House hunters flock to the Poconos
Bob Dylan once sang, “The times they are a changin’.’”
And so are this area’s neighborhoods.
Despite the economic stress caused by the pandemic, there has been a recent real estate boom in northeastern Pennsylvania, especially throughout the Pocono Mountain region. Buyers, many from New York and New Jersey, are looking for homes and bringing bank vaults of money with them. Joe Trafka, a real estate agent from the DiMaria Realty in Albrightsville, said he’s had only three days off since June.
“We’re unbelievably busy,” said Trafka. “There are more buyers than there are agents and the agents are keeping waiting lists of potential buyers on their cellphones.”
Websites such as realtor.com and Zillow display pictures of “sale pending” houses that are outnumbering the active listings. On realtor.com, more than half of every page of houses in the Jim Thorpe area is marked pending or sold.
Kay John is a house hunter from Luzerne County and she has been looking for a home to buy in the Lake Harmony area for several weeks. She has run into a buzz saw of multiple offers already made on each place she has seen.
“I thought I was the first to see a place in Snow Ridge Village at 9 o’clock in the morning,” John said, “but there was already an offer made by someone who was shown the house late the night before.”
Another significant factor that is driving the real estate frenzy in the area is the historically low interest rates of around 3% on 15- and 30-year mortgage loans.
Realtors are saying that buyers are wasting their time if they want to offer under the asking price. In fact, offers over the listed price have become a common practice. Since agents are not allowed to disclose the amount of an offer, buyers have no idea how much to bid to get the house.
Dan DiMaria, co-owner of DiMaria Realty in Albrightsville, reported that there has not been such an upswing in housing sales since 9/11.
“Over 165 homes have been sold in Towamensing Trails this year,” said DiMaria.
Cindy Derolf of Pocono Area Realty Benz Group said, “Even if potential buyers say they’ll wave a home inspection in order to expedite the closing on the purchase of a home, they can lose out to someone who offers to pay cash to the seller that avoids time consuming mortgage loan approvals.”
A buyer needing a mortgage loan that requires an appraisal can be at another disadvantage. A cash buyer can waive an inspection and an appraisal to move the sale along much quicker.
Bidding on Pocono area houses has become incredibly high in some deals. One agent said an offer was made on a log home at $50,000 over the listing price, but another buyer wanted the house so badly, he offered $100,000 over the price to seal the deal.
Flipping houses has also become very lucrative. A house in Pocono Lake that sold as a fixer upper in 2014 for $30,000 was estimated at $139,000 this year and after extensive renovations, the property just sold for $239,900. Large profits are windfalls for sellers. A couple bought a two - bedroom town house near Jack Frost Ski Resort for $155,000 that had been purchased for $100,000 just two years ago.
Everything from $400,000 town houses in Lake Harmony to $90,000 chalets and A-frames nestled in wooded communities are selling minutes after they go on the market.
Fleeing the city
Buyers are coming from Philadelphia and from cities in New York and New Jersey. Even a required quarantine or a 72-hour negative COVID test for out-of-staters has not slowed down the frenetic rush to the mountains to buy real estate.
Realtors say there are several reasons for the surge in sales of both primary and second homes.
“Some are looking to escape the rising COVID numbers from where they live,” said DiMaria.”
In addition, now that many no longer have to travel to their places of employment, they can work from their home in the Poconos. We had one person from New York buy a house from a video we had online. He couldn’t get the time to see the home in person.”
A problem for renters
Long-term renters have become victims of the boom. Many are being pushed out at the ends of their leases by landlords who want to jump in on the action and get their piece of the profit pie. This phenomenon is causing a sudden homeless problem for area tenants.
Moreover, landlords have become more restrictive and added more conditions to their leases. Some are requiring that tenants pay for all utilities, plus trash removal, and snow plowing. One landlord in the Briar Crest Woods in Blakeslee has a provision that requires the tenant to pay for the pumping out of the property’s septic tank upon the termination of the lease.
Derolf explained that there’s also a great deal of stress placed upon the sellers. They have to sort through multiple offers that are on the table from a parade of potential buyers who have marched through their homes while they, the owners, have had to vacate the premises for hours and even entire days. Sellers might also discover that the buyer’s mortgage lender ordered an appraisal that was less than the asking price. In that case, the buyer has to make up the difference, which could negate the sales agreement.
The real estate business runs hot and cold, but right now it’s a raging inferno.
One thing is certain. The influx of hundreds of homebuyers will change the faces of the residential and part-time population throughout the entire Pocono region.