by Phil Yacuboski
Northeast Pennsylvania is a hot real estate market for millennials, according to several national surveys that point to the area as a good place to buy a home.
“The rental prices are very strong right now and the rental prices are very high,” said Adam Davis, a real estate agent with Classic Properties. “Millennials are often heavily in debt when coming out of school, so sometimes that can be a challenge. They definitely are entering the market.”
Lending Tree, an online company that connects customers with lenders, recently listed the Scranton area as number seven on its national list of the places where millennials are flocking to buy a home. Buffalo, New York, Pittsburgh and Lansing, Michigan topped the list. Realtor.com listed the combined Scranton, Wilkes-Barre and Hazleton areas as number six on a similar list.
“You can get yourself into a pretty nice home for what you’re paying for rent,” said Davis, “and I think that’s attractive to a lot of buyers.”
Davis said in his experience, many millennials seem to be attracted to homes in Scranton because of the price.
“It’s affordability,” he said.
Sara Levy, a broker with Classic Properties in Clarks Summit, said because millennials are of a ‘broad age range,’ they are fueling the real estate market.
“I think millennials are definitely buying,” said Levy, who describes herself as on the ‘tail end’ of millennials at age 33.
“I think millennials start to do the math and many of them realize that they could buy for less than they could rent,” she said. “Many of them are thinking long-term and if they are going to stay in the area, it’s a good long-term investment, especially in Scranton because there’s a lot of opportunity.”
She said right now the real estate industry is facing an inventory shortage in several markets and Scranton has a lot of housing stock for potential buyers to choose.
“You get more bang for your buck in Scranton,” she said. “Because of the wage tax and a higher property tax, houses tend to sell a little lower than they do elsewhere in the region, typically in Lackawanna County. A first-time homebuyer in Scranton can get a really nice home that they couldn’t get anywhere else for an affordable price.”
Levy also said millennials are less driven by the attractiveness of a school district.
“The pre-marriage millennials are looking at building equity and then in a few years move on to a bigger home,” she said. “Even if they don’t have much equity built up, they have some and that’s better than nothing.”
While she too said a lot of millennials are saddled with student debt, some may not realize that there are many lending options.
“It’s all about connecting them with the right lender,” she said.
And while the Poconos are not on the list, Alex Camaerei, a realtor with Keller Williams Real Estate in Stroudsburg, said he’s seen a “healthy” number of millennials buying homes in Monroe County.
“I think there’s a lot of factors,” he said. “I think the number one reason is that we are close to the major metro areas of Philadelphia and New York, but we offer one thing they don’t and that’s affordability.”
He said millennials are typically priced out of those markets.
“We’re seeing all types of homes that are popular with millennials,” he said. “Bi-levels and ranch-style homes are both popular because you can get a nice house in the $130,000 to $160,000 range.”
Camaerei said while financing can sometimes be an obstacle, younger buyers can opt for an FHA loan and take advantage of first-time homebuyer programs where you can put down as little as three percent. USDA loans are income specific and allow for no money down as do loans for those who are veterans. Another program in Pennsylvania allows for borrowers to have closing costs paid for as part of the process.
Regardless of the study, those in the real estate business say the reports are promising in turning around a decades-old trend of people leaving northeastern Pennsylvania after getting an education.
“A lot of millennials are staying here,” said Davis. “That’s a great thing.”