Should I Buy A Home in Philadelphia Now?

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Last week, Federal Reserve Chair Jerome Powell announced that not only would rates not increase, but they are expected to be cut three times in 2024. Once that happens, there will most likely be increased buyer competition and homes are likely to go way above asking price–especially since Philadelphia was recently identified as one of the top 10 national markets with the most pent-up housing demand, according to a National Association of Realtors study. And, it has twice as many affordable homes for first-time buyers as other comparable markets.

If you want to buy a home in Philly, it would be strategic to jump back into the market sooner than later and then consider refinancing later this year. After the competition increases (and home prices increase as well), you can never lower the price you paid for your home, but you can always refinance your loan to lower your monthly payment.

How to Reduce Property Taxes in Philadelphia

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Homestead Exemption Philadelphia

If you don’t have a residential tax abatement on the primary residence you own, the Homestead Exemption can reduce the taxable portion of your assessed value by $80,000. With this program, Philadelphians can save around $1120 on their annual tax bill, and once accepted, you don’t have to reapply each year. You will receive the benefit as long as you continue to own and live in the property.

Those with a current residential tax abatement are not eligible, but you can apply after the abatement is expired or removed. If you move out of your property to a new primary residence–keeping your former residence as an investment property, you have to remove the exemption from that property and reapply with your new primary residence.

Early tax filers should apply by September 13 while all others can apply by the end of December to see the exemption reflected on the next year’s tax bill.

Ready to save money on your tax bill?

Apply here

When is the Best Time to Buy a House in Philadelphia?

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A recent study from Attom Data Solutions showed that the best time for most home buyers to save (up to 7.4%) was in the winter months and buyers who closed on the day after Christmas realized the greatest below-market-value discounts of any other day of the year. Here’s why:

1. Less competition

Most buyers prefer to visit prospective homes in the warmer months of May, June, July, and August, which account for 40% of home sales. For the convenience of warmth—and the increased competition for available inventory—you may pay more than 7% higher for a home during these months.

While January and February make up less than 6% of sales, less competition may translate into more negotiating power for the Philly home buyer.

2. Motivated sellers

Sellers listing their homes in the winter often cannot wait until the warmer months when they can make a higher profit. For one reason or another, they need to sell now—empowering you with more leverage in your offer.

In addition, if a Philadelphia home is still lingering on the market from a summer listing, the seller may be more willing to accept a lower offer or give concessions, like assisting with closing costs.

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How to Prepare Your Philly Home for Winter

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Prepare your Philadelphia home for winter by maintaining the following:

1. Heating:
Replace the filter on forced hot-air systems, have a licensed HVAC technician service your furnace, and have a licensed chimney contractor ensure there is no blockage or creosote build-up from wood stoves or fireplaces.

Keep your heat above 55 degrees so water pipes within the walls don’t freeze, rotate ceiling fans clockwise to bring warm air down, and maintain pellet and wood-burning stoves per manufacturer’s instructions.

2. Roof & gutters:
Inspect your roof and coat it roof every five years to extend it’s life. Clear leaves and debris from gutters to ensure proper drainage and prevent ice dams or cycles that can fall, and ensure gutters direct water away from walking paths and the foundation.

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What are the Best First-time Home Buyer Tips?

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1. Save money
You’ll need to pay your down-payment (some loan programs offer as little as 3%), closing costs (3-5% of sale price), and escrow for insurance and taxes.

2. Improve your credit score
Make payments on time and don’t open new lines of credit or make major purchases—a higher credit score can equal a lower interest rate.

3. Get pre-approved
Shop around for the best loan deal and get it in writing (interest rate and any associated fees). You’ll need this letter when you make an offer. Local lenders often provide great, personalized service at competitive rates.

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What are the Best Tips for Selling Your Home?

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Selling your home in Philadelphia is a very different process from buying your first-home. As a seller, you’ll have more control in the process, but there are smart tips to follow to ensure a smooth process, a faster sale, and the best price.

1. Know the best time to sell your home in Philadelphia

Home supply and demand ratio determines if it’s a seller’s market, buyer’s market, or balanced market.

If you have the flexibility to choose when you sell, chose a seller’s market, which occurs when there are more buyers searching for homes than available inventory. In the greater Philadelphia area, this is typically during the warmer months—May through August—and can lead to multiple offers that can exceed the list price.

Like the national market, May is the best month of the year to sell your home in Philadelphia. Homes listed at this time sold faster and for up to 10% more than the yearly average, according to local sales data.

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Top Reasons to Buy a House in Philadelphia

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1. Enjoy tax write-offs

As a Philadelphia homeowner, you may deduct the interest you pay on your mortgage, your Philly property taxes, and some costs associated with buying a home.

2. Earn appreciation

Median single-family existing-home sale prices increased on average 5.2 percent each year from 1972 through 2014, according to the National Association of REALTORS®. Also, the number of U.S. households is expected to increase 10 to15 percent in the next 10 years, continuing the high demand for housing.

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