Sunday, November 07, 2004

Is housing boom slowing?

Is housing boom slowing?
The Intelligencer

The local real estate market remained hot in the third quarter, with sales and prices rising compared to the same period last year.

But the number of days it took homes to sell was also up, one possible sign of the cool-down several local real estate agents say they've seen since the quarter ended Sept. 30.

"I think sales started slowing down in September, and have continued slowing down since," said Dave Curry, an agent with ReMax Action Realty in Horsham.

In central and upper Bucks County in the third quarter, home sales were up 3.6 percent, to 1,168, over a year ago, and the average home price was up 10.6 percent, to about $335,000, according to data provided by TReND Multiple Listing Service. In eastern Montgomery County, sales were up 6 percent, to 850, and the average price rose 15 percent, to about $271,600.

Those numbers match countywide data and national home sales figures.

At the same time, the average number of days homes sat on the market in the third quarter also increased over a year ago, to 44 days in central and upper Bucks, from 34 last year. In eastern Montgomery County, the increase was less, about two days, to 29.

"That's been our experience here, too," said Robert Alderfer, broker at Robert C. Alderfer Real Estate in Souderton. "The market is still very strong," but, "houses are taking a few additional days now to sell."

Alderfer thinks election wariness has slowed sales since the end of September.

"There's definitely a little more weakness than there was earlier this year," he said.

Now that the election's over, Alderfer expects the market to return to normal.

"If employment doesn't get any worse in our area ... I would expect it to be about the same for the next quarter," he said.

Barbara Moyer, an appraiser with Barbara K. Moyer Real Estate in Quakertown, also has seen a market slowdown in recent weeks, but blames prices.

"I am continually shocked at the higher and higher prices," Moyer said.

Those high prices are prompting people to shop a little longer before buying, she said. Moyer said the recent slowdown hasn't been dramatic.

"I think some people are going to wait until prices come down a little bit," she said.

Curry did use the term "dramatic" to describe the recent slowdown, but he said he's mostly talking about the high end of the market - homes selling for $500,000 or above.

In the average home price range of $300,000 to $350,000, he's seeing no deceleration at all.

"I still think it's a pretty hot product," Curry said.

Going forward, most in the industry think continued demand for housing in the area will keep sales brisk, and prices rising. But they don't think prices can continue rising as fast as they have in recent years without slowing sales.

Said Curry: "I personally feel that the spring will be just as strong (as last spring). ... I don't think prices will keep escalating at the rate they were."


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