Tips for buying a house in Youngstown, Ohio, in 2022

The local housing shortage has frustrated Mahoning Valley house hunters — especially first-time buyers — local real estate and mortgage experts told Mahoning Matters.

Housing supply reached record lows in 2021, the National Association of Realtors reported this month, and now home buyers are fighting their way through a highly competitive market — and likely paying much more than what they would have just two years ago. We took a look at local housing market trends and got tips and advice from our expert sources on how Valley home buyers can get ahead.

Matt Moore, branch manager for Amerifirst Home Mortgage in Poland, told Mahoning Matters that right now housing demand is greater than supply. It’s something that’s been a significant issue for the past two years., he said.

Moore said house values increased 12% in the last year, compared to a 5% increase over the last 10 years, according to a housing report on the Youngstown-Warren Metropolitan Statistical Area:

“In the entire Youngstown-Warren area, there’s only 2,300 houses for sale right now,” he said, citing the report. “In Mahoning County, it’s even more restrictive.”

Housing supply in the county has dwindled 18% in the last five years, Moore said. Now, there are only five homes for sale for every 1,000 people, a similar county report shows:

Home prices have risen nearly 30% since 2019, the National Association of Realtors reported. The median sale price of a home in mid-2019 was $285,300, and that increased to more than $362,000 by the end of 2021, according to association data.

Realtor Dennis Gonatas of Burgan Real Estate in Youngstown told Mahoning Matters people are willing to pay more than the house’s market value just to stay competitive.

“If you put an offer in for $210,000 and the house only [valued] for $205,000, they’ll still pay the $210,000 so they’re covering the gap in the appraisal,” he said.

Moore said the demand is fueled by the large millennial demographic coming into the market to buy a house. The average home buyer in the Valley is between 27 and 35 years old, according to the Mahoning County report.

Youngstown, which has a median income of $28,822, is the fifth-most affordable place to live in Ohio, according to a February report from SmartAsset, which used 2019 census data. East Liverpool, whose median income is $32,119, is the tenth-most affordable.

On average, Youngstown homeowners pay two-thirds less on their annual mortgage than the state average, and three-fifths less on property taxes, the data shows.

Jeffrey Rickerman, president of Mahoning Valley Real Estate Investors Association, said it’s not just the housing that is affordable, but it’s the very low cost of living that attracts people to the area.

“There were so many people working in the [steel] mills that there had to be housing for all those people. Then the steel mills shut down, and that was a big jolt to the economy,” he said. “Youngstown and the Mahoning Valley is really kind of thriving, and it’s very active now.”

But today’s lack of inventory is frustrating first-time home buyers, Gonatas said.

“Millennials are actually making offers on houses [without seeing them], as long as they like the pictures and I definitely don’t recommend doing that,” he said. “Millennials are looking for move-in ready, which is very hard [to find] in this market.”

Gonatas said buyers who put down competitive offers are still being overlooked by others who are able to put up cash or are willing to forego inspections or pay more than the appraised value.

Nearly 1 in 5 local home buyers are making cash offers on a home. Most of the time, that makes those buyers more attractive to sellers, compared to those who are working with a conventional loan.

“People are pulling [cash] from 401(k) accounts, other retirement equity in their house or they have other funds in the bank,” he said.

Before the COVID-19 pandemic, homes stayed up for sale for 20 to 30 days on average, Rickerman said. Now, they only last four to seven days on the market, he said. A good-looking property toured on a Wednesday afternoon could very well have a pending offer by the coming weekend, he said.

“A person must be really aggressive about looking and getting out there and looking right away,” Rickerman said.

Despite all that, the housing market is now in its slowest season of the year, Moore said.

He said he expects supply to pick up in the next few months, but it’s not going to be enough to meet the demand from the buyers, which will result in home prices continuing to increase.

“I do expect it to ease a little bit but not to the degree that it’s going to really change the dynamics of the market right now,” Moore said.

Here are some tips for home buyers to keep in mind when searching for a home throughout the Mahoning Valley:

Have a plan, get pre-approved, start saving

If you’re planning on buying a house now, it’s extremely important to have a plan and strategy in place, Moore said.

When home buyers dive into the housing market without being pre-approved for financing, or do not have a mortgage loan in place, it can make it difficult to put down a competitive offer on a home, Moore said.

“They might find [a home] they are interested in and they want to put an offer in and they won’t even have any idea of whether they could qualify for a loan,” he said. “Talk to a mortgage professional, figure out what you would qualify for. … They should plan off of that and also start saving money.”

Moore said down payments are a big barrier for first time home buyers.

“That’s the thing that really would hold young people back. Maybe coming right out of college, they got their first job. It’s a good paying job, but they don’t have any savings,” he said.

Rickerman said home buyers need to have a competitive down payment amount to be considered in the market — the average down payment is 20% of the home’s value — which requires saving money over time.

“[Loan officers] are gonna tell you how much of a house you can afford and also how much of a down payment you need,” he said. “Then you can start looking at neighborhoods, and you can get to know the neighborhoods around you or the neighborhoods that you’re interested in.”

He suggested first finding the right loan officer.

“Mortgage brokers or loan officers are going to want to see pay stubs, and that you have the ability to be able to pay that loan on a monthly basis,” Rickerman said. “The more attractive you look to a seller, the more likely they’re going to accept your offer.”

Get an inspection

Rickerman said prior to closing on a home, a home buyer should have a qualified home inspector inspect the house for structural damages, or issues with the electrical system or the roof.

“They’ll have the equipment to check everything and they’ll be able to give you a report and sit down with you and talk to you about what everything on the report means and make sure that you understand,” he said.

If a home is 50 years old to 100 years old, it most likely won’t be in perfect shape, Rickerman said.

“There’s probably still going to be some issues that the inspector is going to pick up and you need to understand those issues and make sure that you’re comfortable with them,” he said.

Home inspections typically take seven days, Gonatas said. If they identify any necessary repairs, buyers may be able to renegotiate their offer to compensate.

But now, home buyers are more often than not foregoing these inspections to speed up the transaction, he said.

“Your home typically is the most expensive purchase of your life, and it can also be the most expensive thing to fix,” Gonatas said. “Home inspections can oftentimes either guide you in making an educated decision as to what you want to repair or it’s so bad you just walk away.”

Work with a realtor

Finding a realtor who is experienced and has been around for a long time — someone who is “knowledgeable, aggressive and knows the players in the market” — is extremely critical for home buyers, especially first-timers, Rickerman said.

“You want a realtor [who’s] going to guide you through the process and look at the pros and cons of the houses you look at,” he said.

Rickerman said home buyers should first interview their realtors to make sure they’ll fit their needs….