within the brokerage.

There’s so much more to the “agency story” in Pennsylvania as well as other states throughout the nation.  You can gain more information about these agency relationships by referencing Pennsylvania Association of REALTORS® Consumer Notice and by again, bouncing questions off your real estate professional.  We’re here to help!

Over The Threshold

Over The ThresholdMake no mistake about it; marriage generates many things, one of which is real estate home sales.  Millennials who are about to “tie the knot” uncover many challenges ahead.  Oh and by the way, there’s usually a long list of items which need to be accomplished prior to the big day.  What’s more, there are more important things to achieve after the wedding – family, career development, saving and investing (just to name a few).

This is not to diminish the wedding “to-do” list.  It’s stressful, but fun.  It’s menacing at times, but is packed with joy that husbands and wives will cherish their entire lives, each time they remember their wedding day.  When it came to the wedding list, if you were anything like me, cost was a big factor in making decisions and cuts.

Most brides-to-be have given much thought to the type of dress they’d love to wear, or they have a photographer in mind for their wedding day, heck they may even have a playlist assembled for the DJ or band.  What some haven’t given much thought to — where they’ll live after they get married?

Though housing isn’t tops on their list, many prospective brides know exactly where they’d like to live.  They haven’t given much thought to mortgage pre-approval (though they should), but they want to know what’s the largest house they can afford.  Perhaps they want to know what a six room, three bedroom, one bath home in the school district of their choosing sells for in today’s market.

Over The Threshold

When we dive right into it, these thoughts are probing the minds of soon-to-be brides.  Women, who are second only to the largest home buying group, married couples (comprising 65% of the buyers’ market).  According to the National Association of REALTORS® (NAR) Profile of Homebuyers & Sellers, they account for 18% of homebuyers — over double the amount of their male counterparts.  These women are clearly driving home sales.

Brides-to-be most likely are involved with homeownership in the immediate future.  Should they not calculate all their future purchases: gowns, caterers AND housing?  They should also strongly consider their perfect buyer’s agents to discover real estate nuptial bliss.

Resources

Is Buying A Home Right For You, Right Now?
Choosing A Down Payment Over A Fancy Wedding
Getting Married? Skip The Fancy Plates & Ask For A Down Payment Instead
Modern Wedding Gift: Your Home Down Payment
Home Builder Registry: Ideas For Making A Couple’s Dream Home A Reality

For all those women and men who will be getting married soon, we would like to sincerely wish you a lifetime full of happiness together.  We hope you discover a new profound sense of joy and find your dream home.  We’d love to assist you on your path to homeownership.  If you’d like more information/tips for first-time home buyers, download our “Today’s First-Time Homebuyer”…

free first-time homebuyer brochure

Did you know?

When investing in a home (whether single-family or multi-family), many first-time homebuyers need to think “longer-term” investment.  In recent years, over the last eight to be exact, the tenure for homeownership has increased from 5-7 years to now, 10 years.  This timeframe should strongly be considered prior to making a home purchase.

Over The Threshold

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Selling At The Right Time

Gladys Linda Porchetta

Gladys Linda Porchetta is one of Realty Network Group’s recent additions. Gladys has lived in Northeastern Pennsylvania nearly her whole life, residing in both Susquehanna and Lackawanna counties. After graduating from the College of Education at Temple University, her passion for our community and her family led her back to our area. She a first generation descendent of an Italian immigrant (her father) and is also part Irish (her mother).

Gladys not only has an affinity for NEPA culture and community, but she also ‘sold herself’ at the right time years ago, gaining a spot on the Red Bull Philadelphia Wings Team. It was her first sales position and it helped her to acquire essential personal selling skills, which now benefit her greatly in the field of real estate.

“I have always been a person who isn’t afraid to act when an opportunity presents itself. I’m a go-getter. I’m organized and prepared,” emphasizes Gladys. “I enjoy discussing real estate, communicating with people and assisting them achieve their real estate goals. I’m very comfortable organizing ideas into plans and understand the concerns which often arise when one literally has to move everything from one place to another.”

She enjoys real estate. She finds the process of helping home buyers and sellers rewarding. She also recognizes a special trade in our business locally, appraisals. She’s gained experience working for an appraiser in our area. This has also been a valuable addition to her real estate sales experience.

Gladys chose Realty Network Group for many reasons, but two stand out: (a) She highly respects the firm’s Managing Broker, Ann E. Cappellini; and (b) in recent years, she’s been spotting the company’s signs everywhere, especially throughout the Valley area (her hometown).

If you need a real estate professional to help you to realize the possibilities of selling your home or purchasing one, contact Gladys Linda Porchetta today at gporchetta@realtynetwork.net or 570.766.3719 (cell). A real estate win for you is her priority. If Gladys sounds like a good fit for you and your real estate needs, contact her today.

It’s Inevitable, Three Real Estate Trends We Can Expect Heading Into 2017

Heading Into 2017Heading Into 2017

I get the sense that we’re on the verge of having a superb year in real estate in 2017.  Yet when faced with low listing inventory, rising home prices and a first-time homebuyer market which is bogged down by student loan debt; something has to give in order for it to be a stupendous year.  These are three real estate trends which we can expect heading into 2017.

 

 

 

 

 

 

Heading Into 2017How Low Can We Go?

Real estate inventory has been low and we shouldn’t expect that to change much until the heat of summer returns.  Perhaps this trend sounds obvious as we approach the holidays, the hustle and bustle, hot cocoa and frigid temps.  But what are some of the factors affecting inventory levels?
 

  1. Sellers are staying put and upgrading their homes
  2. Sellers are faced with increased pressure, not having other homes to move into
  3. Construction of new homes is anemic
  4. Renting, in many markets, is still a viable option

Lower interest rates often provide sellers with more buying power – consumer spending, the ability to save or the potential to remodel.  Furthermore, frequently in the higher-priced home market, home prices haven’t experienced significant increases, yet upgrading the home (as long as the seller isn’t over-improving it) remains a productive hobby.

With a competitive 2016-2017 market, too often sellers have a fear of moving from their homes when they don’t necessarily have another home to move into right away.  This pressure causes them to stay put.  Many attempt to avoid contracts containing contingencies such as this, where a seller in the act of purchasing another property, needs to close on his/her property at the same time.  Naturally, this can create more headaches (just ask any real estate professional).

New construction throughout much of the country has limited options for first-time home buyers as well as those looking to move-up or down in the market.  We’re seeing demand outpacing the supply of new construction.

The affordability of renting in some regions has negatively impacted the pool of buyers and this can go both ways: While this means there are less buyers searching for homes to purchase, there are also landlords who don’t feel compelled to sell their investments, but rather reap the benefits of their revenue stream.

These are some of the key factors disturbing housing inventory levels.  During the third quarter of this year, inventory began falling steadily – there are 4-to-6% fewer homes on the national market than there were earlier in 2016 (Zillow September Real Estate Report).  According to a September report from the National Association of REALTORS® (NAR), there’s been a 7% drop, year-over-year, in homes on the market.  In our market, we’ve experienced inventory hitting its lowest levels in a September month in over four years [year-over-year stats from the Greater Scranton Board of REALTORS® (GSBR)].

 

Heading Into 2017Median Home Sale Prices Up

So with inventory being down, but demand increasing we have the housing phenomena of rising home values.  The average sale price for a house in the Greater Scranton area is $142,436, which is up 4.1% year-over-year according to GSBR data.

Lately, there has been a fear of rising interest rates.  If prospective homebuyers are truly worried about losing money via interest rates, they have a higher probability of entering the market.  This trend coupled with lower than normal inventories drives up home prices.  The Standard & Poor’s CoreLogic Case-Shiller home price index has reported its highest index level since October 2007.  It’s actually quite fascinating.  Some other factors which are motivating buyers are economic expansion, falling unemployment, rising pay and the prospect of deregulation over the next year or so (something president-elect of the United States of America, Donald Trump has been a proponent of).  This is all great news for real estate despite some mounting buyer frustrations in this seller’s market.

Recently, the Citizen’s Voice ran this feature on home prices in the Greater Scranton area – Home prices up in several regional population centers.

 

(via GIPHY)

Income-To-Debt Ratios Are Shrinking

For many home buyers, especially millennials, student loan debt has really been a barrier of entry into the real estate market.  As a college post-graduate myself, I know the challenges that can arise in purchasing a home with student loan debt.  NAR’s Student Loan Debt & Housing Report, which was released in June of 2016, cited student loan debt as a major hurdle to home buying for 71% of non-homeowners who were surveyed.  Think about how this debt is affecting millennial buyers and our housing market – rising debt, falling homeownership rate.

With millennials now being the largest generation in our nation, superseding baby boomers, they’re essential for a healthy economy and a flourishing real estate market.  The demand for homeownership is obviously there.  This inflow of first-time homebuyers into the market will continue, but with income-to-debt ratios shrinking, other measures need to be deployed to add a stimulus to our economy.  “The NAR estimates that one job is generated for every two home sales.”  With that being said, I believe it’s imperative that our legislators find solutions that will prevent a “college-bubble” from bursting and alleviate some of this student loan debt as it relates to mortgage lending restrictions, and perhaps more importantly, survival in today’s America.

 

So as we’re faced with near historical lows for homeownership in our country (63.4% homeownership rate in Q3 of 2016); inventory, home prices and millennial debt present challenges for the upcoming year.  Yes, there’s a healthy demand for real estate amidst low inventory levels, which is a great sign for the future.  And yes, momentum at year’s end has been weaker than the beginning of 2016, but the potential for housing market growth in the months and years to come looks fairly promising.

 

Other resources:

http://www.nationalledger.com/real-estate/real-estate-home-values-growing-291096.shtml#.WCJE2C0rKM8
http://realestate.cleveland.com/realestate-news/2016/11/experts_point_to_headwinds_for.html
http://www.lansingstatejournal.com/story/marketplace/real-estate/2016/11/04/student-loan-debt-affecting-millennial-homebuyers/93199606/
http://rismedia.com/2016/11/08/four-trends-to-shape-real-estate-in-2017/#close