Cartoon: Home prices in Philadelphia are out of control

Looking to buy a home this spring? Good luck.

If you haven’t noticed, housing prices are out of control. Down the road from where I live in northern Delaware, new townhouses are being built that start from the low $400,000s. Yes, that’s $400,000 to continue to share walls with two neighbors while remaining an hour away from Center City.

Prices are up in Philadelphia and across the country, driven by record-low mortgage rates and a limited supply of homes for sale amid the pandemic. Homes that are available are going fast, often with multiple bids driving up the price even more.

Here’s how my colleague Michaelle Bond summed up the situation in a recent story about the current market for homes:

Although the housing market has been a bright spot in a pandemic-battered economy, the limited supply of homes for sale continues to hold back the market. The number of homes for sale nationally in February was down almost 50% — about 496,000 homes — from the same time last year, hitting a new low, according to Realtor.com.

In the metropolitan area that includes Philadelphia, Camden, and Wilmington, active listings were down 46% in February from the same time last year, according to Realtor.com. New listings were down 29%. In Montgomery County, the number of listings is the lowest Ostrowsky has seen in 15 years.

The aggressive market is forcing buyers to get creative and make major concessions, such as skipping a home inspections, plunking down large down payments or decking to ask sellers for help with closing costs. In one recent case, a seller “was offered and accepted dinner at a pizza restaurant one night a week for one year,” according to the News Journal.

Philadelphia has roughly three times the number of buyers for each home than in a balanced market, Bill Lublin, CEO of Century 21 Advantage Gold in Philadelphia, told the Inquirer. The Pennsylvania and South Jersey suburbs have about six times the buyers for each home. So think Hunger Games meets This Old House.

At this point, you’re odds are probably better hitting the Powerball than landing a winning bid on a house. Plus, you’ll probably need the cash to afford to buy it, anyway.

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