Buying Real Estate In Pittsburgh

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How To Buy Real Estate In Pittsburgh – A Guide By the Pittsburgh Property Diva

Pittsburgh, known for its steel industry history, has much more to offer today, including scenic views, unique architecture, reputable universities, and iconic sports teams. Moreover, it boasts an affordable real estate market. If you’re considering investing in Pittsburgh real estate or simply curious about the process, this guide covers everything you need to know.

Understanding Pittsburgh’s Neighborhoods

Pittsburgh is home to 90 unique neighborhoods, each with its own distinct attributes, ranging from school districts and parks to the cost of living and available amenities. Before you start hunting for a house, it’s crucial to research each neighborhood, considering factors like property prices, proximity to your workplace, and how well it suits your lifestyle. Remember, the needs of a family of five will vary significantly from those of a retiree or young couple. If you’re unsure where to start, a local realtor such as the Pittsburgh Property Diva will guide you towards neighborhoods that align with your preferences.

Preparing to Buy a House in Pittsburgh

Here are some great resources from The Pittsburgh Property Diva if you are planning on buying real estate in Pittsburgh:

RESOURCES FOR BUYING A HOME IN PITTSBURGH

1. Saving For a Down Payment

The first step towards owning a house is saving for a down payment. The median sale price for a home in Pittsburgh in March 2023 was $217,000, according to Redfin data. A typical down payment of 20% on this price would amount to $43,400. However, don’t panic if this figure seems daunting. You can opt for loan programs that require as low as 3% down payment, and some even require none at all (subject to certain conditions). There are also down payment assistance programs that can help lighten the financial load.

2. Securing Mortgage Preapproval and Choosing a Lender

After saving for a down payment, apply for a mortgage preapproval. This process provides a rough estimate of how much a lender is likely to loan you, which is crucial for budgeting purposes. It also signals to sellers that you’re a serious, qualified buyer.

Once you’re in contract on a home, you’ll need to apply for official mortgage approval. While you can stick with the same company that preapproved you, don’t feel obligated to do so. Shop around to find a lender that offers the best terms. Keep in mind that the lowest interest rate doesn’t necessarily mean the best deal. Some lenders may charge additional fees and offer fewer services for your money, so be sure to do your homework.

3. Finding a Real Estate Agent in Pittsburgh

A knowledgeable local agent can make your house-hunting process much smoother and more efficient. They can help you identify listings that best suit your needs based on your budget and preferences. Look for an agent who specializes in the areas you’re interested in. For instance, if you’re interested in Squirrel Hill North, an agent primarily operating in the southern suburbs may not be the best fit. Take your time, interview several candidates, and select someone you’re comfortable working with.

4. House Hunting and Making an Offer

With a trusted agent by your side, you’re ready to start shopping. While the housing market has cooled slightly since the rapid-paced years of 2021 and 2022, it still pays to be quick on your feet. Pittsburgh homes on the market tend to garner an average of three offers, according to Redfin — so stay in close contact with your agent to see homes you’re interested in as soon as possible. When you find a home that ticks the right boxes, don’t dawdle. Your agent can help you draft a solid offer, which should include your preapproval letter, and negotiate on your behalf if needed.

5. Planning for Home Inspection and Appraisal

When your offer is accepted and you go into contract, the next steps are getting an inspection and an appraisal. You’ll need to hire a licensed home inspector to assess the condition of the home and property. Inspectors will look through the house, top to bottom, to find potential issues with anything from the roof to the foundation to the plumbing and electrical. They’ll create an inspection report outlining everything they find. If major issues are found, you’ll need to work it out with the seller — they might pay for repairs or offer a credit to cover the cost.

Your lender will require a home appraisal, which is different from the inspection. An appraiser examines the property to assess its value — the lender doesn’t want to offer up more money than the home is worth, after all. Appraisers take many factors into consideration, including recent local sales, tax records, home condition and more.

Requirements for Buying a House in Pittsburgh

Homebuyers who want to finance the purchase will have to prove their credit-worthiness to a mortgage lender. Many factors will influence a lender’s decision on whether to loan you money and how much, including your credit score (the higher your score the better) and your debt-to-income ratio (or how much other debt you have, like car payments and student loans, compared to how much you earn).

Assessing Affordability

Pittsburgh’s cost of living aligns with the national median, according to RentCafe. However, its home prices are significantly lower than much of the rest of the country. The median home price was $217,000 as of March 2023, which is quite a bit below the nationwide median of $375,700.

According to Bankrate’s mortgage calculator, for a median-priced $217,000 home with a 20 percent down payment and a 30-year fixed mortgage at 6.5 percent, monthly principal and interest payments would come to $1,097 (excluding property taxes, insurance premiums, and other fees).

Redfin data shows that prices in Pittsburgh are falling slightly, down 8.1 percent from March 2022 to March 2023, and they’re also staying on the market more than two weeks longer than this time last year. While it’s still a seller’s market in many neighborhoods, buyers have more leverage than they’ve had in recent years.

Programs for First-Time Homebuyers in Pittsburgh

For first-time buyers, there are state assistance programs that can help with your down payment or closing costs. Other programs at the federal and local level may also offer assistance in the form of grants and low- or no-interest loans to qualifying individuals.

Closing on Your Pittsburgh Home

The home closing is where all the pieces finally come together. You’ll need to sign a stack of documents and pay some fees, also known as closing costs. These costs could include:

These costs may vary depending on the cost of your home, your chosen lender and the location of your home. For example, you’ll experience higher transfer taxes within Pittsburgh city limits than you would in the surrounding suburbs. But when it’s all over, you’ll get the keys to your new home. Congratulations, Pittsburgh homeowner!

Frequently Asked Questions

  • Are home prices in Pittsburgh falling or rising?  According to data from Redfin, Pittsburgh home prices fell 8.1 percent from March 2022 to March 2023. However, they are up month-over-month: The median sale price in February was $212,500, while in March it was $217,000.
  • What’s the best time to buy a house in Pittsburgh?  While warmer months may offer more selection and higher prices, colder months typically have less selection but better prices. Ultimately, the best time to buy depends on your personal circumstances and priorities. Regardless of the season, the higher your credit score, the better mortgage rate you’re likely to be eligible for. If your score is not great, it may be beneficial to work on improving it before you start house-hunting.

Remember, buying a house is one of the most significant financial decisions you’ll ever make. Armed with the right information and guidance, I can help you navigate the Pittsburgh real estate market confidently and make a truly life-changing investment.

You can contact the Pittsburgh Property Diva through her website right here!

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