Rising mortgage rates and higher home prices are impacting demand in the housing market, with sales down 15.4% compared to last August in the Philadelphia Metro Area that includes seven New Jersey counties, a Bright MLS report released Monday says.
The report, which includes data as of Sept. 7, also shows homes sales are down 11.9% since the start of the year. Sales are tracking 4.5% lower than in 2019 before the pandemic began.
Regionwide, supply has remained extremely low at 1.49 months, which is the amount of time it would take for the current inventory of homes to sell. This low supply of homes for sale has led to continued growth in housing prices. The median sales price in the Philadelphia Metro region was $350,000 in August, a 7.7% increase from a year ago.
With higher home prices, rising interest rates and economic uncertainty for the future, buyer demand is softening across all housing types. However, Bright MLS’ market outlook for the region is for housing prices to moderate this fall as the slowdown in sales creates greater inventory. Sellers may need to “reset price expectations” in the months ahead, the report said.
“As we head into the fall market, buyers should expect to find more options and will potentially have more leverage on price, as sellers are readjusting their expectations,” said Dr. Lisa Sturtevant, Bright MLS chief economist said.
“Buyers will also find they have more time to make decisions and will be in the position of asking for home inspections and appraisals, concessions that were virtually unheard of last year, and are signs of balance inching back into the overall market.”
The seven counties included in the Philadelphia Metro region report are Mercer, Burlington, Camden, Gloucester, Cumberland, Salem and Ocean counties.