The Philly Pretzel

Make no mistake we still are in a buyers market in Philadelphia and probably will be for some time. The housing market took a much needed correction after a number of years of unwise purchasing but unlike what the media would have us believe, a correction in the housing market doesn’t equate to a crash. Unfortunately, the ongoing negative news about the troubled areas in the U.S. has caused a ripple effect, with home buyers and sellers on a national level exercising caution before making a decision. This has caused an overall slowdown in the marketplace.

The National Association of Realtors says the US housing market showed signs of stability in February and existing home sales rose 2.8% nationally and up 11.3% in the Northeast, up for the first time in 7 months.

True, the numbers of homes sold in 2007 have dropped from the year before, but 2007 is still among the highest years on record, with numbers of sales for 2008 projected to be even higher than the levels seen in 2002. Inventory in the Philadelphia region still remains high but is moving in the right direction. This equates to good news for buyers who have more homes at more price ranges from which to choose.

Philly Median Home Prices:

        • The median sold price for 2006 was $180,503
        • The median sold price for 2007 was $185,204
        • This represents a 2.5 % increase in price (nationally there was a decrease of
           8.2%)

Philly Sales Volume of Houses Sold:

        • There were 17,667 homes sold in 2006 for a sold volume of $3,188,950,036
        • There were 15,735 homes sold in 2007 for a sold volume of $2,914,195,066
        • There were 1,932 fewer homes sold which equates to a decrease in sold volume
          of 8.6% (nationally 23.8%)

Summary:

        • Philly has faired much better than the national average both in median sold home
           prices and in volume of homes sold
        • Housing demand in the Philadelphia region is down from 2006 but still relatively
           strong
        • There is a smaller percentage of supply in Philly than there is in the majority of
           the country

Houses that are priced consistent with market guidelines are attractive to buyers 

        • Attractive listings increase Buyer demand
        • Increased demand reduces supply
        • Fact-based pricing creates a healthy real estate market

Potentially related website:
Search All Philadelphia Homes For Sale

Technorati: Philadelphia real estate, Philadelphia median home price, Philadelphia home sellers, Philadelphia home buyers

posted by janice

What are absorption rates… and why are they the best indicators of Market Performance?

Absorption rate is the average number of homes sold per month over a particular period of time and how long it will take the homes that are on the market to sell. Absorption rates are a great means of tracking market performance and predicting trends. Although they are usually used to indicate overall market performance they can be just as powerful when tracking sales by price range or by neighborhood.

Buyers market, sellers market or neutral market?

The amount of inventory determines which way the market swings. A neutral market is 6 months of inventory and anything less than that is a sellers market. Conversely, an inventory of more than 6 months is a buyers market.

What do absorption rates mean to a buyer?

Absorption rates can help a buyer to understand market supply and demand and this can be helpful when crafting his/her offering strategy. The longer a home has been on the market and the more competition that it has in its price range, suggests a lower offering strategy and a greater possibility of increased reduction off asking price.

What do absorption rates mean to a seller?

Absorption rates help a seller understand how long it might take a home to sell. They can also assist the seller in determining their pricing strategy. The most desirable home in a price range always sells first. If a seller wants to sell quicker, they want to have the most desirable home in a price range… even if that is one price range lower.

Disclaimer:

Absorption rates are a great tool that can be used by either a buyer or seller to understand the real estate market and to be in a better position for success. But they tend to fluctuate dramatically by neighborhood and by price range. Absorption rates are more accurate if calculated in smaller segments. A good example is the rate for Fishtown is 6.23 weeks and the rate in Queen Village-Pennsport is 4.33 weeks but the above rate for all of Philadelphia is 11 months! If you would like to know the absorption rate for your neighborhood, send me an email and I will publish the rate.

Potentially Related Posts:
The State of Philadelphia Real Estate
Philadelphia Forclosure Rate

Technorati: Philadelphia real estate, absorption rate, Philadelphia real estate trends, market conditions

posted by janice

Having trouble selling your Philadelphia “fixer-upper”? Think out of the box and try creative marketing. Make sure your sound is on when you watch this video.

Technorati: real estate humor, handyman special, fixer upper, short sale

posted by janice

 Sellers:  Pretend it’s not your house.

Let’s say your home is about to be shown for the first time, maybe for an open house. What should you do first?  Pretend you don’t live there.

Seriously, now. Walk thorough your home as if you’re seeing it for the first time.  Could someone trip over the coffee table? Are the kids’ toys underfoot?  How easy would it be to stumble over the TV cord that you’ve learned to avoid, or the stepdown you don’t notice anymore? Straighten up, no matter how tedious it might be. Have your Realtor warn potential buyers about stepdowns and low door frames. You’re looking for a sale, not a lawsuit.

Technorati: open house, ready to sell, home sellers

posted by carolyn