Howard Hanna bullish about Central Pennsylvania market
Howard “Hoddy” Hanna III does not shy away from the fact that his company is aggressively looking to expand its midstate footprint.
With five offices and more than 120 agents in Cumberland and Dauphin counties, Pittsburgh-based Howard Hanna Real Estate Services has set its sights on Adams, Lancaster and York counties.
"We probably need 10 to 12 offices," said Hanna, the company's chairman and CEO.
The company, which is on pace for another record-breaking sales year in the midst of a slowly recovering housing market, plans to double its Central Pennsylvania locations, Hanna said.
"We would like to add two offices a year," he said. "(Acquisitions are) a focal point of our growth strategy."
Howard Hanna is reportedly in talks with real estate firms in Lancaster and Gettysburg.
The family-owned and -operated company finished 2011 with 34,292 closed transactions and a volume of nearly $5.8 billion.
Aided by a combination of pent-up consumer demand, historically low interest rates and a rise in rental rates, Howard Hanna posted back-to-back record sales months in May and June.
The company surpassed 4,000 sales for the first time in its 55-year history with 4,298 sales in June. That was a 19 percent increase over a record-breaking May. The firm's June closed sales volume was more than $815.7 million — up from $687 million in May.
Howard Hanna's year-to-date sales are up 23 percent compared with the halfway point of 2011. The company's closed sales volume was nearly $2.9 billion through June.
As a result of housing market growth, inventories have fallen and prices have been rising.
A June market report from the Central Penn Multi-List of the region's top 10 residential brokers saw a sales volume gain of 12.6 percent year over year. The average sales price increased to $175,697 compared with $174,253 in 2011.
"The real dilemma is how we can get new construction jumpstarted," Hanna said. "The Federal Reserve is urging lenders to lend, but regulators are saying, 'Be very cautious.'"
New home sales fell 8.4 percent in June to a seasonally adjusted annual rate of 350,000, the Commerce Department said last week.
An ongoing challenge could be mortgage financing, Hanna said.
"Although rates are low, processing and funding is going to be more difficult because of constraints put on by regulators," he said.
Howard Hanna officials have been meeting with developers, builders and lenders to assess market challenges.
The company noted significant activity in the condominium market in urban areas.
"We think that trend will continue," Hanna said, citing high volumes in the Ohio and Pittsburgh markets that the company dominates. "We see more urban living over a period of time."
Despite its fiscal problems, Harrisburg should not be discounted in that trend, he said.
Howard Hanna is the firm marketing the units available at the 1500 Project, a condo and retail building that is all but wrapped up at Sixth and Reily streets in Midtown Harrisburg.
A ribbon-cutting ceremony is expected to occur in the next few weeks. And all indications are that the 1500 will be sold out. The building is slated to be the neighbor of a future federal courthouse and could serve as a catalyst for additional residential and commercial projects.
"We like state capitals," Hanna said, also citing stable economics associated with college towns and other areas heavy on health care. "The state might have a lot of budget cuts going on, but it's still pretty stable."
Howard Hanna by the numbers
1957: Howard Hanna Real Estate Services was started by Howard Hanna Jr. with one office in the Oakland neighborhood of Pittsburgh.
4th: Howard Hanna is the fourth-largest real estate company in the United States, according to Colorado-based real estate consulting firm Real Trends, which ranks firms based on the number of closed transactions.
48: The number of Central Pa. agents in 2007.
121: The number of Central Pa. agents in 2012.
5: The number of Central Pa. offices in 2012.
134: The number of offices across Pennsylvania, Ohio, West Virginia and New York.
34,292: The number of closed 2011 transactions.
$5.8 billion: Total 2011 sales volume.
4,298: June 2012 closed transactions, the first time with more than 4,000 monthly sales in the company’s history.
$815.7 million: June 2012 closed sales volume, the highest sales month in the company’s history. May 2012 had been a record-breaking month, with $687 million.
$2.9 billion: Total 2012 sales volume through June.
Sources: Howard Hanna, Real Trends
Central Penn Multi-List residential Statistics 2008-12
2008: Listing count 7,529, average days on market 72, median sale price $165,000
2009: Listing count 7,557, average days on market 83, median sale price $161,900
2010: Listing count 6,667, average days on market 98, median sale price $163,900
2011: Listing count 6,354, average days on market 115, median sale price $155,000
2012 YTD: Listing count 3,880, average days on market 119, median sale price $158,000
Source: Howard Hanna Real Estate Services