Toll Brothers Exploring Constructing in Rittenhouse Square
The homebuilder is reportedly in talks to buy 1911 Walnut Street with an eye toward building a condominium tower that would have a hotel and retail space. This prime parcel on Rittenhouse Square has remained undeveloped since the early 1990s and was put up back for sale in January. Interest in the parcel was expected to run high because of its size and location - it totals nearly an acre.
(Philadelphia Business Journal)
Home Prices Rise on Increased Demand, Falling Inventory
All 12 Federal Reserve districts witnessed moderate to modest economic growth as the housing market continued to improve on rising home values and more demand for a smaller inventory of homes, the Fed’s November Beige Book said yesterday. Residential real estate activity improved in most districts, with multifamily construction posting moderate to strong growth on its own. Comparatively, single-family home sales slowed on seasonal trends, while activity in nonresidential real estate remained stable or slightly improved across many districts.
Real estate activity in Philadelphia, Chicago, St. Louis, Minneapolis and San Francisco improved, while other housing markets either remained steady or softened. Most districts attributed the continued rise in home prices to increasing demand, low to declining levels of inventory and slowly rising new-home construction. However, prices are still moving at a slower pace than what was observed earlier in 2013.
Furthermore, the housing inventory of unsold homes hit a historical low in Philadelphia, Richmond, Chicago, Kansas City and Dallas. But the problem does not solely lie in a lack of houses, with Philadelphia, Cleveland, Kansas City and San Francisco builders facing a scarcity of high-skilled trade workers. According to HousingWire’s Census Bureau residential sales report released yesterday, “Rising home sales caused the nation’s housing supply to tumble from a 6.4-month inventory in September to a 4.9-month supply in October.”
As a whole, market participants expect continued improvement in the Philadelphia, Atlanta, Kansas City and Dallas districts, while contacts in Boston and Cleveland remain cautiously optimistic. Multifamily housing experienced solid growth.
Trulia’s Top 10 Most Popular Neighborhoods in Philadelphia
1. Bella Vista/ Southwark
2. Fairmount/Art Museum
5. Northern Liberties/ Fishtown
6. Center City East
7. Northeast Philadelphia
8. Northwest Philadelphia
9. Queen Village/ Pennsport
10. Point Breeze
New Home Sales Jump in October after September Drop
Sales of new homes grew 25.4% to a seasonally adjusted annual rate of 444,000, the Commerce Department said. That was the largest monthly percentage increase since May 1980. But the increase came after sales had fallen 6.6% in September to a 354,000 annual rate, the weakest since April 2012, and sales in August and July were revised lower to 379,000 and 373,000, respectively.
Sales had slowed over the summer after mortgage rates rose sharply and a limited number of homes for sale boosted prices. The combination made home-buying less affordable. New-homes sales have risen 21.6% higher for the 12 months ending in October. Still, the pace remains well below the 700,000 consistent with a healthy market.
"The report suggests sharp weakening through September and then a rebound in October, but the volatility in the data argues against putting much emphasis on a single month," said Jim O’Sullivan, chief U.S. economist for High Frequency Economics.
Prices for new homes eased in October. They fell 4.5% to $245,800 from September and have declined slightly over the past 12 months. The number of new homes available for sale was 183,000 in October. The Commerce Department delayed the release of the September sales figures because of the partial government shutdown in October.
Mortgage rates are nearly a full percentage point higher than the spring. Rates rose in May when the Federal Reserve first signaled that it might slow its $85 billion in monthly bond purchases. But rates have moderated from recent highs after the Fed decided to keep its bond buying intact. The latest average rate on a 30-year fixed mortgage was 4.29%, which is still close to historic lows.
The Longtime Owner Occupants Program (LOOP)
Mayor Nutter and City officials will announce the launch of a new real estate tax relief program for long-time homeowners. The City of Philadelphia is mailing information packets, which includes an application, to pre-selected eligible properties. Applications are due by January 15th, 2014, although Council President Darrell Clarke is working to have that deadline extended. The program will benefit lower-income homeowners who have been in their homes for at least 10 years and saw their property assessments increase by 300% or more this year. For 10 years, LOOP participants will be taxed on no more than triple their old assessments. Applicants must meet a series of requirements, including being up to date on taxes and below a certain income level. Residents can go to phila.gov/LOOP to see if they’re eligible. Up to 80,000 properties may be eligible. The city budgeted $20 million to pay for the tax breaks in this year’s budget
(City of Philadelphia)
New Art Studio Space to South Street
The Pearl Arts and Crafts building at 417 South Street will be transformed into 85 art studios and a rooftop restaurant with a sculpture garden called The South Street Arts Center. The owner wants to open the building by 2014, and the designs and plans are not final. Rent for studios will start at $250/month and go up as high as $1,500/month. Included in rent will be gallery/wall space in the planned first floor art gallery and retail space.
Eataly Coming to Philly?
The Italian food emporium founded in New York City by Mario Batali, Lidia Bastianich, and Joe Bastianich has been targeting Philadelphia. Joe Bastianich offered a confirmation in an interview with Chicago Reader, saying that an Eataly Philly is probably a year away. Renowned city chef Marc Vetri has said that the first floor of the old Strawbridge & Clothier store at Eighth and Market was on the table.
Former YWCA Annex at 20th & Chestnut to Disappear
In its place will rise a twelve-story building with 110 apartments and commercial space on the first floor. In addition, the basement will be used by the Freire Charter School, located next door. The new apartments will join the hundreds of additional units that have appeared in this area in recent years, with the recent construction of 2116 Chestnut a block to the west and the renovation of the former AAA building a block north.
Home Prices Advance in Third Quarter
The U.S. National Home Price Index rose 3.2% in the third quarter of 2013 and 11.2% over the last four quarters. In September 2013, the 10- and 20-City Composites gained 0.7% month-over-month and 13.3% year-over-year. While 13 of 20 cities posted higher year-over-year growth rates, 19 cities had lower monthly returns in September than August.
(S&P/Case-Shiller U.S. National Home Price Index)
Overall Foreclosure Numbers Are Down
According to the latest report from CoreLogic, foreclosure rates are further shrinking. Foreclosure inventory and completed foreclosures are down 33% and 39% respectively, nationally from a year earlier. As of September 2013, the foreclosure inventory comprised 2.3% of all homes with a mortgage versus 3.2% measured a year prior.
These numbers represent positive signs that the housing market continues to improve, although they stand to benefit sellers more than buyers. “As foreclosures decline, prices will begin to increase. A home will be more expensive because there will be less inventory, especially inexpensive inventory,” says John Graham, broker.
Buyers and sellers should look at more than just the foreclosure rate to get a feel for their local housing market. “Prospective buyers and sellers need a more comprehensive, detailed analysis to infer much about the specific region they work or live in,” says Cameron Findlay, chief economist for Discover Home Loans, “Given the recent home appreciation in most markets, this reduces the negative equity impact, which has allowed for more potential foreclosure candidates to work out their mortgages.”