Buying in Philadelphia: the full guide

City or suburbs

Philadelphia itself is a city of row houses: narrow brick terraces that a European will find familiar. The suburbs, in Montgomery, Delaware, Chester and Bucks counties and along the railway known as the Main Line, offer detached houses and separate school districts, each with their own property tax rates.

The choice affects more than the house. The city levies a wage tax on residents wherever they work and on non-residents who work in the city, 3.735% and 3.425% respectively from July 2026, on top of Pennsylvania's flat 3.07% income tax. Someone who lives and works in the suburbs pays neither city rate, though suburban municipalities have their own local taxes.

Property tax and the reliefs

The city's rate is 1.3998% of assessed value, and homes are assessed at market value. On a home assessed at $400,000 that is $5,599 a year, by our arithmetic. Owner-occupiers can take $100,000 off the assessed value with the homestead exemption, which brings the same bill to $4,199. Bills are sent in December and due at the end of March.

New-build homes may carry the ten-year abatement, which reduces tax on the building's value on a sliding scale. It is a real saving in the early years and a real increase later, and it transfers with the property. Ask for the abatement's start date and model the tax without it.

Financing

The conforming loan limit in Philadelphia County is the national baseline of $832,750 for 2026, comfortably above most prices. A European who is lawfully resident on a visa can obtain a conventional loan on the same terms as a US citizen, subject to the lender establishing status and to its own requirements. Buyers who live abroad use foreign national loans. See how your status decides the loan.

Budget for the transfer tax in cash. At 4.578% of the price it is a large sum even when split with the seller, and it is due at settlement along with your other closing costs.

Letting and inheritance

Long lets require a rental licence. Short lets of under 30 days in a property that is not your primary residence need a hotel-designated rental licence and visitor accommodation zoning, with hotel tax of 8.5% on receipts.

Pennsylvania has an inheritance tax in place of an estate tax. It is charged on what heirs receive: nothing for a surviving spouse, 4.5% for children and other direct descendants, 12% for siblings and 15% for others. For an owner who is not a US resident, the federal estate tax rules for non-residents also apply, with a filing threshold of $60,000 of US assets. Take advice before choosing how to hold the property.

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