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Philadelphia Housing Quarterly Market Update: Q1 2014

Philadelphia’s Housing Continues to Exhibit Bipolar Symptoms in 2014 Q1  by Kevin Gillen

Prices and sales continue to rise in affluent neighborhoods, but decrease or remain flat in others.

philly spring

April 14, 2014: Although it has been two years since Philadelphia house prices hit their post-recession bottom, its recovery has not only proceeded in fits and starts, but has also been unevenly—and inequitably—spread across the City’s neighborhoods. The latest stats continue to confirm this trend, indicating improved market conditions in either relatively high-income or gentrifying areas, but continued stagnation or even decline in the rest of the City. The average house value in Philadelphia declined by 4% in Q1, according to the latest data from the City’s Recorder of Deeds. However, this citywide average blends price increases in some neighborhoods with price decreases in others.

 

House prices generally increased in Philadelphia’s more affluent or revitalizing neighborhoods, but fell in most remaining parts of the City, with the poorest neighborhoods experiencing the largest declines. From smallest to largest, the average change in house prices by neighborhood in Q1 were: West Philadelphia (-17.5%), North Philadelphia (-12.9%), Kensington/Frankford (-6.1%), Upper Northeast Philadelphia (-5.9%), Lower Northeast Philadelphia (-5.7%), Northwest Philadelphia (-2.2%), South Philadelphia (+2.5%), University City (+2.7%) and Center City/Fairmount (+6.8%).

 

The median house price in Philadelphia fell to $110,000 in Q1, a 13% decrease from $127,000 in the previous quarter.

 

Home sales volume continued to increase this past quarter on a seasonally-adjusted basis, although activity remains relatively skewed towards the higher-priced vicinities of the City. There were 3,148 arms-length transactions in Q1, up from 2,849 a year ago and up from 2,503 in their post-recession low three years ago. While sales activity is trending positively, overall volume still remains below its historic average of approximately 3,800 sales per quarter. Notably, however, sales of million-dollar homes continue to run well above their historic average, providing further evidence that Philadelphia’s housing recovery remains skewed towards the upper segment of the market.

 

Although price changes remain varied across neighborhoods, this quarter’s citywide average decline has returned Philadelphia’s house price index to near its post-recession low of two years ago. Currently, the index has a value of 375.4, which is only slightly above its value of 372.0 in 2012 Q2.

 

Inventories of homes listed for sale also continued their decline in Q1. Currently, there are 6,798 homes listed for sale in the city, which is very close to the pre-bubble historic average of approximately 6,000, and down significantly from its peak of over 12,000 back in 2006. This decline in surplus inventory combined with the upward trend in sales activity should provide some optimism that supply and demand are continuing to move towards being back in balance with each other.

 

To what extent this quarter’s mixed numbers may be attributable to the adverse effects of an exceptionally cold polar vortex-induced winter is unclear. However, while some neighborhoods in Philadelphia appear to be in full resurgence, the lack of citywide price appreciation stands in marked contrast to those of most other U.S. cities.

 

According to Case-Shiller’s house price indices for the twenty largest U.S. cities, price recovery remains strong and steady in most other cities, compared to Philadelphia’s variance and unevenness. That Philadelphia’s recovery will continue in this way for the near future is supported by the most recent house price forecast from Zillow, which is projecting Philadelphia’s house prices to rise only 1.3% over the course of the next twelve months, while forecasting a 3% increase for the U.S. as a whole.

 

 

 

 

 

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Split-Levels Replacing Pain Center

Front elevation

How it will look like. Courtesy the Philadelphia Real Estate Blog.

The Philadelphia Real Estate Blog got us a first look last week at the new split-levels replacing the Pain Center at 12th and Lombard, a rather dated 1970s-era structure.

How it looks today. Courtesy Philaphilia.

Designed by ubiquitous local architects Harman Deutsch, these structures will come with a 2-car rear garage with decks on top, as well as the firm’s idiosyncratic design. We’ll have more details as and we learn about them!

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A New Restaurant For the Kimmel Center?

As reported on Plan Philly, the Art Commission has given its final approval for a proposed new restaurant facing Spruce Street in the Kimmel Center.

Designed by the KieranTimberlake firm, this restaurant will be a Jose Garces (of Amada, Tinto, Distrito, Chifa, Village Whiskey, Garces Trading Company, JG Domestic fame, and Iron Chef) venture.

Watch this site for more details as soon as they come!

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Growlers Coming to Bella Vista

The chefs behind Time and Vintage Wine, and the non-Starr part of Dandelion and El Vez, are bringing a new restaurant to the old Vesuvio at 8th and Fitzwater in Bella Vistareports Foobooz. Growlers is its name, and it puts us in a gastropub mood.

The former Vesuvio. Courtesy Foobooz.

Jerry Donahue, recent champ of Yards Brewing’s Smoke ‘Em If Yous Got ‘Em beer-and-BBQ festival, will be the kitchen mastermind behind this new idea.

As opening date moves closer, expect us to have more information!

Mmm beer-flavored barbeque…

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New Development in Hawthorne

Could we soon see activity at 714 South 11th Street in Hawthorne? Naked Philly sure seems to think so.

The site. Courtesy Naked Philly.

Appealingly close to both Bella Vista and the Italian Market, this rowhome has sat vacant for a while. Recently sited by L&I’s Doors and Windows violation, it has a new owner with a Plan: Flatten it, and put new homes here and on Jessup. Both would have roof decks and garages.

Our advice for this new development in Hawthorne: Keep the nice façade, kill the 11th street garage. We’ve seen it done elsewhere.

We’ll keep you posted on new developments!

…Oh, and 11th Street, you need more trees.

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Fante-Leon Pool Replaced by Triplex

The old swimming pool. Courtesy Naked Philly.

Gone is the old Fante-Leon Pool, once one of Bella Vista‘s premier recreation sites, and its beautiful 1920s brickwork. In its place rises, reports Naked Philly, what (according to L&I) will be a triplex.

New…and green! (Literally.) Courtesy Naked Philly.

Shame about the façade, but may we recommend its location? Just off the Italian Market, the single most awesome business district in a city stuffed with awesome business districts, chock full of fresh, delicious, local produce, meats, and cheeses. And we couldn’t forget about all that excellent Vietnamese food down on Washington! Mmmm food heaven…

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The Problem With Triangle Park

Triangle Park in better days. Courtesy Naked Philly.

Bella Vista’s Triangle Park, at the intersection of 6th and Christian Streets and Passyunk Avenue, is a small, beautiful plot of green in a neighborhood boasting several small, beautiful plots of green. It, however, also sits satisfyingly right in the middle of the neighborhood, surrounded by beautiful houses, cafés, and other small business.

Oh, and it’s privately owned.

That’s why the owner fenced it in earlier this summer, in an “attempt to signal its availability”, despite its half-decade of cheerful local use, much to the displeasure of the neighborhood–a neighborhood which has been working to acquire the parcel so it can stay a park ever and anon…

The overgrown site. Courtesy Naked Philly

But wait, there’s more! According to this Naked Philly piece, the parcel was a gas station before the community covered it with greenery. And gas station sites tend to have nasty underground surprises, particularly for verdanture atop. Environmental sampling and (likely) remediation has to be done before the property can be conveyed, which has to happen before the fencing can come down–remediation which would also destroy the landscaping already in place.

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