Like everything from cars to groceries, home prices in central Pennsylvania are rising, making it harder than ever for house hunters to find an affordable dream home.
Nationally, the median existing home sale price in August climbed to $407,100, the third consecutive month the median sales price surpassed $400,000, according to the National Association of Realtors.
Luckily, median prices are lower in central Pa. In Cumberland County, it was $308,000 in August, while in Dauphin County it hovered around $255,000, according to local real estate data.
So what what kind of home can you expect to buy here for those prices? Basically, a modest home without such bells and whistles as massive gourmet kitchens, multiple car garages or in-ground swimming pools.
“You are going to get your typical cookie-cutter 3-bedroom, 1-bath home. Your typical ranch houses you see that are 1,000 to 1,200 square feet or your Cape Cods. You can get some of your nicer two-story townhouses,” said Danielle Wise, an agent with Better Homes and Gardens Real Estate Capital Area.
For veteran real estate agents like Bill Rothman, founder of RSR Realtors in Lemoyne, prices have always been a hot-button topic. He recalls buying his first home in 1965 for $15,000.
It was a nice 25-year-old three-bedroom, 2-story house on a ½-acre lot in Lower Paxton Township, he said. Looking back, Rothman notes it probably cost the builder about $3,000 to $5,000 to construct and about $500 for the land. Those days are long gone.
A lack of inventory fueled by higher interest rates that are pushing more homeowners to stay put is leading to higher prices and, in some cases, bidding wars, say real estate experts.
“This is constantly in flux,” Rothman said. “The market is still very active and when properties go on the market, there are multiple offers. What has slowed down is the inventory, because people aren’t putting their houses on the market because they don’t want to give up their rates.”
Nationally, the National Association of Realtors says year-over-year pending home sales fell 18.7% in August, over the previous year. Also, a 30-year fixed rate mortgage averaged 7.09% in early August, according to Freddie Mac, up from 6.96% a few weeks earlier and 5.13% a year ago.
For some, the market’s condition creates a barrier to purchasing a home. A study by the National Association of Realtors with Morning Consult shows among prospective homebuyers, including 27% Asian, 24% Hispanic, 20% Black and 15% White, respondents said they are waiting for prices to drop before buying a home.
The market is especially hard for first-time homebuyers, the ones who usually desire houses in the $150,00 to $350,000 price range. Wise cautioned those eyeing newer homes built in the past 20 years are generally going to encounter prices in the high $400,000s, while brand-new construction hits the high $500,000s.
She recently counted 91 houses in Dauphin County selling for between $150,000 and $250,000 and 63 houses in Cumberland County priced between $200,000 and $300,000.
“There’s not a lot of inventory, and especially if they are first-time buyers there is a feeding frenzy,” Rothman said.
As an example of what those median prices will get you here:
- A three-bedroom Cape Cod in Lemoyne built in 1941 recently sold for $299,000 and featured an updated kitchen, hardwood floors, master bath with jacuzzi tub, and large deck with hot tub.
- A bi-level in North Middleton Township near Carlisle sold for $305,000 and featured granite kitchen counters, a newly finished garage and an above-ground pool.
- In Dauphin County, a 1,624 square-foot, 2-story townhouse with three bedrooms, an open living room and a garage in Lower Paxton Township sold for $248,000.
- A well-maintained Craftsman with three bedrooms in Steelton built in 1900 sold for $256,000.
Homebuyers typically have a wishlist of what they want in a new home, but Wise noted in this climate many buyers are willing to concede when it comes to certain requirements, such as the number of bedrooms and size of garage and backyard, just so they can afford a home. Maybe they trade down from a single-family home to a semi-detached or attached home, she added.
“You may not get a finished basement or central air conditioning. You might have an oil furnace. Some things might be a little dated. Maybe you won’t get luxury hardwood flooring. You are going to have to go in and change that shag carpeting and definitely will need to paint,” she said.
Rothman said he’s noticed many first-time home buyers are hesitant about the market.
“You think they give up and then they come back and they give up and they come back,” he said,…
Read More: It’s a ‘feeding frenzy’ housing market. What does the average price in central