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Fewer Philadelphia Bank Owned Homes Mean Higher Prices

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By : John Cutts    99 or more times read
The drop in number of Philadelphia bank owned homes has allowed house prices in the area to improve significantly in March. Total sales also improved as buyers rushed to beat the deadline of the federal tax incentive.

The median price for homes in the Philadelphia region increased by 1.2 percent in March, the third time the price median rose from the previous month. In the Northeast region where Philadelphia is situated, the median price for homes jumped up to $249,800, up by almost 9 percent from the median one year ago.

Despite price increases in the region, total sales of pre-owned homes in the Philadelphia region shot up by nearly 21 percent in March, as buyers took advantage of still lower mortgage rates and beat the federal tax credit deadline.

Another research firm also reported that total home sales in Philadelphia spiked by 19 percent compared to sales one year ago. Home sales in other Northeast cities also increased, with New York posting a 40-percent increase, Boston posting 31 percent and Pittsburgh posting 21 percent. The highest rate of increase was posted by Augusta in Maine, which achieved a whopping 60-percent jump in sales.

Philadelphia bank owned homes and other distressed housing units accounted for only 6 percent of total home sales in March, as foreclosure inventories declined. With fewer foreclosures, buyers looked for nondistressed existing homes, which were still priced far below their peak levels despite increases from the previous months.

In contrast to the slowdown in sales of real estate owned homes in Philadelphia, the number of bank owned homes in Pennsylvania increased in March. A total of 5,664 homes in the state were notified of delinquency, foreclosure sale or repossession in March, equivalent to one foreclosure filing for every 970 houses in the state.

The total March filings marked an increase of 37 percent from the February filings and a jump of 15 percent from filings in March last year. The sharp increase in properties that entered bank owned home listings in March showed the sharp impact of unemployment.

In March, the 9-percent unemployment rate in Pennsylvania was still higher by 1.5 percentage points than the 7.5 jobless rate in the state in March last year. Nevertheless, the state jobless rate was still lower than the 9.7-percent nationwide rate.

For prospective buyers of Philadelphia bank owned homes, the right time to buy is now, as Philadelphia is among the cities expected by analysts to continue to post price increases in the coming months.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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