Real estate is a lucrative business. If you know what you’re doing, you can break into the best markets at just the right time, turning opportunities into cold hard cash. Real Estate moguls like Nick Vertucci understand that the key to real estate success is knowing the ins and outs of your market. The nuances of the real estate market in Philadelphia might surprise you.
Philly Breaks the Mold
If you’ve studied real estate for any period, you have heard how cost prohibitive big city markets often are. It’s not uncommon to see a 600 square foot apartment in New York City, for example, rent for $1,000 per month or higher. Families who choose city life over suburban living can increase their cost of living by as much as $9,000. But, according to Nick Vertucci, the tables have turned in Philadelphia, where home values in Philly suburbs have gone drastically down, while the value of Philadelphia City real estate has jumped 5% in the first part of 2017. Out of ten counties surrounding Philadelphia, nine have seen depreciation in their markets, with Montgomery County showing a mere .4% increase. This makes Philadelphia proper the perfect place to look for real estate.
What It Means
With such a value spread in such a small area, it’s not hard to see how this translates into the real world real estate market. When home prices plummet, inventory drops proportionately, as homeowners refuse to sell for under their perceived fair market value. Foreclosures increase, which, in turn, further impacts home values in the area, creating a spiraling effect. Low inventory also leads to reduced foot traffic in a neighborhood or county. Because of the drastic discrepancy between Philadephia suburbs and the city, the comparison is stark at this time. When measuring the total cost of living, including mortgages, taxes and child care, city dwellers in Philly spend as much as $14,000 less per year than their suburban counterparts.
There are several reasons why Philadelphia City real estate is experiencing such a boom. The urban lifestyle has come into its own in the past decades, with access to amenities like extensive public transport systems, entertainment venues, and jobs and businesses. This cultural renaissance has largely passed up the nearby suburban areas, leaving them disadvantaged to buyers. In addition, suburban homeowners are still recovering from the recession- until their homes are worth more than they owe, they are stuck. This makes apartments, condos and townhouses the most lucrative real estate niches in these areas. In addition, foreclosed or distressed single family homes may be ideal for buyers interested in renovating and flipping property. Still, the momentum is in the city. There is significant growth in categories like starter homes and high-end properties, so don’t overlook these niche markets. Lower prices and increased inventory mean that many renters are considering buying for the first time, while city amenities and lucrative job opportunities are drawing higher-income property growth.
Your Real Estate Expert
Understanding your market is the most important part of buying a home, whether you’re a homeowner or an investor. Nick Vertucci knows the quirks of buying and selling in areas like Philadelpia. He specializes in real estate investing, with real-world experience breaking down market nuances. If you want to make real estate investing a career, the Nick Vertucci Real Estate Academy offers hands on help, as well as a system to help you understand when and how to buy and sell. Philadelphia is a vibrant city with a booming real estate market and having the best tools in your pocket can help you turn real estate statistics into real world cash. Follow his Academy on Twitter @NVREA or follow Nick personally @NickVertucci