Could the Philadelphia Real Estate Market be Recovering?

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As long as I have been in the real estate business, I have been told that real estate is an economic leader. We are first in and we are first out. A cliche that has been true in every recession I have experienced.

You'll remember that residential real estate was the first part of the economy to feel the changes from the boom to our current economic readjustment. Economic indicators were pointing to issues in the market just before we began experiencing the effects of those issues. The good news (for those of us who own homes or invest in real estate) is that we seem to be seeing some signs indicating that may be the next step in the process.

In a recent article in Realty Times, Kenneth R. Harney pointed out the following positive economic indicators;

Pending home sales took a 3.2 percent jump last month -- the second straight month of positive growth. These are signed home sale contracts that haven't yet gone to closing, but are scheduled to do so in the next 60 to 90 days.

Lawrence Yun, chief economist for the National Association of Realtors, said we're now at "the leading edge of first time buyers responding to very favorable affordability conditions, and an $8,000 tax credit."

Mortgage applications for future home purchases also surged again, up five percent nationwide last month, according to the Mortgage Bankers Association. Rates are firming up in response to the rising demand for mortgage money. They rose last week on average to 4.8 percent for 30 year fixed rate loans and 4.6 percent for 15 year mortgages.

In a market like Philadelphia, where our average prices have seen little readjustment from their historically affordable levels, these indicators may indeed herald the long awaited "bottom" of the residential real estate market. Fueled by basic human needs rather than rampant speculation, our market has remained stable, with only single digit price adjustments inthe past 2 years, and some makret areas actually seeing increases in price even in this environment.

So if you have been thinking of "making your move" in the real estate market, now may just be the moment you've been waiting for. As I have mentioned in earlier posts, buying real estate for a longer term financial benefit has always been a good thing to d, since time will ease any market adjustments in your favor. With these indicators, that logic is reinforced by the immediate benefots of the current market. So i f you have a reason to buy, and have been waiting for the right time, your wait may well be over.

Short Sales What the Heck are They?

In Philadelphia and New Jersey, there are more short sales then there were in the past, but we don;t have the problems faced in some other parts of the country. Even so, even real estate agents need specific training to help you with them, which is why I developed our short sale training course after returning from chairing the Short Sale Working Group last year for the National Association of REALTORS .

Because there is so much interest in , and confusion about Short Sales, I thought that this video might help consumers understand just what they are and how they work.

Buying a House in Philadelphia becomes a "No Brainer"

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In a recent article , talking bout the national real estate market (a real oxymoron since there is no "nationl" real estate market) the Realty Times staff quoted the National Association Realtors,

Buyer are still hesitating on whether to enter to market, but the National Association of Realtors estimates "the impact of the stimulus package and lower interest rates on the housing market to be about 900,000 additional home sales in 2009 compared to conditions before the stimulus package."

Though the stimulus package makes buying a home attractive everywhere in the country, in a market like ours, the impact for homebuyers is even greater than it may be in areas like Washington DC, Los Angeles, San Diego & Manhattan where the spike in prices was very high, and the price reductions over the past two years have been so large.

In a market like Philadelphia, the impact of the stimulus is even greater. A $250,000 property here can be a pretty nice property. And a buyer using an FHA mortgage with a 3% down payment, essentially recieves their down payment back from the stimulus package $8,000 tax credit. If thy ask the buyer for a 6% seller assist with their closing costs, they can purchase the home with little or no cash out of their pocket. In normal times a pretty good deal. In a market that has seen limited price reductions in the past 2 years (only an average of 3% from the highest point of the real estate boom) it becomes even more attractive. After all that price stability means that your long term financial benefits are pretty much "money in the bank" . Combine our moderate prices with low interest rates, and an attractive deal becomes even more of a no-brainer.

So if you can buy a home, now is the time to do it. If you can't buy a home, now is the time to find out what you need to do so that you will be able to do so soon. Good Luck and Hapy House Hunting.