Declining Home Sales and Limited Inventory: Greater Philadelphia Real Estate Market Insights

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DEVON, PA — According to the HomExpert Report by Berkshire Hathaway HomeServices Fox & Roach, REALTORS®, the Greater Philadelphia area has witnessed a decline in closed home sales and available properties across all 12 counties, compared to November 2022. Limited inventory has led to price growth, resulting in swift sales at above-average prices. Buyers with substantial down payments or cash transactions have remained active, driving market momentum. Pending sales have shown a slight increase throughout the Greater Philadelphia area, with expectations of further growth in 2024 as mortgage rates decline. Fox & Roach, REALTORS® CEO, Larry Flick V, emphasizes the persistent high demand, prompting buyers to act swiftly.

Housing Market in Philadelphia Region Slows

The Philadelphia region’s real estate market felt a chill in November 2023, as property sales across the 12-county area dropped by 9.7% compared to the same period last year. This is according to the November HomExpert Market Report© by Fox & Roach, which documented the sale of 5,093 homes in November 2023, a decrease from the 5,640 homes sold in November 2022.

In Pennsylvania, home to several of Fox & Roach’s market areas, the downturn was slightly less severe but still noteworthy. An average decline of 7.5% was observed in property sales, with 3,088 homes changing hands in November 2023 compared to 3,340 in the previous year. Notably, Bucks County bore the brunt of this slump, recording a dip of 15% in home sales. Montgomery County followed closely with a 9% decrease, while Philadelphia County saw a drop of 7.6%.

Across the Delaware River in New Jersey, Fox & Roach’s market areas also experienced a significant cooling off. The number of properties sold fell by an average of 14.5%, with 1,402 homes sold in November 2023, down from 1,639 in November 2022. Burlington County led the pack with a 15.3% decline in sales. Camden County followed with a 14.4% drop, while Gloucester County recorded a decrease of 14.2%.

Meanwhile, in Delaware, Fox & Roach’s market areas saw an overall reduction of 8% in property sales. A total of 597 properties were sold in November 2023, compared to 649 in November 2022. New Castle County witnessed a 9.1% decrease in property sales, while Kent County reported a more moderate decline of 5.1%.

The diminished sale numbers point to a broader cooling trend in the region’s housing market, as reported earlier. However, it remains to be seen whether this slowdown will persist into the new year or if it’s merely a temporary blip in an otherwise resilient market.

Declining Home Inventory in Greater Philadelphia

The Greater Philadelphia region’s real estate market witnessed a contraction in November 2023, with the number of available homes for sale falling by 8.9%. According to data, there were 18,704 homes on the market in November 2023, a noticeable decrease from the 20,535 listed for sale in the same month last year.

In Pennsylvania, where several of Fox & Roach’s market areas are located, the average inventory shrunk by 7.9%, with 12,496 homes listed for sale in November 2023, down from 13,573 in November 2022. Philadelphia County led this decline with a 10% drop, followed closely by Montgomery County with a 9.8% decrease. Bucks County and Delaware County also experienced a dip in inventory, with decreases of 7.3% and 1.2% respectively.

Over in New Jersey, Fox & Roach’s market areas saw even steeper declines in inventory. The average number of homes for sale dropped by 14.3%, with 4,249 properties listed in November 2023 compared to 4,960 in November 2022. Burlington County experienced the sharpest fall, a significant 21.2% drop, followed by Mercer County with a 15.8% decrease. Camden County also saw its inventory shrink by 9.3%.

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In the Delaware market areas served by Fox & Roach, the monthly average inventory fell by a modest 2.7%, from 988 homes in November 2022 to 962 in November 2023. New Castle County was particularly impacted, with a 6.7% reduction in available homes for sale.

This downward trend in home inventory across the region aligns with broader national patterns, as reported earlier. It remains to be seen how these dynamics will shape the Greater Philadelphia housing market in the coming months.

Faster Home Sales in Greater Philadelphia

Homes in the Greater Philadelphia region are spending less time on the market compared to last year, a trend that signals robust buyer demand in the area. On average, homes were listed for 27 days before being sold in November 2023, a 10% decrease from the 30-day average in November 2022.

In Pennsylvania, where several of Fox & Roach’s market areas are located, the average time on the market shortened by 8.1%. Homes were typically listed for 24.8 days in November 2023, compared to an average of 27 days in the same month the previous year. Chester County led the pack with a significant 25% reduction in average days on the market, while Montgomery County also saw a notable decrease of 14%.

In New Jersey, another stronghold for Fox & Roach, the average listing duration dropped by 14.3%. Homes were on the market for an average of 4,249 days in November 2023, down from 4,960 days in November 2022.

Over in Delaware, Fox & Roach’s market areas experienced a more modest decrease in average days on the market at 2.7%. Homes were listed for an average of 962 days in November 2023, slightly lower than the 988-day average in November 2022. New Castle County, in particular, saw a 6.7% reduction in listing duration.

These figures demonstrate a clear trend of homes selling faster across the region, suggesting a strong seller’s market. However, it remains to be seen how these dynamics will evolve in the coming months, especially given the seasonality of real estate sales and varying local market conditions.

Rising Home Prices in Greater Philadelphia

Homebuyers in the Greater Philadelphia region are paying more for properties, with the average sale price rising by 6.2% year-over-year in November 2023, according to data. The average home in the 12-county area was sold for $409,566 in November 2023, up from $385,565 in the same month a year earlier.

In Pennsylvania, one of Fox & Roach’s key markets, the increase was more moderate but still significant. The average sale price in November 2023 was $451,427, marking a 2.1% rise from $442,323 in November 2022. Chester County led this uptick with a robust 7.8% increase in average sale prices. Montgomery County followed with a 3.5% rise.

Across the state line in New Jersey, Fox & Roach’s market areas saw a dramatic surge in home prices. The average sale price in November 2023 was $365,646, a whopping 19.6% jump from the $305,741 average in November 2022. Mercer County led this steep ascent with a 27.6% rise in sale prices, while Camden County reported a healthy 17.1% increase.

In Delaware, Fox & Roach’s market areas also experienced an upward trend in sale prices. The average sale price rose by 6.5%, from $340,716 in November 2022 to $362,754 in November 2023. New Castle County stood out with a 7.4% increase in its average sale price.

These figures indicate a continued seller’s market across the Greater Philadelphia region, with home prices climbing amid strong buyer demand. However, it remains to be seen how long this trend will sustain given the uncertainties surrounding interest rates and the broader economy.

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Positive Growth in Greater Philadelphia Real Estate

Pending home sales in the Greater Philadelphia region are on an upward swing, reflecting sustained buyer interest in the area’s real estate market. In November 2023, a total of 5,042 homes were under contract, marking a 4.1% increase from the 4,844 homes under contract during the same month in 2022.

In Pennsylvania, Fox & Roach’s market areas experienced a 4.9% rise in properties under contract—from 2,850 in November 2022 to 2,989 in November 2023. Philadelphia County led this growth with a significant 14% uptick compared to the previous year. Chester County also saw a healthy increase of 6.7%.

Across the state line in New Jersey, Fox & Roach’s market areas also reported an increase in pending home sales, albeit at a more modest rate of 1.3%. A total of 1,435 properties were under contract in November 2023, up from 1,416 in the same month of 2022. Mercer County led the pack with a robust 12.4% increase, while Camden County followed with a 6.6% rise.

In Delaware, Fox & Roach’s market areas saw a 6.3% increase in properties under contract—from 571 in November 2022 to 607 in November 2023. New Castle County reported a 2.9% increase during this period.

These figures underscore the continuing strength of the housing market in the Greater Philadelphia region and suggest that home sales could remain robust in the months ahead. However, as always in real estate, local conditions vary and buyers and sellers should stay informed about trends in their specific areas.

Main Line:

The Main Line, the affluent suburban region west of Philadelphia, saw a slowdown in home sales in November 2023. The number of homes sold across its nine major townships dipped by 18.6% to 158, compared with 194 in the same month of 2022.

Despite the decline in transactions, home values continued to climb. The average sale price for a Main Line home was $836,529 in November 2023, reflecting a 12.9% increase from the previous year’s average of $741,196. This suggests that while fewer homes are changing hands, those that do sell are fetching higher prices.

The pipeline of future sales also contracted, with properties under contract falling 14.5% to 136 in November 2023, down from 159 a year earlier. This indicates that the pace of deal-making could slow further in the coming months.

The supply of homes for sale shrunk as well, with the monthly average inventory decreasing by 6% to 483 in November 2023, compared with 514 homes listed for sale in November 2022.

Homes that did sell, however, found buyers more quickly. The average time a property spent on the market shortened to 22 days in November 2023, an 8% decrease from the 24-day average a year earlier.

These figures point to a mixed picture for Main Line’s housing market. While fewer homes are being sold and listed, those that do come onto the market are being snapped up more quickly and at higher prices, suggesting robust demand among buyers.

Jersey Shore:

Atlantic County’s housing market showed signs of cooling in November 2023, with home sales dropping 16.3% to 277, down from 331 in the same month a year earlier.

Home prices also edged lower. The average sale price in the county slipped by 1% to $533,620 in November 2023 from $536,338 in November 2022.

The pipeline for future sales shrunk as well, with properties under contract falling 4.6% to 272 in November 2023 from 285 a year earlier.

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However, homes sold more quickly. The average time a property spent on the market decreased by 4.5% compared to November 2022.

Meanwhile, the monthly average inventory—a measure of how many homes are up for sale—ticked up slightly by 0.1%.

In Cape May County, the housing market also saw a slowdown. Home sales plunged 26.4% to 142 in November 2023 from 193 in November 2022.

Despite the drop in transaction volume, home prices rose. The average sale price in the county climbed 11% year-on-year in November 2023.

The number of homes under contract—a key indicator of future sales—declined 20.3% compared to November 2022. The monthly average inventory contracted as well, falling 4.3% from a year earlier.

These figures suggest that while the housing markets in both Atlantic and Cape May counties have cooled, the dynamics differ. In Atlantic County, prices are edging lower, while in Cape May County, they’re rising—indicating robust demand despite fewer sales.

Lehigh Valley:

The real estate market in Pennsylvania’s Lehigh Valley experienced a slowdown in home sales in November 2023, with the number of transactions dropping 13.9% to 470, compared with 546 in the same month the previous year.

Despite this decline in volume, home values continued to rise. The average sale price increased 9.7% to $362,020 in November 2023, up from $329,987 in November 2022. This suggests that although fewer homes are being sold, those on the market are fetching higher prices.

Inventory tightened significantly in the region, with the monthly average supply of homes for sale contracting by 30.1%. There were 1,322 homes listed for sale in November 2023, down substantially from 1,892 in November 2022.

Homes also took slightly longer to sell. The average time on the market rose by 16.7% to 21 days in November 2023, up from 18 days a year earlier.

The pipeline for future sales also contracted, albeit modestly. The number of properties under contract slipped by 2.7% to 476 in November 2023, down from 489 in November 2022.

These trends suggest a shifting dynamic in Lehigh Valley’s housing market, marked by less turnover but higher prices—a signal of continuing strong demand amid tighter supply. However, the longer time on market indicates buyers may be taking more time to make decisions, a trend worth watching for sellers and real estate professionals alike.

Please note that the Greater Philadelphia region comprises counties in Southeastern Pennsylvania, Southern New Jersey, and Delaware. These counties include Philadelphia, Bucks, Chester, Delaware, Montgomery, Burlington, Camden, Gloucester, Mercer, Salem, Kent, and New Castle. The Main Line data specifically covers Malvern Borough, Tredyffrin Township, Willistown Township, Easttown Township, Haverford, Newtown, Radnor, Narberth, and Lower Merion. Center City data encompasses zip codes 19102, 19103 (Rittenhouse Square), 19106 (Old City), 19107 (Washington Square), 19123 (Northern Liberties/Fishtown), and 19130 (Fairmount/Art Museum). The Lehigh Valley region includes both Lehigh and Northampton Counties. If you require additional charts and graphs, please let us know. The top municipalities listed represent those with 20 or more sales. Days on Market (DOM) data indicates the number of days a property remains listed from the initial listing date in the multiple listing service (MLS) until it goes under contract.

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