The Philadelphia-area housing market is experiencing a decrease in home sales, but prices continue to rise due to a shortage of local inventory. According to Bright MLS, closed sales in the region fell to 5,815 in March, a 21.4% decline compared to the same period last year. However, the median home price increased by 5.5% to $324,995.
Limited Options for Buyers and Disincentivized Sellers Keep Home Prices High
Although the pace of price growth has slowed down, home prices in the Philadelphia area are still appreciating at a higher rate than in many other regions due to limited options for buyers and houses selling at a relatively fast pace. Inventory in the area is now at 40% of what it was in March 2019 and is less than a month’s supply in several counties. New listings have also declined by 25% to 7,273 homes in March, and have been lower than the previous year for 12 consecutive months. Bright MLS predicts that this low supply will continue as sellers are disincentivized from listing their properties due to economic uncertainty and locked-in interest rates.
March Sees a 21.4% Decline in Closed Sales but Spring Demand Improves Showing Activity
Homes in the market are staying for an average of 13 days, which is an increase of four days from the same period last year. Bright MLS reported that there were 174,151 total showings during March, which reflects a 26.6% decline from the previous year. However, showing activity has improved in each month of the first quarter, indicating an increase in demand for the busy spring season.
Some Counties Experience Less of a Drop-off in Sales while Chester County Remains Priciest in the Region
While home sales declined by over a fifth across the region last month, some counties saw less of a drop-off. Bucks County experienced a 7.5% decline with 482 closed home sales, Burlington County in New Jersey saw a 9.3% decline with 467 closed sales, and New Castle County in Delaware had a 27.9% decline with 428 home sales compared to March 2022.
Philadelphia County had the biggest decline with 1,225 closed sales, a 27.4% decrease. Montgomery County had a drop-off of 22.9%, while Delaware County saw a decline of 26.2%. Chester County, on the other hand, experienced a decline of 21.7% but remains the priciest in the region, with a median sales price of $476,000 in March, up 4.7%. Bucks County is next at $425,000, up 6.3%, while Philadelphia declined by 3.7% to $260,000.