What Is Driving Our Current Market

You have likely heard about the shortage of homes for sale in Lancaster County. Last week there were 372 homes for sale in all of Lancaster County. For perspective – 12 years ago at the bottom of the market there were over 3,300 homes for sale in the county. To get there, prices dropped approximately 15% to 18% over a 6-year period before bottoming out in 2013. Since 2013 prices have been moving up and inventory has been declining.

We were experiencing sellers’ market prior to COVID-19. The pandemic has exacerbated inventory shortages and accelerated price increases. The median home price in Lancaster County now stands at $219,000 which is a 47% increase from the bottom just 8 years ago. Our expectation is prices will increase another 6% to 9% in 2021.



  • A robust economy
  • Lancaster County population increased approximately 1% per year while housing starts declined 75%.
  • Household formation numbers increased after declining during the recession.
  • Low interest rates
  • New construction continued to lag demand due to the development costs.

Since the Pandemic Started in March 2020

  • Even lower interest rates
  • 2nd home buyers from more densely populated areas.
  • Relocation buyers from more densely populated areas.
  • Approximately 20% to 25% of home sellers who want to sell but will not sell during a pandemic.
  • Seniors who had planned to move to retirement communities but have delayed or cancelled those plans.
  • Frustrated buyers who now have decided to stay in their home and remodel.

The last 3 points remove significant housing inventory from our market. Our expectation is that the inventory shortage will not begin to ease until we are well through the Pandemic. It may take 2 to 3 years to return to a balanced market. We have included a simple graphic to illustrate this point.

This is a broad strokes overview and hopefully has been helpful to you. If you want to discuss buying, selling, or market conditions, please give us a call!


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