NEPA housing prices rise while national figures slide
Landview Properties—02/27/2008—As seen in the Citizens Voice
BY DAVID FALCHEK
STAFF WRITER
02/27/2008
As housing prices slide in other parts of the nation, prices in Northeastern Pennsylvania had a healthy increase in 2007.
Nationally, home prices buckled under the subprime mortgage and foreclosure crisis, forcing prices down nearly 9 percent in the fourth quarter, according to the Standard & Poor's Case-Shiller index released Tuesday. Last year, some communities in California watched home prices plummet by as much as 20 percent.
But things are different in the Scranton/Wilkes-Barre metropolitan area, where home prices in 2007 increased 7.2 percent, according to another index released Tuesday. The Office of Federal Housing Enterprise Oversight ranked the metro area 18th in home price gains among the nation's 291 metro areas. Scranton/Wilkes-Barre shared the top 20 with other low-profile markets such as Bismark, N.D., Longview, Wash., and Beaumont, Texas.
Nationally, home prices fell three-tenths of a percent in 2007, according to OFHEO. The local housing market is largely insulated from national trends. Since Scranton/Wilkes-Barre hadn't enjoyed the price surge, it's not suffering the slide.
In addition to gaining value last year when the national average fell, Scranton/Wilkes-Barre price growth also beat the state's average growth of 2.8 percent for 2007, according to OFHEO.
Joyce Cornell, broker at Coldwell Banker Town & Country in South Abington Township, isn't surprised by the region's good showing in a down housing market. Last week, she attended a trade event in Florida. The same agents from the Sun Belt she envied four and five years ago during the boom, she pitied as she heard their tales of woe in a collapsing market.
"Those markets had price gains that were unsustainable and unrealistic and they had to fall," Cornell said. "Our market is stable and our prices are grounded in reality."
But locally, the market faces an oversupply and remains short on buyers, even as mortgage interest rates have declined again to under 6 percent. Local real estate agents said prices have regulated, and more sellers are having to slash asking prices. The oversupply and slow turnover could slow price growth in 2008.
In some cases, prices have slid. Cornell said her agents are using comparable properties from 30 or 60 days ago rather than nine to 12 months ago. That reflects the current market, rather than the rosy one last year.
Buyers are waiting on the sidelines for the market to bottom out, but she thinks the market will pick up sometime this year.
Charles Hibble, of Weichert Realty in Scranton, said more troubled homeowners desperate to unload their homes are affecting the local market. What will happen in 2008, he said, is anyone's guess.
"We will know when spring comes and historically people start home shopping," he said. "There are so many great deals on houses and low interest rates. If you have credit and cash, you have to be nuts to sit this market out."
OFHEO regulates Fannie Mae and Freddie Mac and its index tracks homes that meet their loan standards, so they don't include subprime loans and jumbo loans over $417,000 that have brought down the "bubble" markets.
