From the Morning Call:
As the 2008 housing crisis eased, Easton Realtor Clay Mitman saw New Jersey residents looking to relocate to the Lehigh Valley become an ever-increasing segment of his clientele, up to about 50 percent today.
He’s likely to meet many more, if a fresh analysis of the recently signed federal tax cut by Moody’s Analytics proves correct.
The report, issued last week, found that provisions in the law will cut into the value of single-family homes — and nowhere will the pain be felt more deeply than in high-tax New Jersey, home to seven of the 10 hardest-hit counties nationally under the bill.
Federal write-offs for property taxes and mortgage interest are being capped or curbed, making home ownership even more costly in the Garden State, eroding the value of those properties.
As a result the Lehigh Valley could see more New Jersey homeowners crossing the Delaware River for lower state and local taxes in eastern Pennsylvania.
Analysts stop short of using the term “surge,” but do think more home buyers from the Garden State will be looking at the Valley.
If those buyers decide they can add a tolerable amount of time to their commutes, the Lehigh Valley “becomes a pretty attractive alternative,” said Moody’s Analytics senior economist Adam Kamins.
Interstate 78 points west as it runs through four of New Jersey’s hardest-hit counties in the Moody’s analysis: Essex, Union, Somerset and Hunterdon.
The monthly mortgage payments New Jersey homeowners have made over the years, transferred over to the Lehigh Valley, could make mortgage payments in the future much more bearable, Mitman said. “People with $100,000 or $200,000 in equity from New Jersey have a lot more buying power,” he said.
The last big wave of New Jersey residents into the Lehigh Valley, according to Sean LaSalle, with Berkshire Hathaway HomeServices Fox & Roach Realtors and licensed in both states, came during a 2003-07 housing boom. Cheaper property taxes in Pennsylvania and lower gasoline prices, lessening the cost of a longer commute, boosted home sales here.
“Then it really slowed off when we went into the housing recession,” said LaSalle, who said he splits his time equally between both states. “It picked up, but it’s not at the numbers it was back then.”