A red-hot housing market can be attributed to pent-up demand from people who’ve been pent up.
Homes in Allegheny, Armstrong, Butler and Westmoreland counties sold for a combined $135.5 million in May — up 13% from May 2019 — and the 551 homes sold last month represented a 10% increase from a year ago, according to West Penn Multi-List.
That’s even more impressive considering real estate businesses in most Western Pennsylvania counties didn’t fully reopen until the second half of last month because of coronavirus-related restrictions.
“It’s the hottest market I have ever seen,” said Tom Hosack, president and CEO of the McCandless-based Berkshire Hathaway HomeServices and president of West Penn Multi-List.
Pennsylvania was one of only a handful of states in the country where real estate services were deemed nonessential. Real estate companies closed their doors and could not hold open houses under restrictions enacted by Gov. Tom Wolf. Some conducted business virtually, but that had its limitations, agents said.
When restrictions began loosening, agents, buyers and sellers hit the ground running.
On May 15, when most counties in the southwestern part of the state moved to the yellow phase of Wolf’s reopening plan, Freeport-based real estate agent Heidi Powell held 10 showings of a $238,000 Buffalo Township home. The seller received an offer they couldn’t refuse within hours. A dozen showings scheduled for the following day were canceled.
“We’ve had other properties sell within hours with multiple offers,” said Powell, who owns NextHome Dynamic Realty in Freeport.
In North Huntingdon, Coldwell Banker agent Cathy Bittner listed a home at 10 a.m. on a Wednesday. In two days, she had booked 16 showings and received nine offers.
“It’s very busy, very crazy with multiple offers if a house is priced correctly,” said Bittner, a Realtor for 27 years.
Howard W. “Hoddy” Hanna III, chairman of Howard Hanna Real Estate Services in Pittsburgh, added: “It’s the best real estate market for activity and demand in my whole history in the business.”
Several factors are contributing to that.
Record low mortgage rates have enticed buyers. After showing signs that they might begin going back up, the average rates for a 30-year fixed mortgage hit a record 2.97% on Thursday, Mortgage News Daily reported.
While unemployment rates have soared, many people who kept their jobs, especially ones who could work from home, spent less money and built savings during the pandemic. Stimulus checks of at least $1,200 also helped, said Kurt Rankin, a PNC economist.
The personal savings rate spiked from 8% in February to 33% in April, Rankin said.
That helped “push people over the line to get a mortgage,” Rankin said.
For sellers, stay-at-home orders created the perfect opportunity to paint, clean and spruce up properties in order to sell them, Hosack said.
The residential market also is picking up where it left off before the pandemic, with an inventory shortage, and that is good for sellers because it can help drive up demand, agents said.
“If a home is under $400,000, it’s a great time to sell a house,” said John Petrack, executive vice president of the Realtors Association of Pittsburgh.
The conditions have made it tough for some would-be buyers.
“We had a house we were looking at, and it was gone before we could (take a tour),” said Amanda Good, 36, of Freeport, who with her husband and three boys is renting at a Freeport parsonage because their house sold shortly before the pandemic.
