Pennsylvania Mortgage Borrowers, Real Estate Agents Adjust to Housing Market

With the spring real estate market more than halfway to its traditional end-of-June close, many real estate agents are saying that they - and the buyers and sellers they deal with - have finally adjusted to post-housing-boom conditions.

“Buyers and sellers are aligning a little bit better than they had been,” said Bari Shor, an agent with Prudential Fox & Roach in Center City who has experienced her share of changing Pennsylvania housing markets.

Though it’s taken some time, sellers are finally starting to face the fact that they can no longer dictate price, Shor said. “I keep emphasizing that, to sell it, they have to have the property looking market-ready.”

And Pennsylvania mortgage borrowers “are starting to realize that they can’t lowball everything,” she said.

In the suburbs, “sellers are more educated about the realities of the market than they were six months or a year ago,” said John Duffy of Duffy Real Estate on the Main Line. “Most know what ‘pricing properly’ means, although there are a few exceptions.”

With so many houses for sale, Duffy said, “buyers are spending more time, and aren’t just looking at a property once, but coming back two or three times for each listing.”

More than 60,000 units are on the market. Monthly pending sales - those that have not gone to closing, but have had all the contingencies removed - were at 6,000 or so in the early months of the year for which multiple listing service data are available.

That means a lot for potential mortgage loan applicants to look at - and it’s a good reason why houses are taking two weeks longer to sell this year than they did last year.

The hottest market segment?

Houses in the $300,000 to $500,000 range “are flying off the shelves,” Shor said, “especially if they look good.” The higher end of the market - $1 million and above - is much slower in both city and suburbs.

There are still bidding wars in some neighborhoods, “especially if they are priced on the money,” Duffy said. He cited a house in Havertown with five offers and one in Gladwyne with three offers, both in the $500,000 to $1 million range.

Although sellers in other regions of the country appear to be panicking, agents and mortgage brokers said they see no evidence of that here.

“Today’s sellers are more educated than they were in the 1980s, so they hear these reports of doom on the national media and take them with a grain of salt, because they know this area is different,” said Diane Williams, an agent with Weichert Realtors in Spring House, Montgomery County.

The eight-county Philadelphia metropolitan area was not as overwhelmed by investors as the Florida, Nevada, Arizona and California housing markets, so median prices here were not driven up to artificial levels - nor has the bottom dropped out of the market.

In fact, multiple-listing-service figures show that median sale prices ranged between 92 percent and 98 percent of the listing price during the first three months of both 2006 and 2007, although there is no way to tell whether the percentages reflect list Pennsylvania home prices when houses first went on the market or prices reduced to entice offers.

Many sellers have been fearing the worst, agents said, and have more often than not discovered those fears were not justified.”A lot of agents who haven’t been around for a long time are moaning and complaining about how things are going, but I assure them that this is a normal market, that interest rates are still really low and prices are steady,” Williams said.

SOURCE: The Philadephia Inquirer