Signs of a frozen housing market in Philadelphia and Delaware County
The head of Redfin's economics team said homebuyers “really should be thinking about negotiating” with sellers.
The ground and your toes aren’t the only things frozen in the Philadelphia region.
In the city and Delaware County last month, potential home sellers and buyers stayed on the sidelines, and sales were slow, according to a Redfin analysis of the 50 most-populous metropolitan areas for the four weeks ending Jan. 25. Pending home sales were down about 4% from the same time last year.
“You’re just not seeing a lot of activity happening,” said Chen Zhao, head of economics research at Redfin.
What has been heating up are prices. The market that Redfin defines as Philadelphia and Delaware County was in the top three areas where sale prices increased the most compared to the same time last year. The median sale price was up just over 10% to $294,125.
Limited home supply and rising home prices tend to go hand in hand, and that is what is happening in these markets, Zhao said.
Sales in January’s slow market happened at higher prices because buyers who are still in the market are willing to pay elevated prices.
The average number of new home listings ticked up slightly from last year, and it should continue to grow as the typically busy spring housing market approaches. So should the number of buyers looking for homes.
Any changes in affordability, Zhao said, will be “mostly driven by mortgage rates, not so much by prices.”
The average interest rate on a 30-year, fixed-rate mortgage was almost 7% at the end of January 2025, according to the government-backed mortgage buyer Freddie Mac. This year, it was 6.10% at the end of the month.
Zhao said she doesn’t expect mortgage rates to go much lower this year.
But buyers have more power than they think, especially now when sales are slow, Zhao said. They “really should be thinking about negotiating” with sellers.