If you've been considering selling your home in Philadelphia, then the spring market of 2023 could be a great time to do so. We are starting to see the Philly real estate market return to ‘normal.’ We are not seeing the frenzy of homes flying off the market in 24 hours with a dozen plus offers and crazy bidding wars. However, while the number of homes for sale is increasing and mitigating some of that frenzy, it is still significantly lower than before the COVID-19 pandemic. According to Realtor.com, there were 65.5% more homes for sale in January compared to the same time in 2022. However, home inventory in the U.S. is 43.2% lower than it was before the pandemic in 2017 to 2019. This means that we're still technically in a seller's market, it's just not as extreme as we saw during the pandemic.
A Look at the Numbers: Home Inventory
In the past six years, the number of active listings has fluctuated significantly. In 2019, there were 1,042,660 homes for sale, while in 2023, there were 625,875 homes for sale. Although this is an increase from the previous year, it's still significantly lower than in previous years. This means that there are still more buyers than there are available homes, which puts sellers in a favorable position. The increase in inventory combined with the continued buyer demand means that the Philadelphia housing market is currently in a sweet spot for sellers.
How Interest Rates are Impacting the Market
After experiencing a sudden increase in home mortgage interest rates in mid-2022, rates have since stabilized, fluctuating between 5.5% and 7%. More than the specific mortgage interest rate, homebuyers are likely to respond to the uncertainty of the market. During the period of rapid rate changes, buyers were hesitant to make decisions, unsure whether to act quickly or wait to see where rates and home prices would land. However, with both costs having been stable for six months by spring, many prospective buyers who have been waiting will likely be ready to re-enter the market.
In Philadelphia, although interest rates have gone up, buyer activity is picking up a lot and there are many opportunities for buyers and sellers to help each other out. For example, some sellers are willing to offer concessions such as buying down the mortgage interest rate, seller assist towards closing costs or repairs, etc.
The most significant factor influencing home prices during the spring market will be the number of homes available for purchase. Homeowners with low-interest mortgages may be hesitant to move since they would have to purchase a new home at a higher interest rate. Nevertheless, some properties will still enter the market, as individuals experience job relocations, family changes, and other life events. For example, empty nesters may sell their homes when they're ready to downsize.
Why This Spring Is a Good Time to Sell in Philadelphia
As a seller, you could take advantage of the current market conditions to sell your home quickly and at a good price. Despite some individuals being unable to afford the home they desire due to the higher interest rates, multiple bids could continue to be prevalent this spring. However, the number of bids is projected to be around three to five per house, rather than the 15 to 20 seen during the recent abnormal market conditions, resulting in a return to a typical spring market.
If you're considering selling your home this spring, it's important to work with a local Philadelphia expert who can help you navigate the market and make the most of the current conditions. They can help you price your home correctly, prepare it for showings, and market it to potential buyers. With the right approach, you could take advantage of the current housing market and sell your home for a great price.