Home sales way up year over year (Pittsburgh, Washington: transplants, rental)

[okaydorothy]

I noticed that many homes we viewed in February are still for sale ; or relisted as a new listing. Some of course are gone, but those that need a little work are still there at the same prices. A few homes that were at the top of our budget (over 300,000) are still for sale. Those between 200-300 are gone.

[Tirade]

Originally Posted by BrianTH

This is actually starting to concern me--there are increasingly signs of significant undersupply, as noted in the article:

Having spent the last few weeks house hunting, I completely believe this. There were a few East End neighborhoods that I had interest living in, but the pickings are slim. Either there's no inventory at all, or the very few houses for sale have some sort of critical flaw that chase away most buyers.

[eccotecc]

I think some homes are selling by word of mouth. I recently visited Pittsburgh and while there mentioned to my 85 year old mother that I was looking at houses. She mentioned to me that a friend of hers from Greenfield is thinking of selling her home. I've concluded that elderly people are slow to move when selling their home even if they know it's the best thing to do. I would check zillow.com to see what homes are valued at on a street you are interested in and then make up fliers and pass them out. Get out and walk the neighborhoods in the evenings when people are on their porches and let people know of your desire to buy in their neighborhood.

Another source of referrals could be lawyers. They are always settling estates and usually their is a home involved. They may be a good source for finding a home. In the market Pittsburgh is now in, the more creative you are the better your chance of finding what you want at a desirable price point.

Think outside of the box.

[AaronPGH]

Personal anecdote – the units in my building (Glass Lofts) have finally started to sell rapidly. I think something like 6 people closed this past month?

[stburr91]

There is indeed a shortage in the most desirable locations, but I find it pretty hard to believe there is a shortage in the region.

Regardless, I think this is great news, now maybe we'll see people starting to look outside of the handful of hot areas.

[BrianTH]

Originally Posted by stburr91

There is indeed a shortage in the most desirable locations, but I find it pretty hard to believe there is a shortage in the region.

I don't think it is that hard to believe, once you recall that what we are talking about is homes actually offered for sale, and in approximately move-in condition (meaning at least close enough that you could move in with just a little work ahead of time). Undoubtedly there are many more places that potentially could be brought to market, but have not been for one reason or another.

now maybe we'll see people starting to look outside of the handful of hot areas.

Following along the lines of what I was just noting, I agree it will be a good thing as buyers expand their potential areas of interest, but you still need sellers in those areas as well.

[Tirade]

Originally Posted by stburr91

Regardless, I think this is great news, now maybe we'll see people starting to look outside of the handful of hot areas.

I have my doubts. The biggest reason why certain city neighborhoods are hot is because they're in walking distance of a vibrant business district, and there are very few alternatives outside of those neighborhoods for people who want that.

[stburr91]

Originally Posted by Tirade

I have my doubts. The biggest reason why certain city neighborhoods are hot is because they're in walking distance of a vibrant business district, and there are very few alternatives outside of those neighborhoods for people who want that.

I would agree that there is a limited number of vibrant business districts, but there are still a number of affordable, safe, and walkable neighborhoods with their own local business district. Then, there are the not so safe neighborhoods with local business districts. We just need the demand to start to push out, and "unlock" these neighborhoods.

I remember that as little 7-8 years ago, the Regent Square business district wasn't very vibrant. Things can change fast once demand picks up, and middle, upper middle class start buying in an area.

I believe that we as a region, would be much better off encouraging redevelopment of neighborhoods with "good bones", than we would be trying to stuff as many people as possible into a small number of desirable areas. I think there are quite a few neighborhoods that would need minimal redevelopment to become pretty desirable, especially for those that are being priced out of the most desirable areas.

[BrianTH]

Chris Briem breaks down the local supply/demand situation, with a focus on the City:

Nullspace: Revenge of the Insulbrick

Three key takeaways:

The current pace of new units may be inadequate to keep up with attrition, let alone increasing demand due to in-migration;

There is likely a gap between nominally habitable housing and the housing actually marketable to in-migrants; and

Historically low mortgage rates plus relatively good local credit conditions may be contributing to demand.

The good news is that a couple of those factors are at least potentially addressable, namely by getting more new-unit projects in the pipeline and also getting more investment in converting older properties to marketable properties. The bad news is that even that may not be enough to keep up with increasing demand, particularly since investment in new and rehabilitated units will itself fuel more potential demand as the gentrification zones in the core area expand.

[eccotecc]

Brian,

Everything you share is always so right on point, and your last post is no exception. Pittsburgh is definitely in a supply and demand crunch especially in the $200,000-$300,000 price range. What is probably going to happen within a year is prices will be in the $250,000-$350,000 range. It's econ 101, supply and demand. I noticed very strange market dynamics at play in the city. Good luck to young families searching for their first homes, and newcomers to the city who are not up to speed on wha'ts happening.