A recent CNBC report suggests that higher-end homes ($750,000 and above) are recovering even faster than other homes on the market. In fact, home sales at that price point jumped 50 percent over the previous year. And overall, sales of all homes beat expectations in November 2012 and the trend should continue into 2013 as well. Even with the impacts of Superstorm Sandy along the East Coast and throughout the Northeast, home sales are still strong in that region, including Central Pennsylvania.
The CNBC article states that the median home price nationally (median defined as half selling higher and half selling lower) is currently at $180,600, a 10.1 percent increase from November 2011. The median home price in Central PA and Lewisburg, PA in particular, is very close to this national median home price, and homes sales have remained strong.
Contributing Factors
While there are a number of factors that go into the health of the real estate market, sales of higher-end homes is a key component. Sales of higher-end homes impact the nation’s economy and economic growth, because of the trickledown effect that comes along with more expensive homes.
First and foremost, higher-end homes generate larger commissions for mortgage lenders, realtors and attorneys throughout the real estate transaction. In addition, interest payments to financial lending institutions are larger. Even smaller expenditures like lawn care, maintenance and home improvements are more substantial on a larger, higher-end home. That impacts the local and regional economy. When the same trend occurs across the country, the national economy is in turn impacted.
Who are the Buyers?
In urban areas like Las Vegas and New York City, many higher-end homes are still being purchased by flippers, investors who purchase the home, make improvements and upgrades, and within 3 months return the home back to the market.
But the sale of higher-end homes also indicates that more people are “moving up” in the size and price of homes they are purchasing. Banks have an increased willingness to float larger loans to couples and families looking to purchase a larger and more expensive home, and consumer confidence is strong enough that families are willing to take on the responsibility of a larger mortgage. They feel secure in their job and the banks don’t see the loans as such a large risk.
More good news — foreclosures and short sales made up just 22 percent of home sales in November, according to the Realtors, the lowest share in five years. And overall, the supply of all homes nationally is at its lowest level in 7 years, just 4.8 months’ worth at the current sales pace.
Higher End Homes in Lewisburg, PA
Lewisburg offers a variety of homes, from starter homes and fixer-uppers that are reasonably priced ($100,000) to high-end homes at or above $1 million. Most of those high-end homes are located in developments (like Countryside) or are near Stein Lane and the Bucknell Golf Course.
According to the Lewisburg Downtown Partnership, the median home value in the county is $97,000. East Buffalo Township has the highest home values in the county at $143,900. LDP’s website says, “Lewisburg Borough homes are eight to ten thousand dollars higher than other boroughs and townships in the county. Not surprisingly, with its proximity to Bucknell University, the percentage of the population with a bachelor’s and/or a post-graduate degree is substantially higher than the rest of the county. More than 25% of the East Buffalo and Lewisburg Borough populations have college degrees, well over double the median percentage of the county population.”
Because there is such housing diversity in Lewisburg, PA, it’s best to sit down with an experienced real estate agent to discuss your price range and the amenities that are most important to you and your family.
We look forward to working with you!