Local housing prices surged 17% over past year, Fed speaker said

MICHAEL ROKNICK, The Herald, Sharon, Pa.The Herald

SHARON – When Russell Mills reported at the Shenango Valley Chamber of Commerce’s Economic Breakfast Wednesday that Mercer County’s housing prices surged 17% over the past year it startled many – including Mills.

“To be honest – I was surprised about this,’’ Mills said after giving his economic presentation at the Corinthian Banquet Center in Sharon.

As the regional executive of the Pittsburgh branch for the Federal Reserve Bank of Cleveland, Mills pulled together local and national economic trends.

“Obviously, this is about supply and demand,’’ Mills said of local housing prices after the event.

At first Tyler Johnson was skeptical of the spike. Then the broker/owner for local ERA Johnson Real Estate checked on prices of homes sold in the county over the past two years.

“You know what – it looks like he’s right,’’ Johnson said of Mills’ figure.

For decades local home value increases have trailed the national average – which this past year ran roughly around 4.5%. Local Realtors said in recent years there’s been a low stock of desirable houses in the area which have jacked up prices.

As an example, Johnson’s agency has a home listed in Hermitage with four bedrooms, one bathroom in a good neighborhood with a $275,000 asking price.

“Five years ago that house would have been going for $160,000 to $170,000,’’ he said.

But local housing costs are still a bargain compared to national figures.

The national average for a home sold in 2024 was $507,700, the website for the Federal Reserve Bank of St. Louis said. The Mercer County average was $197,000, Johnson said.

Still, there’s a shortage of local housing stock. Penn-Northwest Development Corp., Mercer County’s lead economic development agency, said it has been working to attract housing developers to the area.

In giving other local figures Mills told the audience that Mercer County mirrored much of the region as it lost 5.7% of its workforce since the pandemic.

“We live in an area with an older population,’’ he said.

With roughly 44,500 of the county’s residents employed, 21,000 have to travel out of the county to their job.

“That makes sense to me because you’re so close to other metropolitan areas like Pittsburgh and Akron,’’ Mills said after his presentation.

While he wouldn’t give a definitive response if the Federal Reserve would cut interest rates in the near term, the numbers speak for themselves.

The Federal Reserve has said it wants to see around a 2% inflation rate before it chops interest rates. On Wednesday the U.S. Labor Department said the consumer price index rose 3% in January from a year ago.