Pittsburgh is a thriving city located in western Pennsylvania with a population of over 300,000 people. The city has a rich history and culture, with a booming economy that attracts people from all over the world. One of the most significant aspects of Pittsburgh's growth is its real estate market.
Pittsburgh sits where the Allegheny and Monongahela Rivers meet and form the Ohio River. That location gave it access to the ocean and the interior, while nearby iron deposits fueled its growth. As of now, the Pittsburgh housing market appears to strike a balance, offering opportunities for both buyers and sellers.
With a median sale price 38% lower than the national average, buyers can find affordability in a somewhat competitive environment. Sellers, on the other hand, benefit from a market where 19.6% of homes sell above the list price, indicating favorable conditions for maximizing returns.
Pittsburgh Housing Market Trends in 2024
How is the Housing Market Doing Currently?
In January 2024, the Pittsburgh housing market exhibited resilience and growth, with home prices experiencing a commendable uptick of 4.2% compared to the previous year. According to Redfin, the median selling price reached $215K, making homeownership in Pittsburgh an attractive prospect.
Notably, homes in the area spent an average of 68 days on the market, showcasing increased demand and a faster selling pace compared to the 72 days recorded the previous year. The month saw 276 homes changing hands, a noticeable increase from the 252 transactions in January of the preceding year.
It's worth highlighting that Pittsburgh's median sale price stands at 38% below the national average, contributing to its status as a somewhat competitive market. Homes in the region typically sell within 66 days, indicating a market where prompt decision-making is essential.
How Competitive is the Pittsburgh Housing Market?
Pittsburgh's housing market presents an environment of moderate competitiveness. A notable 19.6% of homes sell above the list price, reflecting the existence of multiple offers in certain instances. On average, homes sell for approximately 4% below the listed price and go pending within 66 days. However, the landscape also features a segment of hot homes that can command 1% above the list price, with a swift pending time of around 37 days.
Examining the sale-to-list price ratio, the market stands at 95.3%, indicating a slight uptick of 0.3% year-over-year. This metric showcases the negotiation dynamics between sellers and buyers, offering insights into the prevailing market conditions.
Are There Enough Homes for Sale in Pittsburgh to Meet Buyer Demand?
The Pittsburgh housing market has seen a 19.7% increase in homes with price drops year-over-year, suggesting a certain level of flexibility in pricing strategies. This may indicate a response to market dynamics, ensuring that homes remain attractive to a broad spectrum of potential buyers.
What is the Future Market Outlook for Pittsburgh?
Considering the migration and relocation trends in Pittsburgh from December '23 to February '24, 19% of homebuyers expressed a desire to move out of the city, while an overwhelming 81% aimed to stay within the metropolitan area. This data indicates a strong local affinity, potentially contributing to the stability of the housing market.
Furthermore, national trends reveal that 0.54% of homebuyers across the nation searched to move into Pittsburgh from outside metros. Notably, New York homebuyers showed the highest interest in relocating to Pittsburgh, followed by Washington and Los Angeles.
Pittsburgh Housing Market Forecast for 2024 and 2025
Pittsburgh has been one of the hottest real estate markets in the country for years. It is also one of the hottest real estate markets for investing in rental properties. What are the Pittsburgh real estate market predictions for 2024? Let us look at the price trends recorded by Zillow over the past few years.
According to Zillow, the Pittsburgh housing market is experiencing a steady upward trend. The average home value in Pittsburgh stands at $216,662, reflecting a 4.8% increase over the past year. Homes in this area typically go pending in approximately 26 days, emphasizing the demand and swift turnover in the market as of January 31, 2024.
Key Housing Metrics
- For Sale Inventory (January 31, 2024): The market boasts 1,710 available properties for potential buyers.
- New Listings (January 31, 2024): In the same period, 404 new listings have been introduced to the market, adding to its dynamism.
- Median Sale to List Ratio (December 31, 2023): The ratio stands at 0.985, indicating a balanced relationship between listing and sale prices.
- Median Sale Price (December 31, 2023): The median sale price for homes in Pittsburgh is $213,883.
- Median List Price (January 31, 2024): Homes are listed at a median price of $249,933, showcasing the value and potential returns for sellers.
- Percent of Sales Over List Price (December 31, 2023): A significant 28.8% of sales in December 2023 surpassed the list price, indicating a competitive market.
- Percent of Sales Under List Price (December 31, 2023): 55.7% of sales occurred below the list price, providing options for budget-conscious buyers.
Pittsburgh MSA Housing Market Forecast
The Pittsburgh Metropolitan Statistical Area (MSA) is poised for growth, as indicated by the forecast. The MSA, encompassing various counties in the state of Pennsylvania, demonstrates a positive trajectory. The forecast, extending from February 29, 2024, to January 31, 2025, suggests a gradual increase in housing market performance. Starting at 0.2% on January 31, 2024, the forecast predicts a steady climb to 1.1% by April 30, 2024, and a more substantial rise to 2.8% by January 31, 2025.
The Pittsburgh Metropolitan Statistical Area (MSA) encompasses a collection of counties in the state of Pennsylvania, forming a significant economic and cultural hub. The housing market within the MSA is expansive, attracting diverse buyers and sellers. With a forecast indicating growth, the MSA's housing market is poised to play a crucial role in the broader regional real estate landscape.
Are Home Prices Dropping in Pittsburgh?
As of the latest data, there is no evidence to suggest that home prices in Pittsburgh are dropping. On the contrary, the average home value has experienced a 4.8% increase over the past year, highlighting a positive trend in property values. This stability bodes well for homeowners and sellers in the Pittsburgh housing market.
Will the Pittsburgh Housing Market Crash?
The current indicators do not signal an imminent housing market crash in Pittsburgh. With steady price growth, moderate inventory levels, and a balanced sale-to-list ratio, the market appears resilient. However, it's essential to monitor economic factors and external influences that may impact the real estate landscape in the future.
Is Now a Good Time to Buy a House in Pittsburgh?
For potential homebuyers, the decision to buy a house in Pittsburgh depends on individual circumstances and goals. While the market favors sellers, opportunities exist for buyers who are well-prepared and have a clear understanding of their preferences and budget. The forecasted growth in the Pittsburgh MSA suggests potential appreciation, making it a consideration for those looking to invest in real estate.
Pittsburgh Real Estate Investment Overview
Now that you know where Pittsburgh is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Is Pittsburgh a Good Place For Real Estate Investment? Many real estate investors have asked themselves if buying a property in Pittsburgh is a good investment. You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers.
If you are looking to make a profit, you don’t want to buy the most expensive property on the Pittsburgh real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Pittsburgh that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.
Let’s take a look at the number of positive things going on in the Pittsburgh real estate market which can help investors who are keen to buy an investment property in this city. Pittsburgh, Pennsylvania is home to around 300,000 people. However, the Pittsburgh real estate market is much larger than this. The entire metro area is home to over two million people. Pittsburgh ranked at the top of Nationwide’s 2015 Health of Housing Market Report. It is home to approximately 90 diverse and eclectic neighborhoods and many of them offer convenient access to downtown and urban amenities.
The overall stability of Pittsburgh’s economic outlook has contributed significantly to the gains seen in the real estate market. This can be seen in two distinct areas, employment rates, and median household income. Several neighborhoods in Pittsburgh are seeing an influx of growth that is spurring new construction and contributing to retail growth. Pittsburgh has also been recognized as one of only four metropolitan areas out of 200 studied by economists at Realtor.com.
What Makes Pittsburgh Real Estate Market Attractive For Investment? |
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It Is Landlord Friendly
The Pittsburgh real estate market can be considered landlord-friendly. There are rules regarding security deposits, and depending on the situation, you may have to pay rent on the security deposit. On the upside, there is no limit on late fees and they don’t have to be written into the rental agreement, though this is recommended. You don’t have to give notice before entering. The state, at least, doesn’t require a rental license to become a landlord. Pittsburgh has passed a rental registration regulation, but it is being challenged in the courts.
The Strong Local Economy Attracts Residents
The unemployment rate for Pittsburgh is around 5%. The unemployment rate for Pittsburgh parallels that of the state of Pennsylvania. Employment growth is growing broadly, with seven of the ten major industries seeing job gains. Notably, the unemployment rate for the Pittsburgh real estate market is somewhat better than that in Fayette County and Armstrong County. The Pittsburgh real estate market is seeing a surprising renaissance because it is reinventing itself as a high-tech hub.
The CBRE listed it as the third market in the U.S. for high-tech job growth. That same tech boom is radically altering the commercial real estate market. With many industries adding more jobs every month, which consists of manufacturing, leisure, technology, and health care, Pittsburgh’s economic prosperity will continue to foster a thriving housing market. Google, Apple Inc., Bosch, Facebook, Uber, Nokia, Autodesk, Amazon, Microsoft, and IBM are among 1,600 technology firms generating $20.7 billion in annual Pittsburgh payrolls.
Real Estate Investment In Pittsburgh Is Still Affordable
Real estate investment in Pittsburgh continues to offer an affordable opportunity for potential investors. With a market that boasts a diverse range of neighborhoods, stable pricing trends, and a balanced dynamic between buyers and sellers, Pittsburgh provides an attractive landscape for those seeking to enter the real estate investment arena. The city's relatively lower average home values and the potential for future growth, as indicated by forecasts, make it an appealing destination for investors looking to maximize their returns while entering a market that offers manageable entry points.
The Large Pittsburgh Rental Real Estate Market
Pittsburgh is a centuries-old city, so it is home to many colleges and universities. The area is home to 68 colleges and universities, including research and development leaders Carnegie Mellon University and the University of Pittsburgh. Each is home to several thousand students. Smaller schools like Vet Tech Institute and Dean Institute of Technology abound. The biggest is the University of Pittsburgh with almost 30,000 students, and it is growing. Pittsburgh State University is attracting so many students that the city approved a new mixed-use development near Fourth and Broadway Streets to cater to them.
As of January 2024, the median rent for all bedroom counts and property types in Pittsburgh, PA is $1,495. This is -23% lower than the national average. Rent prices for all bedroom counts and property types in Pittsburgh, PA have remained the same in the last month and have increased by 3% in the last year.
Another reason to invest in Pittsburgh over Philadelphia is that the latter has a history of being too aggressive in seizing property under asset forfeiture and then reselling it. While that presented a few deals to potential buyers, no one wants to worry about losing their home or rental property because a kid living there dealt drugs. The expensive deal Philadelphia had to agree to in order to compensate those whose homes were wrongfully taken will only add to the population’s tax bill in the future.
Maybe you have done a bit of real estate investing in Pittsburgh, PA but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. Pittsburgh is seeing an incredible renaissance, unlike many other Rust Belt cities. It is attracting new residents, redeveloping its downtown.
And it is an excellent place to invest in real estate while it is still in the early stages of its rebound. A good cash flow from Pittsburgh rental property means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt. Therefore, finding a good Pittsburgh real estate investment opportunity would be key to your success.
Apart from the Pittsburgh real estate market, you can also invest in Columbus, Ohio. The Columbus Ohio real estate market is a bright spot in a declining region. It mixes smart redevelopment, quality of life, and growth to create a stable, slow-growing market that will be thriving well into the foreseeable future. There are many neighborhoods to consider for buying properties in Columbus.
Properties in Worthington and downtown Columbus have higher than average median home prices, and their relatively low crime rates add additional appeal. Places like Victorian Village, where home prices remain higher than many other places in the city, support a strong local market, and they can signify a lower level of risk.
References
- https://www.redfin.com/city/15702/PA/Pittsburgh/housing-market
- https://www.zillow.com/Pittsburgh-pa/home-values
- https://www.realtor.com/realestateandhomes-search/Pittsburgh_PA/overview
- https://www.avail.co/education/laws/pennsylvania-landlord-tenant-law
- https://www.clevelandfed.org/newsroom-and-events/publications/metro-mix/pittsburgh/mm-201805-pittsburgh.aspx
- https://www.cbre.us/about/media-center/pittsburgh-number-3-market-in-north-america-for-hi-tech-job-growth
- https://www.geekwire.com/2018/ready-not-tech-boom-brings-complex-changes-pittsburghs-real-estate-market/