Thursday, November 5, 2009

Philadelphia and Surrounding Counties Market Statistics

Boat House Row in PhiladelphiaImage by reeltor99 via Flickr

As Congress discusses a 6 month Extension of the First Time Home buyer Tax Credit with an additional credit for repeat home buyers, the results of the initial credit seem to be obvious when we look at the Pending Sales Market statistics from September for Philadelphia and surrounding counties.

Pending Home Sales
Sept 2009 Sept 2008 % Change
Philadelphia 1287941 36.77%
Bucks 58241440.58%

With such substantial increases in the pending sales for all five counties, its obvious that our housing market has recovered substantially. Though its tough to know exactly how much the tax credit influenced this, logic tells us that it has had a substantial impact. When we add to this the decrease in inventory, we see what would be defined as a recovering real estate market.

Current Home Inventory Sept 2009 Sept 2008 % Change
Philadelphia 9,704
10,559 -8.10%
Bucks 4,0114,262-5.89%

So what does this mean for the next 6 months?
  • With a tax credit extension, motivation for first time home buyers will continue
  • A tax credit for repeat buyers will increase motivation for a new group of buyers
  • Shrinking inventory generally means competition between buyers for more desirable homes and possible upward pressure on prices.
  • Though the tax credits are significant, the 6 month window is still a limited window off opportunity.
  • The limited opportunity provides substantial additional motivation for buying even at a time of the year which is traditionally slower because of the retail market.
So though there is still uncertainty about the unemployment numbers, and we have not seen a great resurgence in consumer confidence yet, it does seem that in the house buying arena, there are substantial reasons for potential home buyers to get off the fence and take action now to benefit from the combination of affordable prices, low mortgage rates, and tax benefits that may not be extended again in the more active spring market.
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