BETHLEHEM, Pa. — The spring homebuying season is off to a robust start in the Lehigh Valley, with homes selling quickly and above asking price, but some would-be shoppers still are on the sidelines.
The Greater Lehigh Valley Realtors reported homes in March sold, on average, for $335,000 — tied for the highest recorded price in the area — as the spring season kicks into gear.
"What’s happening nationwide is a positive sign of things to come."Justin Porembo, GLVR CEO
“There is plenty of buyer demand heading into the spring selling season,” GLVR Chief Executive Officer Justin Porembo said in a news release.
He pointed to the fact that it’s not just the Lehigh Valley seeing plenty of early activity. There’s been a nationwide rebound in home sales, and it comes amid fluctuating mortgage rates and elevated sale prices, Porembo said.
“While statistics for the Lehigh Valley aren’t showing a year-over-year jump in sales just yet, what’s happening nationwide is a positive sign of things to come,” he said.
March Stats
GLVR reported a drop in inventory nearing 20% in March, with 496 units for Lehigh and Northampton counties.
With the low inventory, the median sales price increased 9.8% to $335,000 — tying the sales price record set in June 2023.
Other notable housing statistics for March included an increase in pending sales (7.7%), and homes that sold, on average, in 22 days.
That’s four days faster than the previous March, GLVR said, with an existing one-month supply of inventory.
In Carbon County, where the median sales price was at $255,000, the supply increased to 2.3 months. Days on market also were nearly double Lehigh and Northampton counties', at 40 days, but saw a drop from 53 days the previous March.
Survey: home ownership unattainable
Despite the strong start locally to spring, it’s a more muddled outlook across the nation.
Nearly two in five (38%) of U.S. renters don’t believe they’ll ever own a home, up from 27% less than a year ago, a new report from Redfin said.
The technology-powered real estate brokerage commissioned a survey of roughly 3,000 U.S. residents, including about 1,000 renters, conducted in February.
Among the findings, lack of affordability was the prevailing reason renters said they are unlikely to become homeowners.
“The sheer expense of purchasing a home is causing the American Dream of homeownership to lose some of its shine."Redfin Chief Economist Daryl Fairweather
The most common obstacles to homeownership listed in the survey were: the ability to save for a down payment (35%), ability to afford mortgage payments (33%) and high mortgage rates (32%).
While GLVR does not maintain data on the average down payment for a home in the Lehigh Valley, Redfin put the average down payment nationwide around $60,000 — the largest barrier to homeownership for many people.
“The sheer expense of purchasing a home is causing the American Dream of homeownership to lose some of its shine,” Redfin Chief Economist Daryl Fairweather said in a release.
To wait, or not to wait
Would-be homebuyers are in a bit of a quandary if they’re looking to make an offer on a home this spring.
Do they wait for mortgage rates to fall, or do they accept the market as is?
Making an offer now would lock in a buyer with a rate nearing 7% on a 30-year mortgage.
That’s down a point from late October 2023, when the rate surged to a 23-year high, but well above the average American household sitting on a fixed rate that’s three points lower, the New York Times reported Monday.
“You get a seasonal uptick because the weather is nice and people get the homebuying thought. But that’s not to do with the water level. The water level isn’t great.”Dan Thierry, a mortgage lender at Union Home Mortgage
The Times says the chasm that has opened between the two groups has created a “nationwide lock-in effect” on people in homes they may wish to leave, but don’t want to give up the low rates they’ve secured.
Dan Thierry, a mortgage lender at Union Home Mortgage in Bethlehem, said there are additional hiccups homebuyers are facing.
They include about 32% of buyers nationwide who are opting for all-cash deals — meaning they did not borrow money to buy the house.
“That’s up largely because of mortgage rates,” Thierry said Monday. He noted those who can’t bring all cash to the table are otherwise on the hook for a substantial down payment to be considered a competitive buyer.
“Of those who are getting a loan, [the all cash buyers] are about 13 percent in Pennsylvania, and first time homebuyers are 6 percent," he said.
"And that first-time homebuyer percentage does not include if they get assistance, including down payments and closing costs.”
'Enthusiam is a strong word'
Even with the strong start to spring, Thierry couldn’t help but temper expectations for the months ahead, if ever so slightly.
“Enthusiasm [for the market] is a strong word,” he said. “You get a seasonal uptick because the weather is nice and people get the homebuying thought.
"But that’s not to do with the water level [inventory]. The water level isn’t great.”
“There’s expectations that rates are going to go right back to 3 percent at some point. But we’re not going to be there."Dan Thierry, a mortgage lender at Union Home Mortgage in Bethlehem
And as for mortgage rates?
“There’s expectations that rates are going to go right back to 3 percent at some point," he said. "But we’re not going to be there.
"They’ve been punting it down the road that any day now, we’ll be back to 3 percent. It’ll take years and probably difficult economic conditions to get there.
"It's like that old saying — be careful what you wish for.”
