According to a recent article in the Inquirer, Philadelphia is uniquely poised to withstand potential downturns in the housing market.
- Some basic stats: home prices over the last seven years have increased 46% in Philly. The Inquirer states there were 5,500 zoning and building permits issued in Philly in August, down from a 12 year high of 6,010 permits issued in May. Sales in Philly declined 15.4% but are still historically high.
- Philly’s housing market is less volatile than other metro markets. Our market does not rise as high during boom times and when the market falters, we tend not to crash as hard making recovery that much easier. According to Drexel’s economist Kevin Gillen, during the recession years of 2007-2012, housing prices in Las Vegas fell 62%, DC’s declined 33%, and Philly’s only 20%. A house in 1999 in Philly was worth $200,000, today it is worth $526,000. In Las Vegas that same $200,000 house in 1999 is worth less than $400,000 today.
- Overall the housing market is much healthier than it was at the onset of the recession in 2007. Lenders are giving mortgages to less risky customers and federal agencies are more vigilant in monitoring the markets.
- The housing industry is a major player in the economic health of the region: population has grown; jobs have increased: personal incomes have risen; neighborhood blight has decreased (6,000 vacant lots vanished in the last seven years); and people are investing in the region.