Although real estate sales in Western PA were down slightly in the first quarter, we project that the residential real estate market will be significantly better for the remainder of 2016.
Pittsburgh, PA (PRWEB) April 19, 2016
Although real estate sales in Western PA were down slightly in the first quarter of this year compared to last year (units were down 2%, sales volume was down 1%), Northwood Realty Services projects that the residential real estate market will be significantly better for the remainder of 2016.
“We believe the slight downturn was primarily caused by the drastic reductions in the oil and gas industry, along with cold weather. As the year progresses however, we will see mortgage rates continue to stay low since the Federal Reserve has indicated it is going to be slow raising the discount rate,” said Tom Hosack, president and CEO of Northwood Realty Services.
Hosack estimates two rate increases by the Federal Reserve this year of .25% each, most likely coming in June and late fall. He went on to note that slight rate increases often motivate people to buy more quickly, as they don’t want to lose an opportunity for a good rate.
“Unemployment continues to remain low, and underemployment – those who had decided not to work or try to find a job – is finally starting to drop,” said Hosack. “These factors indicate that we should see positive wage growth, which is a huge component of real estate sales. Combining higher wages with a reduction in gas prices means people have more income to spend on housing.”
Home prices in the market continue to remain stable and are very affordable, based on ratio of price to local income. Hosack explained that higher priced homes saw a decline in sales during the first quarter of 2016, likely tied to the drop in the stock market. Upper-end buyers are typically more invested in the stock market than lower price point buyers.
“With the stock market back to its previous levels, we believe there will be some pent up demand in the luxury home market in the second quarter. We project that the region’s home sales will be up about 5% over last year in this second quarter and should end the year up about 8%, which will be a very solid year for the region,” said Hosack.
About Northwood Realty Services
Founded in 1956 and celebrating 60 years of service, Northwood Realty Services is one the region’s largest real estate services providers, serving customers across 22 counties from 37 offices in Western Pennsylvania and Eastern Ohio. Northwood and its affiliates provide clients with full-service real estate solutions that cover every step of the home buying and selling process. Northwood consistently leads the industry by employing new technologies, best-in-class training and experienced leadership to ensure that its agents are positioned to assist buyers and sellers with unparalleled customer service. Northwood has earned a reputation for integrity, accountability and hard work. Guided by these principles and a desire to serve others, Northwood agents are changing the face of real estate.
For more information about Northwood Realty Services visit: http://www.northwood.com/