Are you contemplating a move to Philadelphia? Or are you planning to sell your current home so you can move up to a more spacious house in the same area? No matter which situation you’re in — now is a great time to look at Philadelphia houses for sale for various reasons. Here’s how to know if it’s a good time for you to shop for homes and why it may be the perfect time to buy.
Consider your unique situation
Now is not necessarily the time to buy for every prospective homeowner, but it could be the ideal time for you. You need to think about your own unique situation and see if it makes sense to make a move. Here are some things to take into account:
- Do you have a home to sell? If you have to buy and sell at the same time, you may face some additional challenges. However, you can usually navigate this situation with some preplanning and the help of an experienced realtor.
- Are you in a solid financial position? Do you have enough money for a down payment, closing costs, and other expenses involved in moving? If not, you will probably want to hold off until you’re more secure.
- What are your plans? Are you interested in Philadelphia homes for the short-term, or do you intend to live in Philly long-term? Most real estate experts recommend you only buy a home if you expect to live in it for five years or more.
If you decide that it’s the right time to buy for your family, you will benefit from some favorable aspects of the market.
More inventory leads to more choices
Like many other cities around the nation, Philadelphia has become a hot seller’s market due to record-low mortgage interest rates and the new flexibility many have been experiencing in the new work-from-home culture. This market has been made even more competitive by potential sellers who are reluctant to list due to financial insecurity or fear of what the future may hold. This has led to a drop of nearly 50% in inventory compared to one year ago, and numerous buyers are struggling to find a home that fits their needs. However, the tide is starting to turn. Real estate professionals are beginning to see more homes hitting the market, though it will likely be quite some time before the supply catches up with the demand. However, more inventory still leads to more choices for the motivated buyer ready to make a quick offer once they find a home they like.
Prices will continue to increase
Prices of single-family Philadelphia houses for sale jumped more than $40,000 from where they were one year ago. Experts predict that 2021 will see prices increasing as high demand and low interest rates continue. That means that the longer you hold off on buying Philadelphia homes, the more you will pay when you eventually do buy. Unless your situation allows you to wait to buy a home until the market returns to a more balanced market — which could potentially take years — now is the time to start looking at Philadelphia homes.
Mortgage interest rates are still low
Though many experts in the real estate industry predicted that mortgage interest rates would increase in 2021, the reality is that they are still at near-record lows. A 30-year fixed-rate conventional loan sits at 2.819% as of April 2021, and a 15-year fixed-rate mortgage can be secured for as low as 2.107%. These low rates mean you can either afford to spend more on a home or save money on your monthly payments. For example, if you purchase a home that costs $500,000 at the current 30-year rate, you would save almost $300 a month compared to what you would pay if rates go up by just one percentage point. If you are in a position to buy, do so now before interest mortgage rates rise.
Tips on buying Philadelphia homes in a competitive market
Making an offer on a home in a competitive market is different than a more balanced market or one that favors buyers. Here are some tips that will help you out:
- Get preapproved. Sellers in a competitive market typically won’t even entertain offers from prospective buyers who are not preapproved for a loan. Get preapproved before you even begin searching for a new home to prove to the seller you’re serious and to get an idea of how much you can spend.
- Act quickly. Homes in competitive markets can sell just days or even hours after being listed. If you take a weekend (or even an evening) to think about making an offer, you might lose out to a more motivated buyer. Make sure you’re in a position to make an offer on the spot when you find the home that fits your needs.
- Don’t lowball. Philadelphia homes sell at 100% of their listing price in this market, and many in-demand properties will sell for over what they are listed for. Any offers below the list price will likely be rejected.
- Submit a clean offer. In a buyers’ market, you can usually get away with asking for favors or putting in contingencies regarding financing, inspections, or repairs. That’s not true in a sellers’ market. When you make a clean offer, you give yourself the best chance of securing the house you want.
- Utilize Compass Services. When you’re in between homes, a short-term bridge loan, like those offered by Compass Bridge Loan Services, can use the equity from your current property to help boost the offer on a home you love. A bridge loan often helps you buy when the time is right without the added pressure of selling your current property in a time crunch. When you’re ready to put your home on the market, Compass Concierge offers a hassle-free way to prepare your home for sale in order to help you sell your property faster and for more.
If you’re currently in a position to buy Philadelphia houses for sale, it’s the ideal time to do so for many reasons. If you’re ready to start your search, reach out to a knowledgeable Philadelphia real estate agent like Marc Silver, who can help you navigate the competitive market and who will be by your side during the entire process.