York Co.'s housing market: The good, the bad, and the unknown

Home sales data offered mixed news for 2010, and most
economists believe it will be a buyers market in 2011.

by Shanna Wiest

Anyone who pays attention to news about the housing market hears a lot of gloom and doom. As we look ahead to 2011, let’s take a look at the good, the bad and the unknown in the housing recovery.

The Realtors Association of York and Adams Counties recently released its annual market report, which looks in detail at home sale activity and new construction by school district. According to the report, 3,771 homes were sold in York County, a 7 percent decrease from 2009. The bad news is this was a 10-year low in the number of homes sold.

The median home sale price was $153,000 in 2010. This reflects a 4 percent decrease from 2009, a 10 percent decrease from 2006, and an increase of 39 percent from 2001. According to the Pennsylvania Association of Realtors, homebuyers stay in their home an average of 10 years. The good news is, in spite of the recent declines, real estate continues to be a stable long-term investment.

During the first half of 2010, the home buyer tax credit encouraged sales and led to moderate increases in home sale prices. However, when the tax credit expired in April, home sales and prices dropped during the latter half of the year.

Distressed sales such as foreclosures and short sales also hurt the market throughout 2010. According to the York County Prothonotary’s office, there were 2,080 foreclosure filings in 2010. The good news is this is a 2 percent decrease from 2009 and a small step in the right direction for York County.

The state Realtors group also commissioned a survey on foreclosures in the Commonwealth and found the top two factors leading into foreclosures were job loss and medical bills. As long as people are without jobs or fear losing their livelihoods, they are unlikely to buy homes. The silver lining: York County had baby-step improvements in the job market in 2010. According to the Pennsylvania Department of Labor and Industry, the county unemployment rate fell to 8.8 percent in November after reaching 9.3 percent in October. The county also gained 100 jobs in November. The potential upward trend in the job market has led to optimism in local economic recovery.

A bright spot in the housing market is that affordability conditions are high. With more choices in inventory and historically low interest rates, homebuyers are in a great position to get more home for their dollar in York County.

It is anticipated that the housing market will continue its recovery next year. Most economists expect housing will remain affordable in 2011, but that’s not a sure bet. One thing is certain: Steady improvements in the economy, including local job growth, will be necessary to bring buyers into the market.

Shanna Wiest is the government affairs director for the Realtors Association of York & Adams Counties and has been with the association since 2005. In her position, she advocates for homeownership, economic development and smart growth planning. Shanna also serves as the secretary/treasurer for the York/Adams Regional Smart Growth Coalition and the president elect of the Economics Club for the York County Chamber of Commerce. Shanna earned a bachelor’s degree in economics from Dickinson College and her Master’s of Public Administration from Penn State University. Shanna lives in Springettsbury Township with her fiancé Joe.