The First-Time Home Buyer Guide to Philadelphia

Buying your first home in Philadelphia? A few local rules change the math: a City grant for first-time buyers, a transfer tax that's higher than most of the country and tax abatements on a lot of newer homes. This guide follows the order Max Karasick walks first-time buyers through, with links to the deeper explainers when you want the details.

Start With the Monthly Number

The price a lender approves and the payment that fits your life are two different numbers. Start with the monthly payment that feels comfortable, counting principal, interest, real estate taxes, insurance and any condo or HOA fee, then work back to a price range. Get a lender preapproval next, so sellers take your offers seriously.

Check the Philly First Home Grant Early

Philly First Home pays up to $10,000 or 6% of the purchase price, whichever is less, toward your down payment and closing costs. There are income limits, you need City-funded housing counseling before you sign an agreement of sale and condos don't qualify. Since counseling has to come first, start it before you start touring if you might qualify. The Philly First Home grant guide has the details.

Read the Tax Bill, Not Just the Price

Two homes at the same price can have very different tax bills. Plenty of newer Philadelphia homes carry a tax abatement that keeps the bill low for a set number of years, and then it climbs when the abatement ends. If you live in the home, you can also apply for the Homestead Exemption, which takes $100,000 off the assessed value. The 10-year abatement guide shows how to compare them. For what's changing on Philadelphia tax bills and deadlines in 2027, see buying a home in Philadelphia in 2027.

Budget for Closing Costs

Philadelphia's realty transfer tax is 4.578% of the price, City and Commonwealth shares combined, and it's usually your biggest closing cost. Title insurance, lender fees and prepaid taxes and insurance pile on top. The transfer tax guide explains who typically pays what. Sellers can sometimes chip in on these costs, and seller credits and rate buydowns covers the limits by loan type.

Pick the Neighborhood Before the House

Commute, transit, block feel and housing stock can change a lot in a few blocks. Max's area guides cover Center City, Rittenhouse, Fishtown, Fairmount, Graduate Hospital and more. Torn between the city and the suburbs? Read Philadelphia vs New Jersey.

Make an Offer That Wins on Terms

Price is only part of a strong offer. Deposit size, inspection terms, the financing contingency and the closing date all matter to a seller. Max prices offers from recent sales and live competition, and he explains every term before anything goes in.

Inspect, Then Close

Once your offer is accepted, the inspection period is your chance to learn what the systems, roof and structure really need and to negotiate repairs or a credit. Then the lender finishes the loan, the title company preps the closing and you get the keys. That part never gets old.

How Max Uses This With Clients

Max starts every first-time buyer with this exact order: the monthly number, a Philly First Home eligibility check, then a side-by-side of tax bills on the homes you like. If the grant might fit, he gets counseling scheduled before the first tour, so no agreement of sale gets signed too early. Ready to start? Head to the buy page.

Maximize Your First Move.

Official Sources

• City of Philadelphia, Division of Housing and Community Development: Buy My First Home (Philly First Home)

• City of Philadelphia, Department of Revenue: Realty Transfer Tax

• City of Philadelphia: Homestead Exemption Update (June 2026)

Frequently Asked Questions

How much is the Philly First Home grant?

Up to $10,000 or 6% of the purchase price, whichever is less, as of October 2026. You can put it toward your down payment and closing costs. There are income limits and a counseling step that has to happen before you sign an agreement of sale, so check your eligibility early.

Who counts as a first-time buyer in Philadelphia?

For Philly First Home, someone who has never owned a home or hasn't owned one in at least three years. You also need to meet the income limits and finish City-funded housing counseling before you sign an agreement of sale, so it's smart to start counseling before you start touring.

What is the transfer tax in Philadelphia?

Philadelphia's transfer tax is 4.578% of the price, which combines the City and Commonwealth shares. For most buyers it's the single biggest closing cost, ahead of title insurance, lender fees and prepaid taxes and insurance. The transfer tax guide explains who typically pays what, so you can budget for your share.

What is the Homestead Exemption?

A Philadelphia program that takes $100,000 off the assessed value of an owner-occupied home before the real estate tax is calculated. If you live in the home, it's worth applying, since a smaller taxable value means a smaller bill. The 10-year abatement guide shows how it fits with abated homes.

Can a first-time buyer use the grant for a condo?

No. The City states that condominiums are not eligible for Philly First Home. The grant only works on a single-family home or duplex in Philadelphia, so if you're set on a condo, plan your down payment and closing costs without it and look at other options with your lender.