USA Today shows that the majority of the real estate crisis is confined to just 5 states: California, Arizona, Michigan, Nevada, and Florida. Most of America is not in a foreclosure crisis. Real Estate foreclosures in Philadelphia remain low and the market fundimentals are strong.

Interest Rates are making homes more affordable

Interest rates are at 30 year lows and this allows you to buy more home for lower payments. While other parts of the country have been in a real estate slump, Philadelphia has remained a good value. This and the historically low rates make it the perfect time to buy a new home.

Advice for buyers: If you are thinking about purchasing, do it now.
Interest rates haven’t been lower for 30 years and the slowdown makes sellers eager to sell. Move quickly and keep an eye on new listings as good homes still sell in days. One good way to keep track of what’s new is to sign up for our daily email from our website.

Advice for sellers: The market is strong for those who price right.
If your house doesn’t sell in the first 60 days on the market, consider lowering your price. Good values drive buyer interest and for the first time in awhile we’ve been seeing bidding wars for houses priced right.

Contact Philly Living today to learn how we can help sell your home.

Finally, a large part of our business is via referrals. If you know someone looking to buy or sell real estate please have them contact us.

You can now download the 3rd Quarter analysis of Philadelphia real estate trends for Center City and Mainline. Philadelphia Real Estate has remained strong and shows no sign of being impacted by national trends. Overall the market is up 1% for the quarter and 3% since same time last year. Center City West largely recovered from last quarter’s dip with median sale prices up 5%. Center City East prices have remained the same.

Interesting trends are happening in the Luxury market where the number, median, and average price are all up significantly. This mini-boom in luxury properties is a good leading indicator for the market as a whole. It says great things about Philadelphia when the rich are buying property at levels we haven’t seen for some time.

Interest Rates are making homes more affordable

Interest rates are at 30 year lows and this allows you to buy more home for lower payments. While other parts of the country have been in a real estate slump, Philadelphia has remained a good value. This and the historically low rates make it the perfect time to buy a new home.

Advice for buyers: If you are thinking about purchasing, do it now. Â Interest rates haven’t been lower for 30 years. Move quickly and keep an eye on new listings as good homes sell in days. One good way to keep track of what’s new is to sign up for our daily email from our website.

Advice for sellers: The market is strong for those who price right. Â If your house doesn’t sell in the first 60 days on the market, consider lowering your price. Good values drive buyer interest and for the first time in awhile we’ve been seeing bidding wars for houses priced right. Contact Philly Living today to learn how we can help sell your home.

The American Planning Association has awarded the city of Philadelphia two honorary designations in its 2008 “Great Places in America” program.

In the “Great Neighborhoods” category, Society Hill was a winner, and South Broad Street’s Avenue of the Arts took a “Great Streets” award. Both were among 10 national recipients in each category, but Philadelphia was the only city to garner more than one prize, Jastrzab said.

The 325-year-old Society Hill neighborhood, named in honor of the Free Society of Traders, chartered in 1682 by William Penn, “provides a stimulating confluence of varying architectural styles, mixed uses, and social diversity in a downtown urban setting.”

The eight blocks of South Broad Street from City Hall to South Street, transformed during the past decade into the Avenue of the Arts, made the APA’s “Great Streets” honor roll for “its historical character, focus on the arts, social vibrancy, and public and private redevelopment efforts.” First developed in 1681, South Broad is one of the oldest planned streets in the country.

The nine other APA 2008 Great Neighborhoods are: Echo Park (Los Angeles); Greater Park Hill (Denver) ; North End (Boise, Idaho) ; Old Town Wichita (Wichita, Kan.); Downtown Salem (Salem, Mass.); Charles Village (Baltimore); Greater University Hill (Syracuse, N.Y.); Village of Mariemont (Mariemont, Ohio); and Downtown Sheridan (Sheridan, Wyo.).

The nine other APA 2008 Great Streets are: Mill Avenue in Tempe, Ariz.; Seventh Avenue in Tampa, Fla.; West Main Street in Louisville, Ky.; Commercial Street in Portland, Maine; Washington Street in Boston; Main Street in Annapolis, Md.; Summit Avenue in St. Paul, Minn.; South El Paso in El Paso, Texas; and Clarendon & Wilson Boulevards in Arlington, Va.

Given all of the media’s coverage of the negatives of the market, we’re seeing that many buyers are on the fence about whether to move forward now or wait a year and purchase then. The main argument for waiting tends to be something akin to: Prices will fall and I’ll get more for my money. Though there are good arguments on both sides, Kevin Gillen’s data seems to suggest that, at least here in Philadelphia, we shouldn’t expect much of an adjustment downward in price.

At the same time, we all know that interest rates have risen (about 1% in the last quarter) and most economic forecasts assume that they will continue to rise. So what is a buyer to do?

We’ve put together some simple numbers looking at what we believe could be reality – a 5% drop in home prices coupled with a 1% increase in interest rates. Most indicators show that 5% is probably a bit extreme, but erring on the side of caution seems prudent. So what does this all mean?

It turns out, from a financial standpoint, most buyer will save themselves money by hedging their bets against increasing interest rates rather than hoping that the market will dip. After all, most people who were hoping for a dip were not so happy to find out that Center City prices are up 1% year over year….

If you’re looking for property that hangs on to its value even when the real estate market twists and turns, a condominium in Center City may be what you seek. Two decades of sales downtown suggest that as a long-term investment, condos are remarkably bulletproof.

“Center City real estate has appreciated an average of 15 percent a year since 1985, greater than the inflation rate,” says Center City District executive director Paul Levy. “Condos aren’t something that you own for just 15 minutes. They are long-term investments with a proven record of appreciation.”

That’s consistent with the trend nationally, says Mark Zandi, chief economist for Moody’s Economy.com. “Downtown condo markets across the country have held up better than I would have expected,” he says, “given . . . demand and despite the glut of space.”

In the first quarter of 2008, data from the City Recorder of Deeds Office show, condo sales throughout Philadelphia stayed about even with the same quarter last year, at more than 500 units.

Thirty-two condos in Center City sold for $1 million or more in the first quarter, the data show. The most expensive went for $4.7 million at the Ayer on West Washington Square. For all of 2007, 115 condos sold for $1 million or more; in 2006, 49 sold. (More $1 million-plus condos are being built now, thus sales numbers for them are increasing.)

Currently, there are about 10,000 condo units in Center City, more than twice the 1990 number, because of new construction and conversion of nonresidential buildings encouraged by tax-abatement programs enacted by City Council in the late 1990s.

Hundreds of units are still in the pipeline. And despite slower sales regionally and in the city’s single-family-home market, most developers – especially those with high-rise and higher-end projects – appear to be hanging in.

Among such projects are 1706 Rittenhouse Street, 10 Rittenhouse Square, the Murano, and Residences at the Ritz-Carlton. Developer Carl Dranoff plans to break ground June 19 for 777 South Broad, a 146-unit, five-story condo building.

Not surprisingly, given the overall real estate market, some condo plans have not come to fruition. More than a dozen projects have been canceled, delayed or postponed over the last 18 months.

Newly built or not, Center City’s condos continue to draw a mix of buyers.

“You hear everyone saying this is an ideal market for first-time buyers, and it is,” says Matthew Young, 24, an engineer who has just closed on a $410,000 condo at Seventh and Bainbridge Streets.

“I was fortunate that, thanks to my savings and my family, I was able to put 60 percent down,” says Young, who searched for a month before finding what he wanted.

With 73 percent of Center City residents working downtown, Levy says, gas prices may prove as big a boost to real estate there as nightlife and cultural opportunities. “It soon may be cheaper to fly home to the edge of the suburbs,” he says.

“I didn’t want a car,” says consultant Gail S. Bowers, 46, who with her partner, Temple professor Barry Vacker, 51, has a contract on a 1,000-square-foot studio at 1352 Lofts on South Street near Broad. Prices there range from $349,000 to $1.4 million, says Kathy Conway of Prudential Fox & Roach.

Vacker, an architecture buff, wanted something built in the 20th or 21st century, and Bowers wanted a low-rise. Both wanted “fabulous space with a lot of light, and we got it,” she says.

There was a time, from 1987 to 1997, when condos in the city lost value. But data compiled by Kevin Gillen, a research fellow at Wharton and vice president of Econsult, a Philadelphia economic-forecasting service, show prices rising consistently since.

Through the fourth quarter of last year, prices appeared to be holding, or at least not falling precipitously, Gillen says. And during the first quarter of this year, which he describes as one of the slowest winters in years, condos were moving.

Prices of comparable units in older buildings show substantial gains over the last decade, without factoring in inflation. For example, a one-bedroom in Wanamaker House sold for $92,500 in 1997, and a comparable unit sold for $365,000 in 2007, according to records kept by Center City condo developer/Realtor Allan Domb.

A Society Hill Towers two-bedroom that went for $122,000 in 1997 sold for $550,000 last year. A one-bedroom in Academy House that brought $72,500 in 1997 sold for $310,000 last year.

If the 1997 prices were adjusted for inflation and condo values had been flat over those 10 years, the one-bedroom at Wanamaker House would cost $119,500 today, and the two-bedroom at Society Hill Towers $157,605.

In the first quarter, with 47 units claimed, the Arts Condominium at 13th and Locust Streets was the city’s best seller, deed records show. Of its 372 units, 371 have settled, says property manager Mary Galgon. Remaining is a $319,000 one-bedroom penthouse.

John Featherman, an agent with Prudential Fox & Roach, owns several condos at the Arts, sold about a dozen, and leased about 25 for clients.

“Where can someone have bought a studio for around $100,000 to $135,000?” Featherman asks. “The units are small and they generally have mini-kitchens, but you’ll take these units over a dorm.”

The quarter’s second-best seller was Parc Rittenhouse at 17th and Locust Streets, with 36 condos sold. Of its 260 units, 153 have closed, and 42 are set to close over the next 120 days.

Former New Jersey Superior Court Judge Steven Fluharty and his wife, Joan, have lived in their two-bedroom, two-bath unit with den at the Western Union Building at 11th and Locust Streets for about a month and are “just loving it,” he says. “Everyone said Rittenhouse [Square], but we wanted something close to everything but quieter. This was it.”

So far, just under 70 of the building’s 99 units, which go for $400,000 to $1.5 million, have sold, and more than 40 have settled, says Bruce Lang of Coldwell Banker Realty Corp., who is handling sales.

For a growing number of buyers, the Center City condo is a second home. Like Curtin and Lisa King of Northeast, Md., who in March bought a one-bedroom unit at the Winne on Front Street for about $379,000.

Both are in their 40s and are in marketing.

“My husband calls [the condo] an 800-square-foot addition to our home,” she says. “I had sold some real estate and we wanted to find a place to put the money to good use.”

They chose Philadelphia, “because the housing market is strong and healthy,” she says. “We are planning to spend a lot of time here.”

Reprinted from philly.com

By Alan J. Heavens, Inquirer Real Estate Writer

For months we’ve been telling you the Center City real estate market is stronger than you might think from listening to the news. We’ve blogged about why Philadelphia is different and told you about developers who are investing in the city. But our first quarter report provides the best proof to-date of the ongoing strength of Center City real estate.

The median price for a Center City home is $310,000 up around 13% from last quarter 13% from Q1 of last year. The average home is at a whopping $384,000 up almost 10% for the quarter. The upward trends show fundamental strength in the market and suggests market activity will increase. Buyers need to be prepared to act fast as homes will sell more quickly than 2007.

Sign up to read our full report and receive quarterly updates on the state of the market.

We’ve been arguing for months that the Philadelphia market is stronger than the press makes you believe. We were able to prove it in our market report where prices held (and even went up in certain neighborhoods)…

So we were glad to see some good news come from people other than ourselves. TIME Magazine wrote a good article about how buyers can save money by buying now and Philadelphia Magazine reiterated all of the arguments we’ve been saying here and to our clients in their most recent issue.

Earlier this month we learned of some additional good news when USA Today published numbers on the economy. it showed that while many states are in recession, Pennsylvania and Philadelphia in particular are in full Expansion. Additionally, they reveal that state wide real estate is up 2.8%.

These are all good signs for real estate. A strong economy means more buyers, fewer foreclosures, and strong market pressure to drive real estate prices higher. Houses are staying on the market for less time. If you are looking to buy, take advantage of the low interest rates and buy now!

Yet another sign of the strength of Philadelphia and Philadelphia real estate. Developers just announced they will be creating a neighborhood changing boutique hotel smack in the middle of Center City at 12th and Chestnut. No doubt this will become the anchor that attracts high end retail, restaurants, and apartment developments. Expect neighboring property values to rise and look forward to a hipper future for Philly! Get the full scoop at The Illdelph.