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September 30, 2020

Tips for buying a home in Philly’s red-hot real estate market

Real Estate Homes

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Rowhomes in Fairmount Thom Carroll/for PhillyVoice

The Philadelphia residential real estate market is red hot. You've surely read in the media how inventory is historically low and the homes that are available are flying off the shelf rapidly, especially if they are turnkey and recently renovated. Plus, interest rates are also historically low.

The silver lining post-Covid for Philly real estate is demand from a combination of home buyers. As more people are able to work from home, Philly locals are seeking larger homes, former Philly residents are moving back to their home city, and folks from other cities are seeing the value of relocating here.

“We're biased, but we all know Philly is a world class city with amazing cultural institutions, some of the best history, beautiful parks and streetscapes, and a robust economy,” says Todd Hovanec, Director of Real Estate Services for Prevu in Philadelphia.

Are you planning to buy a home in Philly? Below are a few tips to help you succeed.

Get your ducks in a row

The best way to buy a home in a competitive market like Philly is to be prepared. Make sure your Buyer Financial Statement is filled out and get your pre-approval updated with your lender. Do these tasks early so that you're not asking your loan officer on a Saturday afternoon for an updated pre-approval letter for an offer that is due Sunday night!

Also, be sure to request a pre-approval letter from your lender and not a pre-qualification letter, when possible. A pre-qualification is less meaningful to a seller and their agent compared to a pre-approval.

Go over the contract and contingencies with your agent early in your home buying journey so you understand the process. That way you’ll be ready to roll when the time comes to make an offer.

Ask for a commission rebate

Traditional real estate brokers make a lot of money, but they don’t offer commission rebates. Luckily, the tech-enabled brokerage Prevu offers the largest commission rebate in Philly. With Prevu’s Smart Buyer Rebate Program, homebuyers receive a commission rebate up to 2% of the purchase price depending on the buyer’s agent commission offered.

For a purchase price of $500,000 for example, with a 3% buyer’s agent commission, a commission of $15,000 will be generated, of which $10,000 will be rebated back to you after settlement. That’s money in your pocket, not your broker’s!

There are several ways a commission rebate can benefit buyers. For example, the $10,000 rebate in the above example can be used to offset closing costs, boost your budget in a bidding war, replenish your savings, or help you buy furniture after you buy.

How will you use your rebate?

See homes early when they hit the market

Home buying is moving fast, and buyers are making decisions quickly. It is very common right now that homes are going to bidding wars after just one weekend on the market! Unless you can tour the property early, you'll likely miss out.

While this is not convenient for people who work, which is most buyers, touring homes during the week before others gives you a chance to scoop a property before someone else does. If you have time, see properties as soon as they come on the market, even if it’s during your lunch break.

Using real estate platforms like Prevu will help you stay updated with property alerts and the ability to book tours quickly with the click of a button online.

Be ready. Get a rebate. Be smart.


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