Over the last several months I have often had comments from friends, family, and people on the street about the state of the current real estate market. They say to me "prices are going up, aren't they?"...and my answer is "yes and no". The receipt of this statement is usually followed by a slight head tilt, cocked to one side and eyebrows that furrow to complete a look of perplextion. With all of the talk in the media about home prices rising by 16% it is no wonder everyone around me is confused. A 16% increase being tossed around on TV sounds all fine and dandy and might make you start to feel good about your current equity status but don't let what you are hearing in the news artificially inflate your confidence in your homes current value. I am not trying to burst anyone's bubble. I am just trying to give a realistic expectation. Don't worry too much, there is good news.
First, remember that in the "news" they are usually talking numbers nationally. 16% increase is very accurate if you reside in certain states like California or Washington. The Mid-Atlantic region however, which includes Pennsylvania, New Jersey and New York, they have experienced the lowest increase nationally at only 2.46%. And, that is talking about a large sample area. The percentage of change varies depending on not only the state but the county you are located in and in some cases the zip code. In fact, if you look at some of the counties in Pennsylvania prices are still going down. Unfortunately detailed reports concerning specific areas are not readily available to the average consumer. Lucky for you they are available to me. As of the last quarterly report released by the TREND MLS on October 10th, the median prices for both Montgomery and Chester counties have increased since last year. Yes! As you will see below Montgomery county saw a 3.7% increase and Chester county which was lagging behind is now at 1.6% increase. Inventory across the board has reduced and the average days on market are down as well.
Is this good news? Yes. Are we out of the woods? No. States that saw up to 16% increases also experienced a devastating fall out. Even though our market's crash was less detrimental we still have a ways to go ourselves. Home values in your area are most likely improving but depending on when you purchased your home you might still have equity concerns to deal with. What is the best way to know for sure? Hire an appraisal or talk to your local realtor about getting a market analysis for your home. They will use a much more accurate technique than the newscasters on TV.
Some agents love to run around screaming "You see, you see, the market is better! It's on the radio!". Trust me, I would love to do that but that still leaves me with the homeowner sitting across the kitchen table from me tilting their head to one side and giving me that same look. Luckily what I can say to them is that the talk they hear in the media is boosting buyer's confidence, and the lower inventory means less competition. It is continuing to improve, check it out....