It's No Time To Sit On The Sidelines

A message from Tony Mete, President of the REALTORS Association of Metropolitan Pittsburgh.

When's the right time to make what will likely be the biggest single investment of your lifetime? I am talking, of course, about investing in a new home. If you've been sitting on the sidelines wondering what to do, here's the good news: In Metropolitan Pittsburgh, there is no better time to buy a home than 2008.
Pittsburgh's housing market has maintained a level of stability that much of the rest of the country can only envy. The national trends that have battered housing have left nary a scratch locally. In 2007, as double digit depreciation decimated new and existing home values elsewhere, the Metropolitan Pittsburgh Market more than held its own, experiencing just under 3 percent appreciation. The median sale price for single-family existing homes, in fact, increased 6.1 percent for the year.
What about all the scary news we've heard and read about the housing market? It simply doesn't apply here. According to the National Association of Realtors, real estate prices in Pittsburgh are behaving just as they should in a normal market. Homes here, as a matter of fact, are underpriced by national standards. As recently as the third quarter of 2007, the median existing single-family home price was $220,800 nationally, but in Pittsburgh that figure was $127,700. It's no wonder that homebuyers moving into Metropolitan Pittsburgh from other markets marvel at the value their money can buy.
The local housing market's resilience can be attributed to a healthy local economy, affordable prices and historically low interest rates. The fact that 4,400 payroll jobs were added to the local economy in the last 12 months also bodes well for the future. Good jobs stimulate housing markets.
It's also helpful to keep in mind that even the dire national news on housing has to be kept in perspective. The fact is 2007 was the fifth most active real estate year on record. Whatever the ups and downs of it and preceding years, homeowners who stayed the course over time almost certainly profited. Longer-term, the local housing story is an example of happy endings, with home prices in Pittsburgh having risen 62 percent over a 16-year period.
The extra bang-for-the-buck in this area's housing market has not gone unnoticed. In November 2007, Forbes magazine included Pittsburgh among its top 10 best performing housing markets. That followed on the heels of Forbes ranking Pittsburgh as one of the top 10 cities where one could live well and affordably. And Places Rated Almanac has twice named Pittsburgh "America's Most Livable City."
There is no great mystery in Pittsburgh's ability to earn such accolades. The plain fact is, housing here never sees the "high" highs that the more glamorous markets experience, so we never see the "low" lows, either. As a result, at a time when housing markets throughout much of the rest of the country are being tossed about by a perfect storm, the Pittsburgh market remains stable and on course.
Our area lending institutions also have contributed to stability. They have avoided "creative," often questionable lending programs. Instead, they stick with the tried and true, qualifying buyers sensibly, which leads to approvals of mortgages that buyers can comfortably manage. When the time comes, these buyers can sell their homes, having earned the equity that will enable them to make their next purchase. It's a lending system without the wild cards that created havoc in so many other markets, and it works to the benefit of all concerned—buyer, seller, lender.
What all of the underpinnings to the stable housing market mean, is that real estate remains the best investment that most of us will make in our lifetime. Here in Pittsburgh, this is an opportune moment to make such an investment. What we have now is a normal market, one where prices, availability and interest rates—which have hovered around 6 percent—make for a most attractive housing market. The housing options cover a spectrum of styles and choices. Whatever you want in a home, an excellent place to start looking is with a Realtor who can show you what's available to meet your needs.
Realtors, it should be said, can also be extremely helpful to those who are looking to sell their homes. Their understanding of the market, pricing, and even their knowledge of how to stage a home so it looks its best can be invaluable.
Those potential homebuyers who choose to "wait it out" may wish they hadn't. What little there has been in the way of a correction locally has already curtailed any possibility of over-building. Right now prices are stable, and incentives of various kinds are being offered by sellers as well as new home builders. Sooner or later a market recovery will kick-start another round of rising home prices and interest rates. A spokesperson for the NAR has even suggested that Pittsburgh could experience stronger-than-average price appreciation in 2008. While everyone is for an improving market, the really great buying opportunities would certainly diminish.
I've seen a great many changes during my 30-year career in real estate. We've gone from two-page agreements to 17-page agreements, and, with consumers, we've weathered all kinds of changes. But one thing that hasn't changed is the satisfaction to be found in realizing the American Dream by purchasing a home.
It's said that all real estate is local. You couldn't live in a better place, at a better time, to make the dream of owning a home come true.