How to Buy a House in Pennsylvania: A Homebuyer’s Guide
Updated: February 9, 2024
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According to Zillow, the average cost of properties in Pennsylvania is $268,984. This value has increased by 10.1% within one year. The average price can significantly increase or decrease based on where you plan to buy a property. For example, Milesburg is one of the cheapest places to buy a house in Pennsylvania and properties cost $191,708.
Properties are cheaper in Pennsylvania compared to the national average of $357,810. Nevertheless, its affordability depends on your financial circumstances, needs and what you're looking for in a new home. To avoid debt due to mortgage loans, you need to be familiar with the homebuying process.
Choose an Ideal Location
Location significantly influences the cost of real estate. That's why "location, location, location" is one of the most common mantras in real estate. The neighborhood culture, proximity to facilities, activities and other factors contribute to the cost of a house. It's best to pay attention to these details when checking different homes and locations.
Calculate Mortgage Rates
Homebuyers have a variety of mortgage loan options to choose from. These loans vary in rates, terms, qualification requirements and many other factors. You can choose from conventional, VA, USDA and FHA home loans. When deciding which one to apply for, it's important to weigh their pros, cons and overall costs.
Prepare Down Payment Requirements
A down payment plays a significant role in your home financing, besides it being the amount you pay out of your pocket before buying a house. The amount you put down on the house affects your loan's overall cost and interest rate. The typical down payment is 20%, but down payment requirements may differ depending on your mortgage arrangement.
Get Pre-Approved for a Mortgage
Both prequalification and pre-approval allow borrowers to check their creditworthiness for a mortgage loan. You will need to provide your basic credit information in a prequalification, but it might not be as thorough as a pre-approval. A pre-approval analyzes your financial data more and then issues you a pre-approval letter after a few days. When buying a home, pre-approval may be necessary when you submit an offer.
Conduct a Home Inspection
You should ensure you'll be completely safe in a house before buying it. A home inspection allows you to carefully examine the building's design, electrical systems, plumbing and other features. By doing this, you can ensure that there won't be any issues with the house.
Close Your Mortgage Loan
The final step of the process is to close your mortgage loan. There may be several documents required to close your mortgage. Review the terms and go over the specifics before signing any paperwork. Remember to include closing costs in your budget since these can accumulate as you seal the deal with your lender.
Pennsylvania Homebuying Details
The homebuying process can be relatively similar across different states. However, there are nuances and specific guidelines for each state.
Some details in Pennsylvania are unique and involve homeowner assistance programs and requirements. Consider looking into these details to avoid overlooking them and missing some crucial points during the process.
Dual agency
One real estate agent can represent both the seller and the buyer of the property. It's legal in Pennsylvania as long as the seller and the buyer give written consent.
Seller's disclosure
This is one requirement provided by law. A seller needs to give a property disclosure statement containing the problems around the house, information about the structure and other improvements added to the house.
Homeowner assistance programs
There are several homeowner assistance programs in Pennsylvania. You can look into the Pennsylvania Housing Finance Agency (PHFA) for different kinds of financial assistance in the state. Homebuyers in rural communities can also apply for U.S. Department of Agriculture Rural Housing programs. The Department of Housing and Urban Development (HUD) has also put together multiple programs, especially in the local government units for counties in Pennsylvania.
Frequently Asked Questions About Buying a Home in Pennsylvania
MoneyGeek answered frequently asked questions on how to buy a home in Pennsylvania. These can give you more insight into property costs in the state and how this purchase can affect your budget.
When buying a home in Pennsylvania, consider asking yourself the following questions:
- What's the best location for a home?
- How much can I afford, and how much funding can I get?
- How much down payment can I make for a home?
It depends on you, your circumstances, needs and preferences. The cost of a property in Pennsylvania is cheaper than the national average. Therefore, this can be your starting point if you're looking for more affordable housing.
In 2022, the prices of properties in Pennsylvania have increased by 10.1% in the past year. It could benefit you as real estate prices continue to rise. It would be best if you also considered other factors regarding the value of real estate properties.
You can check your creditworthiness for a mortgage loan through pre-approval. This process will help you check how much loan you can get from a lender and your eligibility for loans.
The property tax rate in Pennsylvania is 1.49%. The amount you pay for property tax may vary based on your home's value and location.
Milesburg may have the cheapest rates for real estate properties in Pennsylvania. The cost of your home will depend on your location or your neighborhood.
sources
- American Society of Home Inspectors. "Home Inspection Requirements for Pennsylvania." Accessed October 23, 2022.
- Consumer Financial Protection Bureau. "Get a Prequalification or Preapproval Letter." Accessed October 23, 2022.
- Consumer Financial Protection Bureau. "Mortgage Closing Checklist." Accessed October 23, 2022.
- Pennsylvania Housing Finance Agency. "Mortgage Housing – Foreclosure Options." Accessed October 23, 2022.
- Tax Foundation. "Taxes In Pennsylvania." Accessed October 23, 2022.
- U.S. Department of Housing and Urban Development. "Homeownership Assistance: Pennsylvania." Accessed October 23, 2022.
- USDA Rural Development. "Pennsylvania." Accessed October 23, 2022.
- USDA Rural Development. "Single Family Housing Direct Home Loans in Pennsylvania." Accessed October 23, 2022.
- Zillow. "Pennsylvania Home Values." Accessed October 23, 2022.
- Zillow. "United States Home Values." Accessed October 23, 2022.