SPECIAL REPORT Lack of supply creates Mercer County housing shortage, higher prices

May 21—Housing availability in Mercer County is no longer in bad shape: "It's dire," said Rod Wilt, executive director of Penn-Northwest Development Corp.

Local Realtors agree. And the lack of housing availability is across the board — condos, town houses, residential homes and apartments are all in severe short supply, they said.

A sharp home placed on sale at a reasonable price generates a frenzy among buyers, said Jan Jaussen, a Realtor at Howard Hanna Bainbridge Kaufman's Greenville office.

"It's like watching piranhas converge," Jaussen said.

On Friday, the number of active homes in Mercer County on the Multi-List, where real estate agents list properties for sale, totaled 132.

"Three years ago there would be hundreds and hundreds of homes on the list," Nancy Schlegel, a Realtor and sales manager at Berkshire Hathaway's Hermitage office, said.

It's worse in hot spots like Hermitage.

On Friday, only 11 Hermitage homes were listed for sale, Jeff Shaffer, a Berkshire Hathaway Realtor, said.

"Five years ago it would be nearly 100," Shaffer added.

And that has driven up prices.

Ranch-style houses are particularly prized.

A two-bedroom, 1 1/2 -bath, ranch home with an unfinished basement on North Buhl Farm Drive in Hermitage was on the market for just two days earlier this month before it sold.

"This is a basic starter home," Shaffer said.

The house listed for $155,000. Shaffer said he wasn't permitted to give the actual sales price as the agreement hasn't been completed yet.

Three years ago that same house would likely have fetched $125,000, Schlegel said. Comparing those two price points reveals a 24 percent price increase, or an 8 percent annual increase.

That's way above the area's traditional 2 to 4 percent annual rise, Schlegel said.

She added that an updated, three-bedroom ranch home with two bathrooms, a finished basement in a good Hermitage neighborhood runs $250,000.

Condo availability is at rock-bottom levels, Shaffer said.

"There are only four condos for sale in all of Mercer County, and only one in the greater Shenango Valley area," he said.

Renting a condo is practically impossible.

"For a $1,000-a-month condo rental, there's over a two-year waiting list," Jaussen said.

When it comes to home sales she always tells clients Greenville usually has better prices than Hermitage.

Multiple reasons are given for the housing shortage. Atop the list is a lack of new housing construction.

As head of Penn-Northwest, Mercer County's lead economic development agency, Wilt said he's spending more time to attract housing developers to the area.

"There's no question the housing demand is here waiting for them," Wilt said.

Also, national mortgage interest rates have jumped over the past five years from around 3 percent to the current 6.5 to 7 percent rate. People living in a home with a 3 percent mortgage rate who may want to move into a better home aren't willing to sell because they would have to buy a home with a much higher mortgage rate, Jaussen said.

Even if a homeowner is willing to sell, they face a big obstacle.

"There's no place for them to go to here," Julie Cylenica, manager and associate broker for Howard Hanna's Hermitage office. "Everything is pretty much occupied."

The Mercer County government's decision to undergo a property reassessment, the first in over 50 years, has created a little apprehension among current homeowners who were thinking of moving up to pricier homes, Realtors said. Mercer County commissioners on Thursday awarded a contract to begin the reassessment.

Real estate agents said buyers from Pittsburgh and other cities have been snapping up local properties. Some are willing to make the long commute. But it's also because businesses are more willing to let employees work from home.

And, of course, local prices are a huge lure.

"We have lower home prices and lower cost of living here," Cylenica said.