Lancaster PA Real Estate Blog

As I mentioned yesterday, I was planning to attend the first-ever RE BAR camp to be held today in Philadelphia.  Well, Brian Schulman and I made it through the morning traffic on the Schuykill Expressway and had a GREAT day sitting in with some excellent teachers and more excellent networkers at the offices of the Greater Philadelphia Association of Realtors.

Here's some images I snapped of the day:

As a highlight I also got to meet in person some favorite Blog friends Patricia Kennedy, Teresa Boardman, Audrey Forshey, Jeff Turner, Brad Carroll, Margaret Woda and many other new connections I hope to stay in touch with.

Thanks To Kim Wood, John Lauber and all the team that organized this event!  It was really wonderful.

As a Lancaster Real Estate professional I enjoy attending courses on marketing, sales and real estate education because they keep me sharp and up-to-date.  I'm a research and numbers guy, so any stats and facts/figures makes it even more fun.

Tomorrow is the first (and only) REBAR Philadelphia camp for real estate professionals, and it's being held at the offices of the Realtors Association of Greater Philadelphia.  The event is a self-directed day of seminars, groups and gatherings with the focus on leveraging new technologies and strategies to grow our business.  Oh, and lots of good networking too. 

My teammate Brian Schulman and I will be driving in in the morning, braving the "sure kill" expressway and downtown Philly traffic to make the day-long event along the river.  There will be lots of folks at the camp whom I know from my years of blogging here on Activerain, and many others who will hopefully become new friends!

This morning we had another (#7, to be exact) Lancaster "Tweetup", this round at Square One Coffee on Duke Street in Lancaster City. 

As always, the discussion was awesome and everyone enjoyed reconnecting and make new friends.  I for one was particularly happy to meet Barbara Searles, a longtime Twitter connection whom I had not had the pleasure of meeting in person yet!  She was awesome.

From left to right are: @Wisegrass, @Jeremywalter, @danielklotz, @poservarial, @odonnellsteve, @godesignunit, @christophervogt, @LancasterHomes (me!), @ryansmoker, @keg29180, @bodyworkslancpa, @wrtrtmaus, @shanellelee 

Thanks to all who braved the weather and came out this week!

Not a week goes by when I don't get a call that goes something like this:

"Hi, we're planning to move to the area and would like to look at foreclosures...I found a bunch of homes on the internet that are forclosures...what do you mean those aren't real homes for sale...I found them on the internet!  ...Can I see the foreclosures, please?"

It's a frustrating conversation that ensues as I try to (patiently) explain that a) Lancaster County is not swamped with boarded up homes and 3 foot high grass, and b) that even if they find a "foreclosure" the path to a successful settlement can be far worse than they imagine. 

Yes, yes, I know that you keep hearing about all the foreclosures on TV.  Trouble is, it's not the same real estate climate in Lancaster County as in Detroit or Florida, OK?  I for one am glad about it, too.

What's going on here?  What IS a "foreclosed house" and how do I get one, then?

I try to review the general process that a property goes through as the owner defaults on the loan (for whatever reason - no moral judgements).  What's that process, you're thinking?

When a home goes into foreclosure, it is tied up in a fairly long journey of about 9-12 months of court hearings and administrative limbo.  At some point late in that process it will generally come up at the Lancaster County Sheriff sale where the bank acts as both seller and buyer, taking the property as it's own possession if no other party outbids them. 

After that is all recorded, the bank then farms the hapless property out to an local broker representative who then puts it on the Multiple Listing Service for all buyers and agents to see.  This agent also has to get any occupants out and have the place "cleaned" of debris. 

Generally, the list price at that point is determined by the loan amount the bank is owed - often very close to actual market value anyway.  The listing broker then fights the bank officer to get the list price down enough to reflect condition issues and hopefully gets an offer the bank will accept.  (I know several Lancaster PA real estate agents who do this - not something I would prefer to do.  I'll help buyers, thank you). 

The magic happens when a home comes on the market and the price is right!  When this happens, a good buyer agent will get the buyer in there quick.

There are two ways that the buying public has access to "foreclosures" as they are termed.

1) Attend a Lancaster County Sheriff Sale and purchase one at auction (Auctions)
2) Purchase one through the MLS being listed by a bank or investor for resale (REO homes).

(OK, there's a third way, that I only use with my professional investor clients - it involves letters of credit and intervention at the bank level - not for the faint of heart or the primary home buyer).
 
As a buyer's agent, I work with many "foreclosures" and can say with confidence that Sheriff Sale purchases are risky to the primary home buyer (no guarantees of title, possible unknown liens etc) and time-consuming (there are potentially dozens to sort through and personally visit, many with the owner still there!).  In the end the owner can STILL get the foreclosure delayed and the sale is a bust. 

You are far better off as a single-home buyer to be looking for a bank sale through the MLS, where the seller has cleaned up the title and the contract process is more reliable.

Now, to the business that has caused much of this misunderstanding in the public:
 
One of the major contributing factors to my weekly phone calls are the endless "foreclosure" websites that purport to offer homes for sale and are very successful at sucking people in.  These companies buy lists of properties in the foreclosure process, but not necessarily for sale.  In 99% of the cases the information is either outdated or just plain incorrect.
 
I don't know of anyone who has successfully used "foreclosure websites" as a tool to buy a distressed property.  The most successful approach is to watch the new listings coming on the MLS and note low-priced properties.  These could be foreclosure homes and will likely sell fast if the condition is acceptable.  In any case, without a professional guide it's all too easy to miss the real "deals"...
 
I can certainly understand someone's desire to secure a "deal" for their next home, but as the age-old economic saying goes, "they're ain't no such thing as a free lunch".

Guest Post: Jason Sardi, a PA mortgage professional, wrote a very nice summation for homebuyers:

...So here's one for you! At only $45,000 this is about as cheap as you're going to get right now in Lancaster City.  If you're looking for a rental investment property or a first home, this end-of-row townhouse is at the extreme north end of Plum Street just before it merges with New Holland Avenue.  Here's a photo:

To see the property details click here.  Put a coat of more attractive paint and decent trimwork and you'll improve the curb appeal dramatically...enjoy!  If you'd like to see this home contact me at info@yourlancasterhome.com to set up a showing.

Let's catch up with what's been happening in the Lancaster County PA real estate market, through April.  I'm going to review the last 3 years of data and point out the highlights that are important to you.

Here's the April 2009 Review, first of all.  We can see that a large group of home listings are languishing on the market - new listings are down 20% but ACTIVE listings are up 15%.  That means lots of homes are still here from earlier months.  More Inventory gives buyers more choices.  Note that home prices aren't that far off last year's numbers for April - despite some wild swings in the last six months.  That's good news I'll point out again in a minute.  Lastly, we've seen a 15% bump in Average Days On Market for homes in Lancaster County.  It's just taking a bit longer to get a transaction locked up.  If you're well beyond 77 days for no good reason, it's time to call me about revamping your marketing campaign!  By the way, my personal average for this year is 32.5 days on the market

Now, let's dig into the historical stuff and see what we can learn:

First, Average Home Prices.  There is some good news here, in my opinion.  Looking at the Seasonally-Adjusted Prices, we see that the average list price of new home listings has stabilized after a prolonged rise.  I for one am glad to see this!  I'm tired of dealing with potential sellers who won't look at sales trends.  Trust me, they're still out there - even in my immediate neighborhood some seller just listed (with another agent) for AT LEAST $25,000 too much.  Using comparable sales from last spring is a bad idea!  In any case, the flattening list price curve encourages me that more Lancastrians are listening to the market and pricing accordingly. 

Home Sale prices, of course, continue to decline on average (surprise!).  Still, the slide represents about a 5% falloff - California & Florida eat your heart out!

My last chart is the home sales numbers for three years:

As I've noted on the chart, April 2007 was the peak for home sales in Lancaster County.  Since then its been...a wild ride.  As my silver surfer indicates, sales rode the wave all the way down to a low in January of this year.  Since it is Spring, sales have rebounded but April 2009 barely beat out January 2008!  Things are slow.  Is there a better market?  In my opinion, with all the $$$ out there for first-time homebuyers, things are pretty soft.  I was really hoping to see at least 400 sales by April (remember, there are over 1,000 agents to fight over these 400 homes!).

When it comes to new listings by month, interestingly April 2008 was the peak.  I've called it "the panic of 2008" because sellers were just realizing that 2008 was going to be their last (perceived) chance to get out while prices were up.  The fear of the future drove listings to all-time highs that month.  This year, new listings are quite subdued and tellingly, not climbing. 

What will happen this summer?  The best thing would be for new listings to stay depressed while sales continue to climb, eating up sitting inventory.  Prices must stay flat.  Incentives must be promoted, including the 15,000 tax incentive being pushed by Coldwell Banker at a national level in Washington and in the news. 

If your home is languishing with only a sign in the yard and no offers, call me to get your house sold!  If you're a first-time home buyer, now is a great time to kill the rent and get into a home at a great rate.

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 For Lancaster PA homes for sale click here. Jeff Geoghan is a top real estate expert in Lancaster County, PA, and an involved community member. Jeff's work has been featured in the Lancaster Newspapers, WGAL Channel 8, PA Business Journal and Wall Street Journal. Jeff's blog on Lancaster County and its homes is nationally-featured. Contact Jeff for more help with your Lancaster PA Real Estate needs. Jeff is also a photographer - view some of his lancaster pa photography portfolio. Comments are welcome!

 

This morning we had another great "Tweetup" (a meeting of Twitter fans) at Prince Street Cafe in Downtwown Lancaster City.  Interestingly, the group today was all-guy so nothing of consquence was discussed, of course.  Here's the official photo courtesy of Mike Miville of Miville Photography:

In attendance was @LancasterHomes, @therealizzy, @jonrom, @poservarial, @danielklotz, @maxtana, @mivillephoto, @wordcooper, @ryanshenhoover, @steveodonnel, @nhershey, @markstoner, @dbmoulton, @teamccloud and @brix11.

Thanks to all for coming out!  Next up - Star Trek Opening Night Tweetups tomorrow...looking forward to it.