by Phil Yacuboski
As we head into 2018, real estate agents are looking for the stability of the market to continue.
“Everything has stayed pretty good in this area,” according to Adam Davis, a realtor with Classic Properties in Scranton and served as president of the Greater Scranton Board of Realtors in 2017. “Our prices are stable and if you have a good product, it’s definitely selling.”
Davis said in the Scranton area, there’s a shortage of housing listings.
“People are jumping because there’s not much out there,” he said. “I think we are really on the up and up.”
Realtor.com lists the Scranton/Wilkes-Barre/Hazleton market as ‘slightly cool’ in its November 2017 list of hottest markets around the country. It ranked 218 on the list. The hottest markets in Pennsylvania surround Philadelphia and Pittsburgh.
Davis said he believes there’s a housing shortage in some areas, because people are not moving.
“That’s great because we want to keep them here, but this has really been the trend for the past year,” he said.
Davis said property is tough to come by in the Abingtons and Clarks Summit. He said the price range between $250,000 and $350,000 is almost ‘nonexistent.’
“And if they do come up, they are gone within days,” he said.
Scranton, on the other hand, he said, is ‘always a little bit slower.’ Davis also said rent has been rising, therefore it’s cheaper to buy a home.
“We’ve had continued recovery in Pennsylvania,” said Kathy McQuilkin, president the Pennsylvania Realtors Association, a statewide group that tracks real estate trends. “We haven’t seen huge incremental increases, but it’s been steady and brought us back to where we were at the end of 2007.”
In 2017, Scranton cut its realty transfer tax from 2.9 percent to 2.4 percent. For those buyer or seller on a home, it means a $250 savings on a home priced at $100,000.
“Anytime you reduce the transfer tax, that’s a positive,” she said. She said Pennsylvania’s transfer taxes are typically some of the highest in the nation.
The 2018 real estate market might largely depend on the tax bill passed by Congress.
“Our biggest concern has been the state and local tax deduction,” said McQuilkin. “Pennsylvania is a high property and income tax state.”
The legislation allows filers to claim a deduction of up to $10,000 – meaning a combination of state and local income and sales taxes as well as property taxes.
“We think that’s a negative for us,” said McQuilkin, “and that could still create a tax increase for a good number of homeowners.”
She thinks there is a possibility that home values may decrease if homeowners are carrying a lot of debt, given the deductions allowed under law.
McQuilkin said Pennsylvania’s home ownership rate is lower than in years past, something else that also might be affected by the new tax bill. According to numbers collected by the U.S. Census Bureau, the number is just below 70 percent; in 1999, it was 75.2 percent.
“Millennials are also at a low rate of home ownership,” she said, adding that with many of them carrying a lot of student loan debt, it’s often difficult to come up with down payment. Pennsylvania has the second highest student loan debt, according to information complied by the Census Bureau and the Bureau of Labor Statistics. “That has a big concern to us.”