1/26/2009
House foreclosures were up 127 percent in the commonwealth last
year compared to 2007, Austin J. Jaffe said this afternoon. Jaffe is an
economist for the Swatara Township-based Pennsylvania Association of Realtors (PAR) and chair of Penn
State University's
Smeal College of Business' Department of Insurance and Real Estate.
House sales also skidded 23 percent across the state and the
average house price dropped 2.2 percent from 2007 to 2008. The average price of
a house in Pennsylvania
last year was $195,500.
Pennsylvania
has yet to bottom out, Jaffe said. As foreclosures spread and more businesses
cut jobs, the situation is expected to get worse, he said. In December, the
commonwealth had the 32nd highest number of foreclosures in the U.S.
The state's real estate market could start rebounding by the
end of the year, but there will not be a rapid return to normalcy, Jaffe said. Foreclosures
have to decrease and income-to-debt ratios must improve to trigger a rebound,
he said.
The real estate market needs federal stimulus money, Jaffe
said. But figuring out how to use those dollars is tough, he added.
PAR wants Congress and President Barack Obama to erase a
rule attached to the $7,500 house credit that was included in the last stimulus
package, said Greg Herb, association president. Homeowners that received the
credit have to repay the $7,500. The federal government should not make
homeowners pay back the credit, and the credit should be extended through the
end of this year to help rejuvenate the market, Herb said.
