econsult solutions, inc. real estate value trends philadelphia

ECONSULT SOLUTIONS, INC.

REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1

TABLE OF CONTENTS Quarterly Index ...................................... Sales by Price per Square Foot ............. Sales Volume by Price Range ............... Statistics by District.................................. Quarterly Index by Subregion ............... Focus on: South ................................... Background and Notes.......................... Price per Square Foot Low

High

Econsult Solutions, Inc. | 1435 Walnut Street, Ste. 300 | Philadelphia, PA 19102 215-717-2777 | econsultsolutions.com

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ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 QUARTERLY INDEX

Index Number of Sales Average Sale Price Quarterly Change

152.5 2,928 $112,500 +2.3%

Philadelphia and Comparative House Price Indices 2003 – 2013 Q1 (2003 = 100) 210

190

170

150

130

110

90

2003

2004

2005

Philadelphia

2006

2007

2008

2009

Philadelphia Metro Area

Quality-adjusted price of single-family houses in Philadelphia increased by an average of 2.3 percent this quarter and are also up 5.6 percent from a year ago, signaling a mild reversal of the weak market from the previous two quarters. Overall, there were 2,928 arms-length sales of single family homes this quarter. This is down 7 percent from the previous quarter, but still up 11 percent from the same quarter a year ago.

2010

2011

2012

2013

National Average

Index Percent Change, 2008 -2013 Q1 10% 5% 0% -5% -10%


2008

2009

2010

2011

2012

2013

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ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 SALES BY PRICE PER SQUARE FOOT

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Each dot on the map represents one sale. The color indicates the price per square foot, following the classification shown on the chart below.

Count of Sales by Price per Square Foot 498

$25 or Less

400

$26 to $50

808

$51 to $100

619

$101 to $150

Median price per square foot was $87. There were 295 sales in the most expensive category with prices over $200 per square foot, and 498 in the least expensive category of $25 per square foot or less.

$150 to $200

293

More than $200

295

Median Price Per Square Foot Number of Sales


$87 2,928

ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 SALES VOLUME BY PRICE RANGE

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Volume of Sales by Price Range Price Range

2013 Q1

$25,000 or less

405

$25,001 - $50,000

340

$50,001 - $100,000

601

$100,001 - $150,000

524

$150,001 - $200,000

381

$200,001 - $300,000

350

$300,001 - $500,000

233

$500,001 - $750,000

62

$750,001 - $999,999

12

$1,000,000 or More

20

Total

2,928

Volume of home sales was down slightly this quarter (to 2,928 from 3,164 last quarter), but remained at a level consistent with the past few years of transactions. The number of home sales with values of more than $1 million was also lower this quarter (21 compared to 33 in 2012 Q4). The median sale price of $112,500 represents a 6.3 percent decrease over the previous quarter, but is up 12.5 percent over the same quarter one year ago. Unlike the index value, the median price is not quality or seasonally adjusted. Median Sales Price (thousands) $150 $125 $100 $75 $50

$112.5 2003

2006

2009

2012

9,000

40

8,000

35

7,000

30

6,000

25

5,000

20

4,000

15

3,000 2,000

10

1,000

5

0

2003

2006

Total Sales

2009

Sales $1 Million or More


2012

0

Sales $1 Million or More

Total Sales

Total Sales Volume and Volume of Sales Greater than $1 Million

ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 STATISTICS BY DISTRICT

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Index

Sales

Median Sale Price

Quarterly Change

Annual Change

1 Upper Far Northeast

126.4

91

$209,900

0.40%

-2.71%

2 Lower Far Northeast

145.9

126

$168,000

-1.90%

-4.14%

3 Central Northeast

135.2

147

$150,000

-0.95%

-1%

4 North Delaware

114.8

224

$100,000

-3.18%

-8.26%

5 Upper Northwest

150.5

154

$130,000

-1.79%

-0.48%

6 Upper North

158.6

199

$68,799

-6.09%

-7.73%

7 Lower Northeast

128.8

192

$69,900

-2.38%

-4.11%

8 Lower Northwest

149.0

136

$208,000

0.43%

1.80%

9 North

132.8

199

$23,800

-6.56%

-4.32%

10 River Wards

207.9

241

$85,000

0.91%

6.48%

11 West Park

184.7

54

$112,500

-1.04%

6.11%

12 Lower North

211.2

147

$55,000

5.61%

16.56%

95.3

219

$33,300

-2.85%

3.22%

14 University*

219.7

40

$230,000

-6.65%

2.23%

15 Central

148.5

231

$385,000

0.58%

5.89%

16 Lower Southwest

168.1

66

$59,053

0.63%

-1.12%

17 South*

242.3

462

$125,693

1.36%

13.40%

X Citywide

152.5

2,928

$112,500

2.30%

5.60%

District

13 West/Southwest*

*Districts are identical to Philadelphia City Planning Districts except where noted with an asterisk. See Definitions and Notes on page 7 for details.


ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 QUARTERLY INDEX BY SUBREGION

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Subregion House Price Indices 2000 – 2013 Q1 (2003 = 100) 270 250 230 210 190 170 150 130 110 90

2003

2004

2005

Far Northeast Northwest West/Southwest

2006

2007

2008

2009

Northeast Lower North/River South

2010

2011

2012

North Central/University Citywide

Analysis at the District level provides a refined view of housing market trends. Here, these are aggregated into Subregions to summarize broader market trends. House prices in the South Subregion continued their positive trend, growing 1.4 percent this quarter and 13.4 percent for the year. The North Subregion experienced the largest decline, with prices down 6.3 percent for the quarter, and down 6.0 percent from a year ago.


2013

Color of Subregion on chart corresponds to color of Subregions on map.

ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 FOCUS ON: SOUTH The South District is bordered by Washington Ave and Christian Street to the north, city limits to the south, and the Delaware and Schuylkill Rivers to the east and west. The district includes large swaths of industrial land along the rivers, as well as very dense low-rise residential development, primarily north of Oregon Avenue. One notable characteristic is that homeowners, on average, have longer tenures of ownership than in the Central District to the north, as shown in the map to the right.

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Residential Area of South District

House prices in the District fell 6.0 percent from the housing market peak in 2007, and have recovered 5.5 percent from the 2011 trough. The housing bubble’s effect was minimal in this area in terms of prices. As early as 2010, prices reached a new peak that was 1.2 percent higher than prices during the 2004-2007 bubble. In 2012, the market trough was 7.2 percent below the trough that followed the national housing South District Facts bubble. Population Population Density in Person per Square Mile (Population-Weighted)

132,690 30,974

Percent over 25 Years of Age with a Bachelor’s Degree or Higher

19.3%

Percent of Commuters That Take Mass Transit to Work

29.2%

Average Household Income

$47,927

Number of Housing Units

61,939

Number of Single Family Homes

49,329

Average Home Value Average Length of Ownership (years)

$143,600 15

District Housing Market Peak

2007 Q3

Percent Change from Peak

-6.0%

District Housing Market Trough

2009 Q2

Percent Change from Trough

+5.2%

Sources: US Census (2011), OPA (2012), Econsult Solutions (2013) Econsult Solutions, Inc. | 1435 Walnut Street, Ste. 300 | Philadelphia, PA 19102 215-717-2777 | econsultsolutions.com

ECONSULT SOLUTIONS, INC. REAL ESTATE VALUE TRENDS PHILADELPHIA - 2013 Q1 BACKGROUND AND NOTES

Background and Contact Econsult Solutions, Inc. provides the Real Estate Value Trends free of charge to the public. Thanks to Azavea and the Office of Property Assessment for providing some of the data used in our analysis. Sales are arms-length transactions of single-family homes only. The price indexes are estimated by Econsult Solutions, Inc. using a quality controlled measure of average sale appreciation using hedonic regression analysis. Questions and press inquiries should be directed to Econsult Solutions, Inc. President Richard P. Voith at [email protected]

Notes Cover: Map displays interpolated (inverse-distance weighted) cost surface based on price per square foot of sales. Lower values of price per square foot are deep blue; higher values are red; yellow and green shades are in the middle. The image is provided for illustrative purposes only and does not represent predictions of home values. Page 1: National and Philadelphia Metro Indexes are from the Seasonally Adjusted Purchase Only Series from the Federal Housing Finance Agency. Philadelphia Metro refers to the Pennsylvania Division of the Metropolitan Statistical Area, which includes the Philadelphia, Bucks, Chester, Delaware, and Montgomery counties. Page 4: Econsult Solutions, Inc. Districts are identical to those used by the Philadelphia City Planning Commission (PCPC) except: PCPC’s “Lower South” is included in “South”; University City is carved out from PCPC’s “University/SouthWest”, and the remaining Southwest is combined with West to form “West/Southwest”.

Page 5: For ease of presentation, Districts are further aggregated into “Subregions,” as shown on the map. Page 6: The reported population density is weighted by population at the tract level. This measure averages out differences between the tracts based on where people live and more accurately reflects the density experienced by the average resident. The formula, as defined by the US Census Bureau, is D=Σ(Pidi)/Σpi, where D is the population density, and Pi and di are the population and density of the ith census tract. Pages 7 and 8: District and Subregion indexes are smoothed to reduce volatility and capture underlying market trends. The smoothing means that overall district and subregion prices tend to reflect overall citywide price changes with a slight lag.


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