With the holidays approaching, home buyers may think now isn't a good time to go house shopping.
Think again, Bucks Realtors Joseph Knowles and Deborah King say. With conventional 30-year mortgage rates taking a slight dip below 7% and many people taking a house-hunting break, those who do venture into the market might just get the holiday gift they really want ― a new home.
"It's the best time to buy," said King, a broker with Weichert Realtors in Doylestown. "November and December have been my busiest times ... You only have serious buyers out there and the houses show the best."
But these and other realty agents acknowledge that the inventory of homes for sale in Bucks County has been low. According to the Bucks County Association of Realtors, new listings dropped 17% from September to 667 for the month of October and that is a 26.6% drop from the inventory for October 2021.
Bucks County real estate market open to more buyers
Last year, when the market was red hot and mortgage rates were at 3% or lower, potential buyers who were planning to use an FHA or other mortgage that didn't require a large down payment were overlooked in the bidding by sellers favoring buyers who put down larger deposits ― had more skin in the game, so to speak.
Now FHA mortgages that only require a 3.5% down payment are making a comeback, Knowles said, and these cash-strapped buyers, who are often first-time and younger buyers, have more opportunities to close a deal because the higher mortgage rates have reduced the number of people who can afford to buy a home right now.
"I've been busy. The interest rates have dipped under 7% and the competition is less," said Knowles, an associate broker with Re/Max Realty Services in Bensalem, where he also is a township councilman. "Houses that are priced right are moving."
Bucks County home prices have dipped slightly
Data released by the Bucks County Association of Realtors for October show that home prices dropped by 4.1% in October compared to September but are still up 9.2% over last year.
The number of home sales in Bucks County in October was 15% fewer than in September and 32% fewer than a year ago. In all, 6,193 homes sold in 2022 through the end of the month.
King, who has worked in real estate for 38 years, said it's still a sellers' market with a 17-year peak in pricing that should entice potential sellers to put their houses for sale. And she advised buyers not to get too worried about interest rates.
She remembers when the mortgage rates were approaching 20% and homes were still being built and selling "like hotcakes." She advised those looking for homes to buy because she can't foresee interest rates dropping as low as they were last year anytime in the near future.
Bucks County market insulated from 'wild swings' in housing prices
Jeff Macdonell, vice president of Berkshire Hathaway Fox & Roach Realtors in Yardley, said Bucks County has a stable real estate market because of its centralized location near Philadelphia and New York as well as Princeton, New Jersey, and the large commercial centers in Montgomery County.
"It's very good for commuting," he said, which has insulated the county's housing "from the wild swings in the market."
Still, housing inventory has been tilting slightly more to accommodate buyers. They no longer have to forego a home inspection to close a deal on a house, although there still could be competition when a good property, priced right, is put up for sale. Agents are still seeing multiple offers on homes.
Although interest rates have increased to try to cool inflation, Macdonell said home buyers should still try to get the home they want to live in for several years.
If finances are an issue, he suggested they use a 2-1 buydown where the rate is low for the first year, rises slightly the second and then goes to the full interest rate in the third year. He said this would allow a buyer to qualify for more home and then hopefully be able to meet the higher rate as their income increased or by refinancing to a lower rate in a few years.
"Finding the home is the hard part," he said.
Having a knowledgeable agent can be a real asset.
While she's based in Bucks, King knows the market throughout the Delaware Valley and when Jan Lis and his wife decided to sell their home in Wayne, a friend recommended they use King as a Realtor. She found them a home in Hershey's Mill, Chester County. Lis said he wouldn't have thought to look there without King's help but they are now very happy with their new home. "She was quite efficient ... It went quite smoothly," he said of the transaction.
Tony Verna, who works with King at Weichert, recently sold a new home in Wrightstown to a couple from Texas relocating to Bucks County for a job transfer. The husband saw the house in person while his wife looked at it and several others online before deciding on the Wrightstown property.
"We're very happy. The process was fairly easy," Kim Eagle said, as she unpacked boxes Tuesday. She said they're hoping to have a tree up to celebrate the holiday season in their new home.
Verna said that as a Realtor he knows that while the market changes, it still remains the same: "There's always someone looking to buy and always someone looking to sell. It's a matter of finding the right home for your client."
Tips for homeowners and sellers to avoid emergency repairs
For home sellers and anyone who wants to keep their home in good working order and appearance, and avoid costly repairs, the BCAR offers tips for the fall season.
"Take a walk around your property and determine what needs to be repaired before colder weather comes in. Do your gutters need to be cleaned? Does your roof or chimney need repairs? Are there branches drooping from trees that may be weighed down with ice soon? Now is also the time to store your porch furniture and lawn mower until spring," said BCAR spokeswoman Siobhan Young.
And be sure to check for pipes that could freeze and potential heating problems.
“Inside, consider hiring a professional to inspect your heating system,” said BCAR President Lynn Sharer. “They will make sure it is in good shape and doesn’t need any repairs. It’s important to do this before the temperatures plummet. You don’t want to find out then that your heating system has a problem."
She also advised checking window and door frames to seal gaps that can let in drafts and raise heating bills.
“This is also a good time to check your smoke detectors and fire alarms,” she said. “Test the batteries and ensure they are working properly.”
This article originally appeared on Bucks County Courier Times: Bucks County real estate market strong, inventory still low