Philly’s housing market is on track to have its best year yet since the housing boom, according to a new report.
Drexel’s Lindy Institute released its latest housing report for the third quarter and found that while appreciation of city housing prices slowed a bit from the second quarter, sales of million-dollar homes hit a record high and the city’s house price gains are outpacing the rest of the country.
“These recent gains have generally erased the losses in house values that were incurred during the recession, thus freeing many negative equity households who were virtual prisoners in their homes to re-enter the market,” Kevin Gillen, Ph.D., wrote in his report.
Specifically, the median price of homes in Philly is now $149,000. That’s almost 13 percent higher than last year. House prices continued to increase in most neighborhoods this quarter, especially in University City where they jumped 18 percent. That’s similar to last quarter, when the same neighborhood experienced the highest jump in housing prices.
Adding to the housing market’s stellar performance, a record-breaking number of homes sold for $1 million or more this past quarter, more than ever since 1997.
Philly’s housing market is still, however, more affordable than other cities. But it is becoming increasingly unaffordable due to lack of inventory, writes Gillen, and its housing market is currently out-performing all other major cities included in what’s called the Case-Shiller 10-city composite index.
Gillen writes, “By the end of this year, Philadelphia will likely have experienced double-digit price growth, while annual house price growth in these 10 other comparable cities is currently running at less than 5 percent.”
All this to say, that if the momentum continues, 2016 will best the best year for Philly’s housing market yet. But it may be increasingly tough for folks to be able to afford it.
- Philadelphia 3rd Quarter Housing Report [Lindy Institute]