The housing market in the Lehigh Valley continues to be a very strong Sellers Market. The median price for a house in December grew by 3.8% over December 2017 and the YTD increased by 7.6%. Days on the market decreased by 17.6% from 2017 to 2018 and the YTD change is -18.8%.
In the Lehigh Valley, unemployment rates have decreased over the past year and wages continued to improve. It is generally good for all parties involved in real estate transactions when wages grow, but the percentage of increase, on
average, has not kept pace with home price increases. This created an affordability
crux in the second half of 2018. Housing affordability will remain an important
storyline in 2019.
The Housing Affordability Index measures housing affordability for the region. For example, an index of 120 means the median household income is 120% of what is necessary to qualify for the median-priced home under prevailing interest rates. A higher number means greater affordability. This indes has decreased by 11.3% on a YTD basis. With limited inventory driving prices higher and interest rates increasing, Buyers are having a more difficult time finding properties that meet their needs and or budget.
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