Saucon Valley Property Pulse: August 2023

Editor’s Note: Saucon Valley Property Pulse is a regular sponsored column, exclusive to Saucon Source, featuring expert insight and analysis of the real estate market by realtor and Lower Saucon Township resident John Cummings. Whether you’re looking to buy, sell or are simply interested in local housing trends, we hope you’ll find the information in it useful and share it with others. The data referenced below, for the month of July 2023, is the most recent available. Subscribe to the free Saucon Source newsletter to stay up to date on local real estate and other news.

Continuing on our 2023 housing market journey, we are seeing much of the same at the start of the second half of the year. Both buyers and sellers remain at a standoff as home prices remain high and unaffordability remains at all-time lows, but one thing that seems to be stabilizing is interest rates. The Federal Reserve has been true to their word up to this point, breaking their rate hiking cycle trend in their attempt to curb inflation, which remains around 3.2 percent. What does this mean for us in Saucon?

As we discussed in our last edition of the Property Pulse, homes in Saucon Valley and Southern Lehigh school districts have been and remain in the top five areas for median home value, which ultimately also makes Saucon one of the most unaffordable areas in the Lehigh Valley. Has this scared buyers away?

A look at some key takeaways

National housing sentiment is still at an all-time low

Why?

• High home prices plus high interest rates are equaling unaffordability for many would-be buyers
• High interest rates have deterred would-be sellers from listing their homes, as they would be paying more for a mortgage on a similar property
• Property values continue to rise, which is deterring some from selling due to fears of missing out on getting the best price.

Is this scaring buyers away in Saucon?

The average days on market is still telling us that we are far from a balanced market and that when homes are listed, they are sold–and fast.

How about the listings over these numbers?

In terms of properties listed for sale for longer than average, there were recently 42 active listings in the Saucon Valley and Southern Lehigh school districts. Of those listings, 32 were new construction, five would be considered “investment” properties, two would be categorized as “luxury” listings (with prices of $1 million or more these properties normally take longer to sell) and only three were listings I would categorize as “average” listings.

With that said, if your home isn’t selling in this type of market, give me a call because there is obviously a problem!

Some further evidence that buyers have not been shaken from the Saucon area can be gleaned from our closing rate, as shown below.

If you’re considering selling, but were hesitant based on the buyer pool, Saucon doesn’t seem to be affected right now.

Home values continue to climb

In addition to selling quickly, home values continue to remain high.

Things to monitor

Banking issues

Have you ever wondered how these rapidly changing interest rates affect your mortgage company? Probably not, but it does matter. Likely, in the past two to three years you have taken advantage of a 30-year fixed loan that was below 5 percent. This has also caused many potential sellers to stay put. With that said, loan origination and refinancings have decreased rapidly. With loan origination costs increasing and business rapidly decreasing, many banks face challenges with loan profitability. So how does this affect you?

1. It’s more difficult and expensive to get home and business loans.
2. Economic suppression.
3. Fewer banks means less competition, which results in overall higher costs for the consumer.

Seasonal housing trends

The typical housing market in the Lehigh Valley is as shown in this Historical New Listings by Month chart featuring data for the period 2005-2023.

We are currently coming to the peak of our year in terms of listings. As we enter the fall season, we will likely see even fewer listings, which may drive home values even higher as supply gets further restricted.

What this means

For homebuyers

Unfortunately, if you are looking for a home in Saucon it doesn’t look like the remainder of 2023 will be any easier for you. As we have already hit our traditional “peak” period for listings, you will likely be facing more competition as we move through the second half of the year.

For homeowners and sellers

If you are going to be selling in the next two to four months, be prepared for many showings in a short amount of time. Be willing and expect to have to leave home for a full day on both Saturday and Sunday, when many home shoppers are out looking at properties.

For investors

Highly appreciating homes are good news for flippers, however it will be extremely difficult to get your hands on a rental in Saucon as increases in both interest rates and home values make it more challenging to justify with rents that cannot keep up.

About the Author

Hey there, I’m John Cummings, and I’m thrilled to be your local Saucon Valley real estate expert! As a proud resident, I feel incredibly fortunate to have discovered this charming community alongside my wonderful wife and three boys. My mission is simple: to share the joy and excitement of living in Saucon Valley with you and your family. Whether you are looking to buy or sell a home, I am dedicated to making your real estate journey a seamless and rewarding experience. With a deep understanding of the local market and a passion for helping families like yours, I’ll go above and beyond to find the perfect home that matches your needs and desires. I believe that finding the right home is not just about the property; it’s also about finding the perfect place to create cherished memories and build a fulfilling life. When I’m not busy making real estate dreams come true, you can find me exploring the beauty of Saucon Valley with my family, attending community events and giving back to the place we proudly call home.

Phone: (484) 280-8433
Office: (610) 882-1653
Email: Jo*************@gm***.com
YouTube: @Johncummingsrealtor

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