State of the Market
The November Market Stats for Lancaster County (MarketStats by Showingtime) show that the average Sold to Original List Price ratio was 101.3% for the month. Homes were on the market an average of 17 days and the Median Sold Price was $295,000, up 9.3% from a year ago.
29.2% of November’s closed sales were cash, 56.9% were conventional, 7.1% were FHA, 4.8% were VA and the remaining 2% were other.
Does this sound like a competitive market? Almost a third of sales were cash and less than 14% of sales accepted FHA or VA financing. Homes are still selling for over list price; they are selling quickly, and they are selling to predominately to cash and conventional buyers. It continues to be a very competitive market.
The definition of a balanced real estate market, that does not favor buyer or seller, is usually between five and seven months of housing inventory. If inventory levels exceed seven months, demand is low and prices are likely to fall which creates a buyer’s market. When inventory levels fall to less than six months, sellers have more control which results in a significant rise in housing prices which is a seller’s market (Texas A&M University Real Estate Center).
In the Lancaster market in November, there were 390 closed sales and an average of 460 active listings. This means there was just over one month of inventory available, which points to a very strong seller’s market.
I’m sure it is difficult to imagine a buyers' market right now. Five to seven months, or more, of inventory available, yet very few buyers interested. This was the experience during the great recession, but it is not even close to the current situation. Despite higher interest rates and counter to some of the national news about a declining real estate market, Lancaster remains a very strong seller’s market.
What does this mean for us as we head into 2023 working in Lancaster County? Monitor the monthly statistics to keep your finger on the pulse of our market. The market will continue to change as interest rates increase or decrease and as we begin to enter the spring market, which traditionally is our busiest time of year. Don’t expect the sky to fall, our inventory levels would have to skyrocket for the overall seller’s market conditions to wane. Be prepared to continue to manage multiple offer situations as both a buyer agent and seller agent. Encourage your buyer and seller prospects to jump into the real estate market. All indicators show that it is a great time to sell a home. There is little evidence showing that prices will have any reason to decline, so it’s a great time to buy a home as prices are still going up.
The bottom line is, don’t buy into the negative national news about housing. Housing markets are local and our market is strong and stable.
Facts, opinions and information expressed in the Blog represent the work of the author and are believed to be accurate, but are not guaranteed. The Lancaster County Association of Realtors is not liable for any potential errors, omissions or outdated information. If errors are noted within a post, please notify the Association. Posts represent the author's opinion and are not necessarily the opinion of the Association.
