What's Moving the Reading-Berks Real Estate Market
If the weather gets as hot as the present real estate market here in Reading and Berks County, you better make sure your Air Conditioner is in good working order. Here is a look at some statistics on what's moving the Reading-Berks real estate market.
People often ask me when is the best time to sell a home here in the Reading-Berks area. My sarcastic answer is "When the market is hot." My seasonal answer is somewhere between April and July. Right now both scenarios are in play.
As of this writing, there have been 1,277 homes sold and settled in Reading-Berks according to the Trend MLS statistics. Over the same period last year, there were 1,377 sales, a drop of 7.2% While the decline in sales is not indicative of a hot real estate market it is to be expected as the number of available homes plummets.
Presently, there are 1,243 single-family homes available. 221 Of these are in the City of Reading Another 214 are not built leaving a total of 808 homes available in all Berks County suburbs. At the end of March 2017, there were 1,641 total homes in inventory (Reading, Berks, and unbuilt). These statistics represent a 24.2% drop in housing inventory overall. If we consider the inventory drop (24.2%) and calculate it into the number of sales in 2018 to date (1,277), the adjusted sales figure would be Approximately 1,550 homes. This figure would be a 12.5% increase in total sales year over year which is much more indicative of a healthy real estate market.
Where things are really heating up in the Reading-Berks real estate market is in the number of pending sales. At the end of March 2017, there were 433 pending homes or homes under contract awaiting settlement. In March of this year, there were 376 homes pending sale or an increase of 9.9% according to Trend.
Looking Behind The Scenes
I believe a robust real estate market needs consistent leadership. This leadership comes in the form of new home and luxury home sales. New homes and luxury real estate are the tides that raise all boats so to speak; they take the lid off the pricing and appraisal kettle.
Last year at this time there were 61 new homes sold in Berks County. This year there are 55. The good part of this is that there are presently 43 new home sales pending. I believe as the weather improves, and how can it not, things in the new home area will get stronger. We are on pace to equal or better last year's total new home sales of 261 units.
The luxury market is the laggard of the group this far. Last year at this time five homes settled over $400,000. This year there are just three sold and settled with five pending sales. Conversely, our neighbor to the southwest, Montgomery County, has 111 sold homes over $400,000 and 156 pending.
The factors Moving the Reading-Berks Real Estate Market continue to be low housing availability. I expect the inventory to increase for seasonal reasons but remain historically low. Rising interest rates are still a positive motivator for buyers to get out and purchase now but that effect will only work until the mortgage rates are too high.
It is my firm belief that high property taxes are negatively affecting both new and luxury home sales. It is just another way our abominably high property taxes adversely affect our whole community. If we are to have a positively sustained housing market here in Reading and Berks County we need to see growth in the new and luxury market going forward. Let's hope our esteemed legislators get the tax situation worked out.
Knowledge is Power!
Jeffrey C. Hogue