After an uninterrupted year, the vibrant Center County real estate market shows few signs of slowing down.
The shift to remote working in the wake of the COVID-19 pandemic, combined with low interest rates and low housing supply in the market, has fueled what local realtors are calling a ‘sellers’ market. Which is also a national trend. Nationwide house prices are now the highest on record, even surpassing the 2006 real estate boom before the economic crash, according to newspaper reports.
“From May of last year through July (2021), there hasn’t been a slow month,” said Kristin O’Brien, president of the Center County Association of Realtors and real estate agent at Keller Williams Advantage Realty.
Between January and August of this year, sales made by CCAR members increased by 13% compared to the same period last year, according to CCAR data. And the average selling price of a home in and around Center County has climbed to about $ 294,000 this year, from about $ 265,000 last year, according to these figures.
The shopping spree triggered by the pandemic
When Center County ‘reopened’ non-essential businesses in May 2020 following a shutdown order from Governor Tom Wolf to mitigate the spread of COVID-19, O’Brien said the local market was inundated new buyers.
In the first three weeks after reopening, O’Brien said, she put 26 homes under contract. And the low supply of housing pushed up prices. “Some houses were getting $ 10,000 more, $ 40,000 more,” she said.
“What was happening was that people who had backing – guaranteed money – were buying property at full price, whether in cash or borrowing money, or waiving all inspections and were basically saying, “I’m taking the property as is,” said Scott Yocum, owner and founder of Yocum Real Estate Center, who has been in the business for 34 years.
Yocum said his own son, who moved to Center County during the pandemic and now works as a real estate agent, waived all his inspections and paid the asking price for his property in Patton Township after he got it. only visited by video. The property, located in the State College Area School District, had seven other offerings, he said.
Who buys homes in Center County – and where?
According to CCAR data, almost all areas in Central County increased their home sales compared to 2020, with the exception of Bellefonte, which saw a slight decline. Properties in the Bald Eagle Area School District spent the fewest days on the market on average, at 25 from 53 days last year. Properties in the State College and Bellefonte school districts spent an average of 31 and 39 days in the market, respectively, and the two districts had the highest total sales this year. Both areas also have less than a month of housing supply, while all other areas in Central County have more than a month of housing supply, the data shows.
O’Brien said the data is useful, but doesn’t always tell the whole story. She is not sure why the properties in the Bald Eagle area sold so quickly, but said from her experience that buyers seemed to have a lot of interest in properties in this area with a large square footage.
Properties in more rural areas of the county like Bald Eagle and Penns Valley have also seen their average house prices rise significantly, according to CCAR data. The average selling price of a property in Bald Eagle has increased to around $ 237,000, up from around $ 196,000 last year. Penns Valley has the second highest average selling price behind State College at $ 290,600, up from $ 251,800 last year.
First-time homebuyers and those with unconventional mortgages or small down payments often struggle to compete with all-cash offers or buyers who have chosen to forgo all of their inspections, realtors said.
Buyers are also staying in the market longer, as fewer homes are listed for sale, O’Brien said. In the pre-2020 market, buyers could review an average of 12 homes, make a few offers and get one accepted in a matter of weeks, she said. But from 2020, she said, buyers could review 30 homes and make eight offers over several months before getting one accepted.
Typically, O’Brien said, a five-month housing supply is what realtors call a “balanced market.” Central County currently has less than a month of housing supply, according to CCAR data. This means that if no other home were put on the market, all the inventory would be sold in less than a month, she said.
The Center County market is a mix of investors looking for multi-family, commercial properties, and individuals and family units looking for residential single-family homes, Yocum said. He has seen scores of people moving to the county over the past year and a half – some having taken on new jobs in the area and others reaching retirement age in hopes of being closer to the children or enjoy the amenities of Happy Valley.
O’Brien said Penn State alumni are also returning to the area in large numbers – some buying second homes, but others hoping to trade expensive city living for Center County affordability. Remote workers also enjoy the flexibility of their careers and choose the region or return, she said.
The market appeared to be slowing down a bit, estate agents said, particularly in August. Instead of 10 deals on a home, sellers were starting to see two or three, O’Brien said. But now that September is in full swing, she said, it seems to be picking up.
Yocum said he believes the market will continue to be very stable over the next 18 months, as long as interest rates remain low and workers can keep their jobs amid the COVID-19 pandemic in Classes.
O’Brien said she didn’t want to scare new buyers off or discourage them, however. “Depending on what you want and where you want it, there are still good opportunities for buyers. There is some hope. “