Delaware County PA December 2020 Residential Housing Update

Tri-County Suburban REALTORS and Showing Time, using Bright MLS statistics, have released their Local Market Insight report for single family homes in Delaware County Pennsylvania through December 2020.  If you would like more information about this or any other County or any specific municipalities in the Delaware Valley, please contact me or visit my web site, AndrewWetzel.com.  I am only a phone call, an email or a text away!  I respond promptly to all inquiries.

The market continues to be affected by the pandemic and resulting economic impact.   However, generally speaking, the results in many areas are encouraging and, as always, your experience may differ depending on your location and how you have been personally impacted.  As I always say, the decision whether and when to sell or buy Real Estate is a personal one influenced by a number of lifestyle factors and external variables.  The pandemic typifies that.

The report compares current year-to-date results to one-year ago, same time period.  As with all Real Estate statistics, two things are true.  First, the performance within individual zip-codes can and will vary significantly from the overall County.  Real Estate is local and results can vary greatly from neighborhood to neighborhood and even block to block.  There is no such thing as a “national” Real Estate market any more than there is a national weather forecast so, whether you may be thinking about selling or buying, please contact me for details about your areas of interest.  I can provide current information and keep you informed about the evolving market as well as the knowledge and insight to help you decide what works for you.

My second point is that, unfortunately, all Real Estate statistics involving sold data are stale.  This is especially true if you are relying on Internet valuation models which use recorded data rather than up-to-date MLS information.  Even then, while a sale may be reported as settled or closed today, the real question is when was the offer negotiated?  Typically, sales can take 45 to 60 days to close so the market today may be different from when the offer was presented and negotiated.  Up-to-date information, even if not perfect, is important!

As far as the statistics, there were 8309 units listed for sale through December 2020 compared to 8993 listed through December 2019, a decrease of 7.6%.  Low inventory levels continue to affect related data points.  There were 7139 closed sales through December 2020 compared to 6984 through December 2019, a 2.2% increase.  The median selling price through December 2020 was $250,000 compared to $227,000 through December 2019, an increase of 10.1%.  The large decrease in inventory, meaning the number of properties being listed, had a relatively small effect on the number sold while substantially increasing their selling prices.  The number of currently available properties is well below one year ago and the Days on the Market (DOM) and “Sold to List Price” ratio are much improved.  Do we have an inventory problem or pent-up demand?  Again, these numbers vary throughout the County:  the underlying data shows a wide range of results in all categories among the 49 different municipalities in Delaware County.

Generally speaking, low inventory levels in some areas have produced multiple offers and a frenzy among buyers, some of whom may live to regret a hasty decision to get a property under contract. During the shutdown when “in-person” Real Estate activity was not permitted, many buyers made offers “sight unseen”, some without inspections to make their offers more attractive to sellers.  The effects of these strategies remain to be seen but Real Estate, perhaps with the exception of those properties acquired strictly as “investments” with documented income, is generally not something given its expense and complexity that the typical buyer would want to purchase without an in-person showing let alone removing the protection of an inspection contingency.  Even with our property disclosure law in PA, many sellers either do not know about underlying issues with their properties or forget to disclose them.  Whatever your feelings about property inspections, they can provide important information to a buyer.

What about the properties that did not sell?  Many came off the market and still remain off the market.  As the pandemic has evolved, some properties did come back on the market but many have not.  Did owners delay, change or give up their plans?  Buying activity has been strong but the sellers may be reluctant to allow showings or may have issues holding them back.  Given the statistics, are people making an informed decision or reacting to what they “think” is happening in the market?  A brief conversation may be very helpful if you have any questions about selling or buying.

Anyone thinking about selling or buying needs to understand their local market and decide how to react to the pandemic as a “variable” that was not here last year and, hopefully, will be gone in the near future.  However, the effects of buying and selling remain for years.  They are important decisions and likely require the knowledge and insight that an experienced, trained and educated professional can provide.

I tell my clients that I cannot guarantee that their house will sell if it is on the market but am fairly certain that it won’t if they keep it off the market.  Anyone trying to sell now may have less competition and more offers to consider.  Buyers may have more competition and fewer houses to consider.  Hiring an experienced, trained and educated professional is more important than ever.

Despite the pandemic, every house will not sell.  Houses may get showings without generating offers unless buyers think they are priced within the range of their perceived “worth”.  Most property listings whose contracts are canceled or allowed to expire have asking prices considered high for their local market and/ or they were poorly marketed, meaning that some buyers and agents may not have even known that a property was available to look at or purchase.  Some buyers may even make “full price” offers just to control the process only to have remorse later as inspection results are revealed.

If a market has a lot of inventory, some buyers may not be willing to look at houses priced high compared to the rest of the market:  why try to negotiate a price down when other similar properties are available at more competitive prices?  Many sellers open to negotiating their price will never get the chance.  I will be happy to discuss specifics with you.

Statistics aside, what are you planning to do?  Real Estate is generally a long-term investment unless you are looking to fix and flip it or planning to move within a short period of time.  There are always opportunities out there.  As with the stock market, it is very difficult to pick the best time to make a move.  All you can do is get the best available information, determine what is in your best interests and then start the process.  Getting started is easy once you take action.

If you want or need to sell any type of Real Estate, now or in the future, whether you tried and did not succeed before or are planning for the first time, it is never too early to start the planning and preparation.  Please do not wait for what you think is a better or the best time to start.  Buyers look all year long and can only see and buy properties that are available to see.  Based on what we experienced in 2020, is waiting for Spring something you would consider?

There is no time for inexperience, empty promises or false expectations!

HIRE WISELY:  We are not all the same!

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How Buyers Bought Real Estate in 2020: Who is the Typical Buyer?

NAR or the National Association of REALTORS has released its 2020 Profile of Home Buyers and Sellers.  The profiles are based on a survey using 131 questions mailed to over 132,550 recent home buyers who also purchased a primary residence between July 2019 and June 2020.  The focus of this article will be buyers who sold one home to buy another.  This was a national survey so your market may be quite different.  Real Estate is local:  there is no national Real Estate market so please contact me for information about your local market.

NAR conducts their survey annually.  This year’s results were unique as it was impacted by the pandemic starting in March of 2020.

As I learned years ago, buying a home is an emotional decision justified with logic.  Your home is typically your largest asset and picking the “right one” involves many lifestyle factors.  The buying process can be interesting enough when there is only one buyer involved, however, there are often situations involving more than one buyer.  Family and friends may also be involved.  People have different ways of making decisions and we all handle challenges and stress differently.  Buying a home typically offers plenty of both.

• 31% were first-time buyers, compared to 33% in 2019.  The historic number has been 40%;
• The typical buyer was 47 years old (33 for first-time and 55 for repeat buyers), with those aged 25 to 34 accounting for 23% of all sales;
• The primary reason for buying was the desire to own their own home:  the numbers were 64% for first-time and 27% for repeat buyers;
• 85% purchased existing homes, 15% purchased new construction;
• 81% purchased detached, single family homes;
• Buyers moved a median distance of 15 miles while those who sold one primary residence to buy another moved a median distance of 20 miles;
• The median purchase price was $272,500, up from $257,000 in 2019 ($230,000 for first-time and $297,000 for repeat);
• Buyers typically paid 99% of the asking price; 15% paid more than asking;
• Buyers expected to live in their home for a median time of 15 years, 10 years for first-time and 15 for repeat, with 21% saying they would never move;
• 43% started their search online while 18% contacted a Real Estate agent;
• 91% found their agent to be a very useful or somewhat useful source of information;
• Buyers typically searched for 8 weeks and saw 9 houses, 5 of which were only viewed online;
• 97% of buyers used the Internet, the increase likely related to the pandemic;
• 64% were very satisfied with the home buying process;
• 88% used a Real Estate agent, 6% used a builder and 5% bought from the previous owner;
• 51% prioritized hiring an agent to help them find the right home;
• 87% financed their purchase with 95% of first-time and 83% of repeat typically financing 88% of the price.  First-time buyers financed 93% of the price and repeat buyers financed 84%;
• 11% said that saving for a down payment was the most difficult step.  47% of them cited student loans as a problem with 43% citing high rent/ mortgage payments and 36% citing credit card debt;
• 83% view a home purchase as a good investment;
• Buyers typically searched online for 3 weeks before contacting an agent, two weeks during the pandemic;
• 72% of first-time buyers were renters, 72% of repeat buyers owned their previous residence;
• As far as motivating factors influencing location:  62% prioritized the quality of the neighborhood, 45% convenience to their job, 43% the affordability of the house;
• As far as characteristics of the home and how they compromised:  23% prioritized price, 20% condition, 31% did not compromise;
• 53% of buyers said that finding the “right property” was the most difficult part of the process, 26% mentioned financing (including saving for a down payment (13%), getting a loan (8%) and the appraisal (5%)), 17% cited the paperwork and 15% mentioned understanding the process.  20% reported no difficult steps, which was common for repeat new home buyers;
• 56% walked through homes they found online, down from 65% in 2019, 37% drove by to look at the exterior and did not go inside.  Driving through a neighborhood to see if it meets your needs is an excellent way to narrow your focus while perhaps seeing areas you may not have been considering.  Many buyers eliminate houses after seeing the exterior;
• For internet “shoppers”, 89% found photos and 86% found detailed property information very useful;
• 64% were “very satisfied” while 30% were somewhat satisfied and 7% were dissatisfied;
• 59% signed an agency representation disclosure at some point with 27% signing at the first meeting, 23% signed when their purchase contract was written, 11% signed at some other time.  28% had no representation agreement;
• 51% of buyers wanted a Real Estate agent to help them find the right house, 24% wanted help negotiating (13% mentioned “terms” while 11% mentioned “price”), 8% wanted help with paperwork and 6% wanted help valuing comparables;
• The top benefits Real Estate agents provided were:  62% said helping buyers understand the process, 61% said pointing out features or faults with properties, 48% said negotiating better terms, 47% said providing a list of service providers, 37% said negotiated a better price and 30% said shortened the home search;
• Buyers ranked a number of agent qualities as “very important”:  98% want honesty and integrity; 93% want them to be knowledgeable about the process; 93% want them to be responsive; 88% want communication skills, 83% want them to be able to negotiate and 48% mentioned technology skills; 
• The median down payment was 12% for all buyers with 7% for “first-time” and 16% for “repeat”;
• 28% found the mortgage application process to be much more difficult than expected with only a 1% difference between first-time and repeat buyers. 

Buying Real Estate is unique compared to most typical purchases:  not only is it done much less frequently than other purchases, it typically involves multiple steps, each offering its own challenges.  If you would like to discuss selling or buying or if you have any questions about the process, please contact me.

There is no time for inexperience, empty promises or false expectations!

HIRE WISELY!  We are not all the same!

How Sellers Sold Real Estate in 2020: Who is the Typical Seller?

NAR or the National Association of REALTORS has released its 2020 Profile of Home Buyers and Sellers.  The profiles are based on a survey using 131 questions mailed to over 132,550 recent home buyers who also purchased a primary residence between July 2019 and June 2020.  The focus of this article will be buyers who sold one home to buy another.  This was a national survey so your market may be quite different.  Real Estate is local:  there is no national Real Estate market so please contact me for information about your local market.

NAR conducts their survey annually.  This year’s results were unique as it was impacted by the pandemic starting in March of 2020.

• The typical seller was 56 years old and had lived in their home for 10 years;
• Sellers aged 18-34 sold within 5 years, those 65 and older sold within 16 years;
• 69% had sold a home before and 31% had not;
• 80% of the homes sold were single, detached;
• 70% bought in the same state and the typical distance moved was 20 miles, 16% moved to another region, 14% stayed in the same region but in a different state;
• 44% bought a larger home, 30% bought a similar size and 28% bought a smaller home;
• 61% bought a newer home than they sold, 21% bought one the same age, 26% bought an older home;
• 49% spent more than their selling price, 23% spent the same, 27% spent less;
• The most commonly cited reasons for selling were to be closer to friends and family (15%), to buy something larger (14%), and a change in their “family situation” (12%);
• 89% used a Real Estate agent, 88% used the MLS, 68% used yard signs;
• 22% wanted to sell within a specific timeframe, 21% wanted help with pricing, 17% of sellers wanted help marketing their home, 16% wanted help with ways to sell it for more, 11% wanted help finding a buyer;
• Houses typically sold within 3 weeks and achieved 99% of their final asking price.  Homes on the market for 2 weeks or less got full price, 29% sold in less than one week and got more than the asking price;
• The typical selling price was $242,300:  pre-pandemic median @ $270,700 compared to $300,000 later;
• The reported level of urgency rose after the pandemic, 46% compared to 39%;
• The median equity in a sold home was $66,000;
• 46% used incentives to attract interest.  The top two were offering seller assistance with closing costs and home warranties;
• 69% were very satisfied with the process, 21% were somewhat satisfied, 10% were dissatisfied;
• Only 8% sold without an agent, the lowest share since this survey began in 1981;
• The typical FSBO was 57 years old;
• The typical FSBO selling price as $217,900, more than 10% less than Real Estate-assisted sales ($242,300);
• 77% of FSBO homes old within two weeks likely because they sold to someone they knew (51%) and sold for less.

The bottom line is that selling your home or any piece of Real Estate can be a very confusing and emotional process.  This NOT a retail transaction!  I respectfully suggest that you hire an experienced, trained and educated professional whom you can trust to sell what is likely your largest asset.  I understand that signing a formal contract with someone, even if recommended to you, is quite a leap of faith.  Most of us can offer options to increase your comfort level.  After all, we want to make sure that you “fit” with us as well.

Selling Real Estate is unique compared to most typical purchases:  not only is it done much less frequently than other purchases, it typically involves multiple steps, each offering its own challenges.  If you would like to discuss selling or buying or if you have any questions about the process, please contact me.

There is no time for inexperience, empty promises or false expectations!

HIRE WISELY!  We are not all the same!

Bright MLS November 2020 Residential Housing Report

Showing Time, using Bright MLS statistics, has released their Local Market Insight report for single family homes in Delaware County Pennsylvania through November 2020.  If you would like information about this or any other County or any specific municipalities in the Delaware Valley, please contact me or visit my web site, AndrewWetzel.com.  I am only a text, email or phone call away!  I respond promptly to all inquiries.

The overall market continues to be affected by the pandemic and resulting economic impact.  However, generally speaking, the results in many areas are encouraging and, as always, your experience may differ depending on your location and how you have been personally impacted.  As I always say, the decision to buy or sell Real Estate is a personal one and the current environment typifies that.

The report compares current year-to-date results to one-year ago, same time period.  As with all Real Estate statistics, two things are true.  First, the performance within individual zip-codes can and will vary significantly from the overall County.  Real Estate is local and results can vary from neighborhood to neighborhood and even block to block.  There is no such thing as a “national” Real Estate market any more than there is a national weather forecast so, whether you may be thinking about selling or buying, please contact me for details about your areas of interest.  I can provide current information and keep you informed about the evolving market.  Deciding whether it is the right time to sell or buy is a personal decision typically involving a number of variables.  I can provide the knowledge and insight to help you decide what works for you.

My second point is that, unfortunately, all Real Estate statistics involving sold data are stale.  This is especially true if you are relying on Internet valuation models which use recorded data rather than up-to-date MLS information.  Even then, while a sale may be reported as settled or closed today, the real question is when was the offer negotiated?  Typically, sales can take 45 to 60 days to close so the market today may be different from when the offer was presented and negotiated.  Up-to-date information, even if not perfect, is important!

As far as the statistics, there were 7911 units listed for sale through November 2020 compared to 8661 listed through November 2019, a decrease of 8.7%.  Low inventory levels are the cause of related data points.  There were 6379 closed sales through November 2020 compared to 6381 through November 2019, a negligible decrease.  The median selling price through November 2020 was $252,000 compared to $226,000 through November 2019, an increase of 10.6%.  The large decrease in properties being listed had a relatively small effect on the number sold while substantially increasing their selling prices.  The number of currently available properties is well below one year ago and the Days on the Market (DOM) and “Sold to List Price” ratio are much improved.  Do we have an inventory problem or pent-up demand?  Again, these numbers vary throughout the County:  the underlying data shows a wide range of results in all categories among the 49 different municipalities in Delaware County.

Generally speaking, low inventory levels in some areas have produced multiple offers and a frenzy among buyers, some of whom may live to regret a hasty decision to get a property under contract.  During the shutdown when “in-person” Real Estate activity was not permitted, many buyers made offers “sight unseen”, some without inspections to improve their odds.  The effects of that remain to be seen but Real Estate, perhaps with the exception of those properties acquired strictly as “investments” with documented income, is generally not something given its expense and complexity that the typical buyer would want to purchase without an in-person showing let alone removing the protection of an inspection contingency.  Technology, however advanced, has its limitations.

What about the properties that did not sell?  Many came off the market and remain unavailable.  As the pandemic has evolved, some properties did come back on the market but many have not.  Did owners delay, change or give up their plans?  Buying activity has been strong but the sellers may be reluctant to allow showings or may have issues they are dealing with.  My only concern is whether people are making an informed decision or reacting to what they “think” is happening in the market.

Buyers and sellers need to do the same planning and preparation that those tasks typically require.   Anyone looking to sell or buy needs to understand their local market and decide how to react to the pandemic as a “variable” that was not here last year and, hopefully, will be gone in the near future.  However, the effects of buying and selling remain for years.  They are important decisions and likely require the knowledge and insight that a professional can provide.

I tell my clients that I cannot guarantee that their house will sell if it is on the market but am fairly certain that it won’t if they take it off the market.  Anyone trying to sell now may have less competition and more offers to consider.  Buyers may have more competition and fewer houses to consider.  Hiring an experienced, trained and educated professional is more important than ever.

Despite the pandemic, every house will not sell.  Houses may get showings without generating offers unless buyers think they are priced within the range of their perceived “worth”.  Most property listings whose contracts are canceled or allowed to expire have asking prices considered high for their market and/ or they were poorly marketed, meaning that some buyers and agents may not have even known that a house was available to look at or purchase.  Some buyers may even make “full price” offers just to control the process only to have remorse later as inspection results are revealed. Of course this may well depend on the ratio of buyer and sellers so there is more to this than raw statistics.

If a market has a lot of inventory, some buyers may not be willing to look at houses priced high compared to the rest of the market:  why try to negotiate a price down when other similar properties are available at more competitive prices?  Many sellers open to negotiating their price will never get the chance.  I will be happy to discuss specifics with you.

The overall economy is coming back but many are still hurting financially.  Statistics aside, what are you planning to do?  Real Estate is generally a long-term investment unless you are looking to fix and flip it or planning to move within a short period of time.  There are opportunities out there.  As with the stock market, it is very difficult to pick the best time to make a move.  All you can do is get the best available information, determine what is in your best interests and then start the process.  I am a phone call or email away and getting started is easy once you take action.

If you want or need to sell any type of Real Estate, now or in the future, whether you tried and did not succeed before or are planning for the first time, it is never too early to start the planning and preparation.  Please do not wait for what you think is a better or the best time to start.  Buyers look all year long and can only see and buy properties that are available to see.  Based on what we experienced in 2020, is waiting for Spring something you would consider?

There is no time for inexperience, empty promises or false expectations! 

HIRE WISELY:  We are not all the same!