Inventory remains challenging for the residential real estate market in the Lehigh Valley, but buyer activity continued to be strong as unemployment rates stayed low last month.
Those are among the highlights in the December housing market data from the Greater Lehigh Valley Realtors.
“There was an affordability problem, as people are getting new jobs they have to establish credit to apply for loans but I don’t see it as a huge change in the real estate market,” said Sean LaSalle, president of GLVR.
The improving economy and low unemployment rate appear to have positive impacts on the housing market, but people still need more product.
“I think for the month of December, that’s a good sign, not so great for our inventory levels,” LaSalle said.
Home prices were consistently up again in most markets in 2018 but at reduced levels compared to recent years, according to the report.
High demand for fewer homes for sale help raise prices. While unemployment remained low and wages grew, the percentage of increase, on average, has not kept pace with home price increases, the report said.
However, LaSalle said it is still a great time to buy and sell a home and he hoped inventory levels would improve this year.
Compared to December 2017, new listings decreased 4.1 percent to 444; pending sales were up 17.1 percent to 499. Inventory levels shrank 11.9 percent to 1,571 units.
Prices continued to rise when comparing figures from December 2017 to December 2018. The median sales price rose 3.8 percent to $190,000. Days on the market were down 17.6 percent to 42 days. Sellers were encouraged as the month’s supply of inventory was down 12 percent to 2.2 months.
“Usually at this time of year, we see a decreased amount of listings and decreased amount of sales, but new listings were down, pending sales were up. Usually at this time of year, it’s pretty even.”
LaSalle put it down to pent-up demand.
“People are continuing to buy through the winter … interest rates are still historically low,” LaSalle said.
While a fourth interest rate hike by the Federal Reserve in 2018 shook the stock market at the end of the year, the federal agency indicated the number of rate increases this year would be halved, according to the report.
“Every time the interest rate goes up, it’s more expensive to buy a house,” LaSalle said. “The interest rates are down, actually,” he said, in reference to this month.