The Pennsylvania real estate market in 2025 looks very different from just a few years ago. Mortgage rates are finally dipping, new types of buyers are entering the market, and unexpected areas are seeing a rise in demand.
Whether you’re an experienced agent or just starting out, it’s important to understand how these changes are shaping the Keystone State. In this guide, we’ll cover the biggest trends, point out the markets to watch, and take a look at what’s happening in the luxury housing space.
Mortgage Rates Are Going Down
After years of climbing, mortgage rates are finally heading in the other direction. While the drop isn’t dramatic, it’s enough to get more buyers interested. Lower rates are giving people a reason to jump back into the market, especially those who couldn’t afford to buy when rates were higher.
For agents, this is the perfect time to reach out to buyers who were holding off. The chance to lock in a better rate might be just what they need to make a move.
Home Prices Are More Stable
The days of wild price hikes and bidding wars are behind us. In 2025, Pennsylvania’s home prices are rising at a slower, steadier pace. Homes are also selling closer to their asking prices, which means the market is more balanced for buyers and sellers alike.
This shift helps buyers feel less rushed, bringing back inspections and other contingencies. Sellers, however, might need help setting realistic expectations if they’re still dreaming of multiple offers and skyrocketing bids.
Suburbs and Smaller Markets Are Thriving
Big cities like Philadelphia and Pittsburgh are still major players, but in 2025, smaller markets are gaining traction. Towns like Lancaster, Scranton, and Erie are seeing more interest, especially from buyers who don’t need to live near a major city for work.
These areas offer more space, lower prices, and a quieter lifestyle — all things that remote workers and families are drawn to. For agents, exploring these growing markets could open up new opportunities.
Spotlight on Hot Markets
Here are a few of Pennsylvania’s standout markets in 2025:
Philadelphia: Revitalized neighborhoods and downtown condos are attracting younger professionals.
Pittsburgh: Suburbs like Cranberry Township are popular with families, while new grads love the city’s revitalized areas.
Allentown: Downtown upgrades and easy highway access are turning Allentown into a hotspot for investors.
Lancaster: A mix of historic charm and modern amenities is making Lancaster a top choice for buyers.
Luxury Housing Is Holding Steady
The luxury market in Pennsylvania — homes priced over $1 million — is steady this year. While competition isn’t as intense as it was in 2022, upscale homes in suburban areas near Philadelphia and Pittsburgh are still in demand.
If you’re focused on luxury properties, this is a good time to build connections with business leaders, executives, and other high-net-worth clients. This group values expertise and a personal touch, so make sure you stand out by offering both.
Should You Get Into Real Estate in 2025?
This year is full of opportunities for new and experienced agents alike. Mortgage rates are stabilizing, prices are less extreme, and up-and-coming markets are creating fresh chances to grow your business.
If you’re just getting started, invest in solid training and focus on learning everything you can about your local market. If you’ve been in the game for a while, consider expanding into secondary markets or building your expertise in luxury real estate. No matter your path, 2025 is shaping up to be a strong year for real estate in Pennsylvania.
Updated 1/15/25