Wednesday, July 17, 2013

Philadelphia Marketwatch Report - June 2013

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Since my last Trend MWR post received a lot of hits, I thought it might be helpful to start posting it quarterly as it becomes available.

The MWR from Trend (or the MLS, as most people call it), focuses specifically on Greater Philadelphia. There are reports available for the entire 5 county area in Southeastern PA (and also in Berks County, so let's call it 6), as well as in Southern NJ and Northern DE.

The report for Q2 2013 is still trending upward (no pun intended), as was the Q1 2013 report I posted in May. The key metrics show that Philadelphia's average home prices are up, closed sales are up, supply is down, and marketing time is down.

Let's break these down 1-by-1, from a Realtor's perspective:

1. Average Sales Price: $208,087, up 4.5% from Q2 2012. Why do real estate prices go up? Simply put, supply and demand. If supply is low, then demand is high. That is what's happening here.

2. Closed Sales: 3,607, up 22.1% from Q2 2012. That's a significant jump, especially in a still-tight lending environment. It means that homes are selling in larger quantities, which makes it easier to sell; which translates into a seller's market. The pool of buyers is more qualified because lending guidelines haven't really changed yet (for the better), and people can still afford to buy; also good news for the housing market.

3. Homes for Sale & Months Supply: Down 16.1% and 28.9% respectively from Q2 2012. Again, if supply is low, then demand is high. If demand is high, prices go up. If prices go up, there is more competition. If there is more competition, there are more bids for each property. And so on, and so forth.

4. Average Property Marketing Period (aka Average PMP): 92 days, down 15.7% from Q2 2012. This means that it is taking the average seller less time to accept an offer on his/her home. When sellers have to wait a long time to sell, what typically happens? They lower the price to attract more buyers. When sellers don't have to wait as long to sell, what happens? Prices remain stable, and may even go up.

I'm sure that most of these were self-explanatory to the average reader, but sometimes it helps to break each one down and explain what it means.

If any of you readers out there would like the most recent MWR report for your specific area, please don't hesitate to reach out via phone/email/text. I can then email you the PDF.

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