BETHLEHEM, Pa. — Real estate activity in the Lehigh Valley remains slow heading into spring, as mortgage rates continue to rise, according to the Greater Lehigh Valley Realtors.
- Real estate activity in the Lehigh Valley continues to be slow heading into spring, with affordability constraints limiting homebuyer activity
- In February, closed sales decreased by 15.9%, and available properties slipped by 2.4%
- Justin Porembo, chief executive officer of Greater Lehigh Valley Realtors, said buyer demand has decreased from peak levels, though prices still are up from a year ago
In February, the Federal Reserve increased its benchmark interest rate by a quarter of a percentage point in an effort to curb inflation. That was its eighth rate hike since March 2022, when the interest rate was almost zero.
Although mortgage rates have dipped slightly from their peak last fall, the National Association of Realtors reported that higher interest rates continue to limit homebuyer activity overall, noting that existing home sales have dropped for the 12th consecutive month.
Locally, while the slight decrease in mortgage rates earlier this year helped some buyers, overall rates still are high enough to cause affordability issues, according to the GLVR.
February in the Lehigh Valley saw closed sales decrease 15.9% to 360 listings compared with 428 listings in 2022, while the median sales price in the area increased by almost $40,000 to $299,275.
GLVR's data also shows that available properties for sale slipped 2.4% to 489 units for Lehigh and Northampton counties.
Other notable housing statistics for February included a 28.9% decrease in new listings to 458 (from 644 in February 2022) and a 9.9% drop in pending sales to 501.
GLVR Chief Executive Officer Justin Porembo said buyer demand has decreased from peak levels, causing home price growth to slow nationwide, although prices remain up from a year ago.
Sellers have been cutting prices and offering sales incentives to attract buyers, who are struggling with affordability challenges. With rates ticking up again in recent weeks, buyers are once again pulling back, causing sales activity to remain down heading into spring.
"While rates are significantly higher than the previous year, they are still considered historically low.”GLVR President Howard Schaeffer
“There’s no one-size-fits-all answer to when it’s the best time to buy a home, as everyone’s circumstances are different,” GLVR President Howard Schaeffer said. “But while rates are significantly higher than the previous year, they are still considered historically low.”
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