Philly-area housing market is slowing in line with seasonal trends, but not by much
Competition among home buyers is easing a bit as the housing market returns to a more normal fall season and buyers focus on the holidays. But the market remains hot.
Many families’ holiday celebrations are returning to something resembling normal for the first time since the pandemic started. The same goes for the housing market, which is still much hotter than normal for fall but is regaining some of the seasonality that usually defines it.
“Home buyers shopping this fall shouldn’t expect the same frenzied demand that triggered bidding wars on listings this spring and summer,” Jeff Tucker, senior economist at Zillow, said in a statement. “The normal seasonal slowdown of autumn has returned, when many families are busy with back-to-school activities and planning for the holidays.”
In the Philadelphia metropolitan area, listing prices are down, homes for sale are spending slightly more time on the market, and fewer homes are for sale, as usually happens in the fall and through the holiday season. Last year, the pandemic shifted a lot of the market activity planned for the spring and summer to the usually sleepier fall.
“In fall 2020, it was not a typical fall market,” said Danielle Hale, chief economist for Realtor.com. “So this year in 2021 we are seeing more of a typical fall market. But the market is still moving faster than we typically see this time of year.”
Buyer demand remains unseasonably high. The rest of this year will likely continue to see more slowing down of the market as buyers put off purchasing homes. The market usually picks up quickly after holidays end and the new year begins, Hale said.
The median listing price in the Philadelphia metro region — which includes the Camden and Wilmington areas and parts of Maryland — was $320,000 in October, down about 8% compared with the same time last year, according to Realtor.com.
In October, about one in five Philadelphia-area sellers cut their prices, according to Realtor.com. That doesn’t necessarily point to price weakness, Hale said. Sometimes sellers who are used to seeing booming price growth in the overall market get overexcited and need to adjust their listings to be more realistic.
Active listings in the metro area were down almost 2% in October from last year and down about 3% from September. The housing supply in the region has been relatively stable and is stronger here than nationally, Hale said.
The median number of days between listing and closed sale in October — 49 — was up one day from the same time last year and up two days from September, according to Realtor.com.
Across the Northeast region of the country, existing home sales — including single-family homes, townhouses, condominiums, and co-ops — fell 2.6% in October and 13.8% compared with October 2020, according to the National Association of Realtors.
The Northeast was the only region with a drop in sales from September to October this year. Existing home sales climbed in the South and Midwest — where affordability is drawing buyers — and stayed flat in the West. Sales in all regions were down compared with last year.
Nationwide, existing home sales rose by 0.8% from September to October. But sales last month were down 5.8% from a year ago.
However, the national median sales price of existing homes — $353,900 — increased by about 13% in October compared with the same time last year.
“Home sales remain resilient, despite low inventory and increasing affordability challenges,” Lawrence Yun, chief economist for the National Association of Realtors, said in a statement. “Inflationary pressures, such as fast-rising rents and increasing consumer prices, may have some prospective buyers seeking the protection of a fixed, consistent mortgage payment.”