News

01.28.2008
The Berks County Housing Market - Good News for Home Sellers

Written by: Beeler Communications, Inc.

How many times have you heard the words “housing slump” over the past year or so?

The nationwide slowdown in new-home construction and falling home prices in some areas have been making economic news for months. For those considering a move to a retirement community, those reports have fueled concerns: Can I sell my home in a reasonable timeframe? And can I get a fair price?

But despite the doom-and-gloom reporting about the overall housing market, owners of existing homes can actually take comfort in some very positive signs.

First, while new home construction has indeed plummeted, existing-home sales nationwide for 2007 will total more than 5.6 million units, the fifth highest total on record – and a trend expected to continue during 2008.

More good news for home sellers: Mortgage rates recently fell to their lowest levels since 2005. Lower mortgage rates, of course, enable more buyers to enter the market and enable interested buyers to afford larger homes.

And those are just national trends. Here in the Berks County area, there’s significant evidence that the housing market remains quite healthy. In fact, the National Association of Realtors reports that, between the third quarters of 2006 and 2007, median home prices in the Reading area posted the second fastest growth rate in the entire Northeast.

That robust activity has made national news. In a December segment on NBC’s Today show, Barbara Corcoran, a leading real estate expert, singled out the Reading area as an “up and coming” market. She also predicted prices in our area would continue to rise.

And, in a November 2007 article, Forbes dubbed Reading as one of the nation’s ten “sizzling” housing markets, after posting a one-year increase of 11.2% in home prices. Forbes also noted, “commuters from as far away as New York are resettling here.”

In fact, Eric Miller, a Realtor with RE/MAX of Reading, estimated that about 75% of the homebuyers he now serves come from outside the area. “They’re coming into this area in droves,” said Miller, who was interviewed for the Today segment and has worked in the Berks County market for nearly two decades.

He points out that the average commute nationally is about an hour. That makes Berks County an increasingly attractive option for commuters who work in much more expensive areas of metropolitan Philadelphia and New Jersey. “The cost-structure and demographics of this area are beneficial for long-term growth,” Miller said. “That supersedes everything else that’s going on nationally. The outlook in our region is just outstanding.”

In particular, Miller said existing homes in the $200,000 - $400,000 range continue to sell well, and that prices have remained at a pricing plateau achieved after several years of significant growth. In fact, in January 2008, the average listing price for homes currently on the market exceeded $275,000 in 18 different Berks County ZIP codes.

The future looks bright, too. The Berks County population continues to grow, and is expected to rise to more than 410,000 in 2010 – an increase of 17% over a four-year period.

Another bright spot: relatively affluent households also appear to be on the rise. In 2006, Berks County had 43,000 households with an income of greater than $75,000. That number is expected to rise by 23% — to more than 53,000 — by 2010, according an estimate from the Berks Economic Partnership.

Whether you turn to the latest research, to respected national publications, or to local experts, they all point to the same conclusion: Berks County will remain an active, vigorous housing market, particularly for sellers of existing homes in that key $200,000 to $400,000 range.

So, the next time you hear news reports about a housing slump, remember that certain pockets of the country – including Berks County – are bucking the real estate trends.