If you're a local, you know that you can cross the line into PA or MD within just 5-10 minutes from the Newark, Hockessin or Pike Creek area - it's all so close. What you may not know is that some builders actively built neighborhoods in more than 1 state. For example, the Hillstream neighborhood spans both Newark, DE and Landenberg PA. In addition, Thistleberry Farms in Newark, DE has the exact same floor plans.
What does this mean to the real estate consumer? When looking for a home, make sure you and your real estate agent look at the value across state lines - even if you prefer one state. Looking at the comparables of these homes can help you understand whether or not the home you are considering bidding on is a good value or not.
For example, a buyer client of mine recently bid on a home in PA and the buyer and seller could not come to an agreement on price, so no deal was struck. As interest rates came down, the PA home became more affordable in monthly payment terms, however by then the buyer and I were looking both in PA and DE at other homes. We found a home in DE with the exact same floor plan, with many more upgrades, for a slightly higher asking price. However, with the lower DE property taxes, the all-in cost to my buyer was less that the original home in PA. Our buyer chose the DE home, and happily settled two days ago (see video).
What insights can we share from this scenario?
- Whether selling or buying, when negotiating on your home, you benefit by working with a full-time agent who is active and experienced in the local market (which in our area includes real estate across the line by being active and licensed in DE, PA & MD).
- In a volatile interest rate market, realize that market moves on any given day can affect consumers' purchasing power. As a buyer or a seller, work with a team that has a top-notch mortgage consultant so that you know how the interest rate markets are affecting purchasing power daily. It can make the difference between a contract or a "no sale".
Does this mean DE is a better value than PA or MD?
Absolutely Not! There are many factors that come into play when purchasing a home - commute, school choices, asking price, taxes - both real estate and income depending on where you work, deed restrictions, laws (such as homeschooling), and plain old preference. The key is to know your requirements and your preferences if you are a buyer, then use a team of experts in the area to help you find your next home and negotiate the best financial deal. And if you are a seller, work with a team that can market your home's benefits and value - there is a buyer for your home if it's priced in the market, staged to show well, and marketed properly.
John (302-740-5872)
