What's behind the new construction boom in Philadelphia?
There are a glut of existing properties on the market. This begs the question, why are builders tearing down buildings and putting up new ones? Some of the reasons may appear obvious, but there are others which someone less familiar with Philadelphia may miss.
One of the downsides of an older home, as many homeowners are aware, are constant repair costs. Painting, plumbing, electrical, heating, drywall, brickwork, and roof repair are all parts of a home that must receive constant attention especially once a home becomes older. A buyer of an older home has to face these additional maintenance costs which hopefully will be addressed by price adjustments once the home inspection is complete, but not necessarily. Additional unexpected costs may appear that even the home inspector missed or did not become problems until a few years down the line. On the more extreme end, decades of urban blight, the loss of industry, and high unemployment have taken their toll on Philadelphia housing. Many Philadelphia homes have fallen into disrepair from which their owners were unable to recover.
Another reason buyers may prefer new construction properties is style. Home designers know that typically fashions change about every 10 years. For long time owners who aren't planning to sell their homes changing styles aren't usually a concern. However, the new buyers in Philadelphia's market are looking for a metropolitan hub, a center of more worldly experience providing a more toned-down urbanity than, say, New York offers. In that case cabinets from the '70s and the lack of a dishwasher just won't cut it.
A third reason for the construction boom is price, the obsession of every buyer, seller, and housing industry business person. On the seller and business person's end there is obviously a search for the highest price the buyers can afford. On the buyers end, with the quickly climbing prices in many areas such as Fishtown, Northern Liberties, Templetown, Kensington, and Point Breeze, buyers are coming to expect more. If you are planning on selling an older home for $250,000-$350,000, you start to crossover at the upper end with the cost of a brand-new home with all the fixins. New construction provides sellers with the potential for higher prices. Fourth is space. Real estate agents not so familiar with Philadelphia may underestimate cost per square foot because of their familiarity with the suburbs. Many older Philadelphia homes average around 900 ft.² and while many long-term residents have adapted to that size, new residents are looking for more. With backyards in short supply interior space, including building skyward is a viable alternative.
Fifth, residential communities are another reason for the growth of new construction. As much as it is the bane of anti-gentrifiers buildings like condos and co-ops with common living areas and private spaces set aside for residents provide a way to include some people and leave out others. If you are a condo or co-op owner common living areas, pools, gyms, private parking, and anything with restricted access provide a way to bring together people in similar income brackets. The well-publicized controversies in neighborhoods like point breeze regarding gentrification are really just an issue of what the characteristics of the neighborhood will be. While longtime and new residents both want their interests met, private common spaces in the city are less frequently found in developing neighborhoods. New construction condos and co-ops replace turn-of-the-century row homes with privately-gated patio areas, parking, and roof decks. Private common areas create neighbors where otherwise it could take years and even decades for any sense of neighborliness to develop.
Sixth, parking, parking, parking. While the city has become more bike friendly, there is public transportation available, and taxis and uber fill in the gaps, finding a place to park when you drive can still be a challenge. To answer the need for more parking at least higher-end properties in neighborhoods like Northern liberties are including parking in their construction plans. But until and unless there are other solutions to our city's motor lust there will be an incentive to add as much additional parking space as possible, meaning replacing 50 or 100 year old properties which stand there now.
Author:Brigit Brust Phone: 267-235-7516 Dated: August 25th 2015 Views: 1,087 About Brigit: ...
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