Skyline of Philadelphia, Pennsylvania, on a clear day

Buying a home in
Philadelphia

Q: How much is the transfer tax, and who pays it?

In the city it is 4.578% of the price: 3.578% to Philadelphia and 1% to Pennsylvania. The city says it is usually split evenly between buyer and seller, though that is custom and not a legal requirement, and the city can collect the whole amount from either party. On a $400,000 home, half is $9,156. Suburban municipalities have their own local rates on top of the 1% state tax.

Q: What does the homestead exemption do?

It reduces the assessed value of your home by $100,000 before the tax rate is applied, which saves most homeowners up to $1,399 a year. You must own the home and live in it as your primary residence, and apply by 1 December. A home you let or use as a second home does not qualify, and neither does a home that is still receiving the ten-year abatement.

Q: What is the ten-year tax abatement?

Philadelphia reduces property tax on the building value of newly built homes for ten years. For abatements applied for since 2022 the benefit shrinks each year: 100% of the building value is abated in the first year, 90% in the second, down to 10% in the tenth. When you buy a new or recently built home, ask which year of the abatement it is in and what the tax will be once it ends.

Q: Can I let a Philadelphia property short-term if I do not live there?

It is possible but not simple. Stays of fewer than 30 days require a licence. If the home is not your primary residence you need a rental licence with a hotel designation, a commercial activity licence and a zoning permit for visitor accommodation, and you must remit the 8.5% hotel tax monthly. Whether a zoning permit can be obtained depends on the district, so check before you buy.

Q: Do I need a lawyer to buy in Pennsylvania?

It is your right, not an obligation. Pennsylvania's consumer notice tells buyers they are entitled to have an attorney review the agreement of sale and represent them at settlement. As a general rule, any attorney acting for the lender or the seller does not represent you. For a first US purchase, having your own is sensible.

Philadelphia sits between New York and Washington and costs far less than either. Europeans come for the universities and the pharmaceutical industry around the city. The surprises are a transfer tax of more than 4.5% and a city wage tax that follows you to work.

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Everything about buying in Philadelphia

Short answers on this page. The full guide has the detail, the figures and the sources.

The purchase and the loan

How a purchase runs here and which loans fit.

Financing

Prices, taxes and insurance

What homes cost and what you pay on top.

Property tax and the reliefs
Letting and inheritance

Letting and living

Rental rules, local life and how to get there.

City or suburbs

Read the full guide

Why Philadelphia

Price is the first answer. The median home across the Philadelphia metro area sold for $425,000 in August 2026, compared with $640,000 in the Washington metro area and roughly $860,000 in the city of Boston. For a household arriving from Europe with a fixed budget, that is the difference between a flat and a house.

The second answer is work. The University of Pennsylvania has more than 21,000 faculty and staff, a further 45,000 in its health system, and nearly 6,800 international students. The wider region is home to pharmaceutical and life sciences employers, and the city lies on the main rail line between New York and Washington.

Brick row houses with shutters along cobblestone Elfreth's Alley in Philadelphia, Pennsylvania

Philadelphia at a glance

Figures last checked: 3 October 2026

This is not a lending decision: a US specialist confirms what applies to your own situation.

Median sale price	$425,000 across the Philadelphia metro area, August 2026, up 4.9% on the year (Bright MLS).
Loan limit 2026	$832,750 for a one-unit home in Philadelphia County.
Property tax	1.3998% of assessed value in the city: 0.6159% city plus 0.7839% school district.
Homestead exemption	$100,000 off the assessed value for owners who live in the home, saving up to $1,399 a year.
Transfer tax	4.578% of the price in the city (3.578% city plus 1% state), usually split evenly between buyer and seller.
Income taxes	Pennsylvania 3.07% flat. Philadelphia wage tax 3.735% for residents and 3.425% for non-residents who work in the city.
Flights home	American Airlines flies to about 18 European destinations from Philadelphia in summer, adding Prague and Budapest in 2026.

Ben Franklin Bridge spanning the Delaware River, framed by leaves, near Philadelphia

Aerial view of snow covered rowhouses on residential streets in Philadelphia, Pennsylvania

Philadelphia Museum of Art and its front steps seen from above with the Schuylkill River beyond

Autumn colors in Fairmount Park beside the Schuylkill River with the Philadelphia skyline beyond

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Before you make an offer in Philadelphia

Decide between city and suburbs with the wage tax in mind.
Budget for your share of the 4.578% transfer tax in cash.
Check whether you qualify for the homestead exemption and apply by 1 December.
For a new-build, ask which year of the abatement applies and what the tax will be afterwards.
Get a pre-approval from a lender that understands your visa status.
Consider your own attorney to review the agreement of sale.
If you plan to let short-term, confirm the zoning before you buy.

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Questions people moving from Europe ask

How much is the transfer tax, and who pays it?

What does the homestead exemption do?

What is the ten-year tax abatement?

Can I let a Philadelphia property short-term if I do not live there?

Do I need a lawyer to buy in Pennsylvania?

Continue your research

Sources (16)

Figures and rules on this page were checked against these sources on 3 October 2026. Rates, prices and local rules change, so confirm anything you rely on before you commit.

Buying a home inPhiladelphia