Philadelphia continues to attract wealthy homebuyers, with million-dollar home sales hit record highs in the first quarter of this year.
At least 87 homes priced at over $ 1 million were sold in the first three months of the year, according to an analysis of multiple listing service data by Drexel economist Kevin Gillen. At the same time last year, Philadelphia buyers bought 32 of these homes. In the years before the pandemic, home sales in that price range averaged 97 for the full year.
Prices across all segments of the housing market have risen over the past two years, thanks to strong buyer demand and inadequate housing supply. It’s pushing some homes over $ 1 million. The pandemic has also spurred residents to look for larger and more expensive homes.
Philadelphia also attracts buyers from more expensive cities looking for relatively affordable prices in the region when they retire or work in remote areas. Work in Philadelphia’s culture, art scene, entertainment, restaurants, places, and medical and other professions attracts wealthy buyers. Kristenfoot, a realtor who specializes in selling multi-million dollar homes as the team leader of Kristenfoot and Company at Center City’s Compass, said it was a good sign for the city.
“People are confident and want to invest here,” she said. “The value of Philadelphia is still incredible.”
And the city’s 10-year tax cut, which is used by residents of newly built millions of dollars, is “still a big driving force” and an incentive not found in other cities, she said. ..
This year, $ 1 million home sales hit a record, but over $ 1 million homes remain only a small part of Philadelphia’s real estate market.
Approximately 41% of the city’s homes sold in 2021 cost between $ 250,000 and $ 500,000, according to an analysis of sales data by the Center City district, which manages and manages the downtown area. About 38% of homes sold last year cost between $ 100,000 and $ 250,000. Approximately 2% will cost over $ 1 million.
The analysis by Center City District and Gillen does not include luxury homes or some luxury condos that are not listed in traditional multiple listing services. A Millions of dollars condo and townhouse series Most of the Center City area is nearing completion, including the 2100 Hamilton Condo near the museum, the Laurel Rittenhouse Square Condo, and the Art House Condo on the Avenue of Arts segment on South Broad Street.
In Philadelphia, the “super-luxury market” for homes over $ 3 million is also expanding, Foot said.
“In the last five years, especially now, with all this new construction, there are a lot of housing units sold in the $ 5 to $ 8 million range,” she said.
When Foote started 15 years ago, she said it was a big deal for a house that sold for $ 1.5 million in the city. For a long time, the $ 1 to $ 2 million range was Philadelphia’s high-end market, she said. Today, these homes sell quickly, and many of Foote’s clients buy and sell for over $ 4 million.
and, Rising mortgage rates You can discourage buyers in the $ 1 million range or less. They aren’t worried that buyers will pay millions of dollars in cash to their homes. Some homeowners in the ultra-luxury market lived in villas in the early days of the pandemic, but now they want to come back and settle in Philadelphia, Hoot said.
“Philadelphia has this very competitive advantage,” said Paul Levy, chairman of the Center City district, as new remote employment continues to reassess where people across the country want to live. I am. From cultural facilities to short commute times to homes that are hundreds of thousands of dollars cheaper than other East Coast cities, “we have a lot of what people want.”
For example, in New York and Washington, $ 1 million homes make up about 20% of housing stock, according to an analysis of census data from the Center City area.
Real estate market growth is healthy for Philadelphia, but faster, more comprehensive employment and wage growth, more business entry and vacant properties to allow residents to stay. Development is also required. City location.
“At this point Philadelphia has a really big opportunity,” he said.