About a year ago, Jeff Tragone and his wife began looking into the housing market in Yardley, Pa. The couple had hoped to upgrade from their townhouse to a single-family home nearby, replete with a garage and plenty of backyard space for their newborn son to roam around in as he grows up. The other catalyst for their search was the record-low mortgage rates that have upended the market, alluring a swell of homebuyers to purchase in suburbs like Bucks County.
“We were very picky because we wanted to be somewhere we could see ourselves forever. We didn’t want to settle,” says Tragone, who works in pharmaceuticals, while his wife teaches kindergarten. “Originally, we wanted to find a turn-key style home, but unfortunately those are going for way over asking price. A lot of people can play that game, but we just couldn’t.”
According to Long & Foster’s Bucks County market analysis from March 2021, median sales prices have surged to $380,00, a 12% increase compared to the median price last year of $338,500. Meanwhile, active inventory has plummeted by over 60%. In April, homes were on the market in Bucks County for only 16 days on average, as opposed to 26 days this time last year, according to Redfin housing trends.
Consequently, low inventory and skyrocketing prices have caused competitive bidding wars, forcing some homebuyers to compromise or renege on their original plans. Homes in the $300–$400,000 range have been flying off the market in the course of one day, says Sarah Peters, realtor for Keller Williams based in Doylestown.
Low inventory and skyrocketing prices have caused competitive bidding wars, forcing some homebuyers to compromise or renege on their original plans.
“Properties are getting twenty offers. People are doing things that are kind of crazy in this market. Some people have been waiving inspections, the appraisal, or the mortgage contingency, all in attempts at getting the house quicker.”
Peters says neighborhoods that have never previously reached the $1 million threshold on homes are now surpassing that mark. Last month, for instance, she sold a home for more than $200,000 over the asking price. She credits the work-from-home flexibility and urban residents’ yearning to leave crowded cities like New York or Philadelphia as additional reasons for the high-demand.
According to recent Zillow survey results, ruthless buyer-demand and rising home prices will continue to persist for the next few years in the post-pandemic era. Inventory, however, will only slowly increase, eventually easing some strain in buyers’ competition.
Shortages in building supplies also play a role in the tight market. Cory Benhardt, a rookie agent at Keller Williams, says the soaring cost of lumber has forced long construction delays for many of his clients. “Windows, siding, and framing seem to be the three major things that are holding up the new home demand.” One of his clients, he says, is looking at a year-long moving delay because of build out requirements.
“Seasoned agents have told me that if a realtor can make it through a market like this, they can make it through everything,” says Benhardt. “It’s competitive, quick, and you have to be on your toes. You have to inform your buyers exactly what they can expect from the market and go full force.”
After a year of endless bidding and crafting hand-written letters to convince sellers to choose their offer, Tragone and his wife were still coming up empty-handed. Finally, however, thanks to the guidance and transparency from their Remax realtor team of Mary Brandt and Vince Cacciatore, Tragone and his wife landed a home that had great bones but needed some additional renovations.
“We had all the flooring ripped up and added hardwood floors on the first floor. We had to drywall the entire family room from ceiling to floor, put in new appliances, and install recess lighting, too. After those endless nights of work and painting, it’s so worth it. We spent nothing close to what others are paying around us, and we have the home exactly how we want it.”
Tragone advises prospective homebuyers to lean on their real estate agent and loan officer to give feedback and answer questions. “You’re not in it alone; be patient, and the right house will come. We’ve never been happier than in the home we have now. It takes time. We lucked out.”
Ezra Solway is a Philadelphia native and freelance reporter. You can follow his writings on Twitter at @SolwayEzra