Fall Q3 2020 Real Estate News and Market Reports

Home Office Demands

Telling the story of the current Main Line and Center City real estate market for Q3 2020 is not a simple task. At this particular time, we have a dramatic real-life example of how there are multiple “realities” depending on what numbers we view in which market segments.

Oversimplified reports can lead to bad decisions, especially during challenging times. No one wants to hear “it’s complicated” when dating – or when buying or selling real estate. However, that is the case in the Greater Philadelphia area for Q3 2020.

Now more than ever, it’s important to have detailed information for your particular situation as reported in my Fall 2020 Newsletter.

Fall 2020 Newsletter for Main Line and Center City

In fact, what started out to be my normal market update turned into various reports covering luxury markets in Gladwyne, Villanova and Bryn Mawr on the Main Line, Rittenhouse Square and Mid-Town in Center City as well as the dramatic spike in pre-foreclosure distressed properties.

This is a unique point in time where each of these market segments has been impacted by our national COVID pandemic, political uncertainties and national news coverage of protests and violence in Center City.

Q3 2020 Market Report Summary

Philadelphia broke records in September for number of sales and median sales price primarily driven by a spike in activity after our COVID shut down during Q2.

Philadelphia Market Report

While these results can make an amazing story, it’s not clear that this is a sustainable trend. However, the steady demand and consumer confidence during challenging times speaks well for the stability of the Philadelphia real estate market.

Main Line and Center City Luxury

Luxury Market trends on the Main Line and in Center City are best viewed by year-over-year changes. Smaller number of sales at high values can skew statistical shifts month-over-month.

The biggest Q3 2020 shifts are reflected in Gladwyne luxury market with a decrease from an average of 10 months of inventory to 3 months, and a 26.59% increase in median sales price over the past 12 months.

Gladwyn Luxury Market Report

Other Main Line luxury markets such as Villanova and Bryn Mawr remain in high demand with low inventory. However, the shift isn’t as dramatic because these areas were in high demand pre-COVID due to easy access to shopping, dining and regional rail commuting stations.

Conversely the Rittenhouse Square and Mid-Town luxury markets softened to approximately 16 months from an average of 9 months of inventory. Both of these luxury market segments are largely driven by luxury condo sales such as Two Liberty and The Residences at Ritz-Carlton located in the center of the civil protests during the summer.

Does that mean that Center City luxury is dying? Not at all. Life on Rittenhouse Square is thriving.

Demand for mid-sized cities like Philadelphia within an easy commute to New York and Washington DC make Center City a prime destination for relocating buyers and commuting executives.

Gary Vee predicts we are going 100% into a mixed office environment with a standard for work from home with occasional office visits.

This lasting trend will help support the recovery of Center City.

Pre-Foreclosure Spike

The pre-foreclosure market segment has cross-currents as well. Misinformation from forbearance reporting errors adds to the increase in delinquencies. Although this spike cannot be ignored, it may not be what it seems.

Spike in 2020 Foreclosures

Mortgage crisis vs. COVID

News and analysts typically dismiss the increase in pre-foreclosures as not being the same as the mortgage crisis, citing the strong possibility of forbearances being extended into 2021.

Will forbearances be extended? Most likely. That may only postpone foreclosures if home owners remain in financial difficulty and are unable to bring their mortgage current.

The distressed property market today is not like 2009. An abundance of forbearances is indeed a different scenario than bad loans. However, a different cause doesn’t negate the results. Much hinges on our economic recovery, and home owners ability to convert their forbearance into a loan deferral.

Like other market segments, there are many layers to this “story” and it’s a trend we need to watch.

How’s the real estate market?

A quote I heard years ago applies now more than ever;

“Asking how’s the real estate market from a national perspective is like asking what’s the temperature in America”

There is technically a temperature for the United States, if you average all the temperatures across the country. However, that won’t help you plan your day or know if you need snow boots or an umbrella.

Similarly, if you ask me how’s the real estate market in the greater Philadelphia area, the answer is “it’s complicated.”

As I reported 10 years ago from Kauai’s luxury second home market, it’s a bit like quantum physics. Multiple realties for various market segments. At this point in time in the Philadelphia area, that’s especially true.

Although real estate shifts are normal, this is a very dynamic time, unlike any other real estate market shift we’ve experienced. The question that’s most important is how to best navigate these changing currents for your success.

What’s the future look like?

Both negative and positive Q3 shifts can be attributed to the impact of COVID and political unrest. What can we expect for the coming months?

No one has a crystal ball to predict the future or how sustainable these trends may be. Even the exodus of New Yorkers to large suburban homes may shift to more of a cosmopolitan lifestyle in Center City communities like Queen Village where you have the best of suburban and urban living.

Dr. Lawrence Yun, chief economist for the National Association of Realtors, recently predicted “it will be one of the best winter sales years ever.” Of course, that’s a national generalization. I certainly hope that holds true. However, now is not a time to passively wait and see. It’s a time to apply smart, creative strategies in your particular market to create success for you.

What are your real estate goals?

What’s most important is how we can maximize on current trends to meet your particular short-term and long-term real estate goals.

I’m passionate about supporting my clients with information and concierge, VIP support. As detailed as these market reports are – nothing compares to a personalized analysis for your particular goals.

Let’s talk! Please book a call or Zoom chat on my calendar or feel free to comment below. Your information will remain confidential.

From New York to the Suburbs of Philly

Moving from New York

Have you heard about the exodus from dense urban centers like Manhattan to the suburbs?

There’s been a lot of press covering home buyer demand moving from dense urban areas to more open suburban lifestyles across the country, from San Francisco to New York.

Gary Vee recently posted about how changing work from home trends are going to dramatically impact real estate, now and into the future:

Yes we can contribute this rush to the suburbs as a post-COVID market impact. However, the effect of COVID-19 on the housing market is complex. Much like the ocean, there are trends that appear like a big wave – but there’s also cross-currents and potential undertows.

Okay, you can tell I lived by the ocean for a very long time! I still take my shoes off when I come home 😎🏄🏼‍♂️

Fleeing Manhattan to the suburbs

One of the big waves that got a lot of press is the huge uptick in demand for suburban living from Manhattan. The NY Times reported in August New Yorkers are fleeing to the suburbs; the demand is insane’ :

“Moving companies have said they cannot keep up with the demand. Metropolis Moving in Brooklyn said the number of quotes for out-of-state moves jumped by more than 200 percent in May and in June.”

Moving from Manhattan to Suburbs

Most of the press highlighted an increase in demand for suburban areas close to Manhattan like Northern New Jersey. However, here in the “6th borough” of Philadelphia, we’ve welcomed a lot of New Yorkers as new neighbors on the Main Line and in Center City.

Main Line suburban living

While a large Main Line 6,000+ sf estate home on 3-5 acres sounds ideal after quarantine with multiple generations all working / schooling from home, the reality of remote large estate living isn’t for everyone.

What sounds good at first can settle into a different set of frustrations, such as upkeep and maintenance. Reminds me of my clients on Kauai who visualized a 5 acre home, only to realize in Hawaii 5 acres is like managing a farm! The lifestyle they desired was in reality better met with a home on a 1/2 acre parcel.

Family fun in Center City

Many people moving from dense urban areas crave more space but still long for a cosmopolitan lifestyle that can be comfortable and safe for the entire family.

The Main Line is comprised of townships which started as villages, and they retain quaint character along with rich history. However, in the heart of Center City there’s a village that offers the best of both worlds.

Queen Village – cosmopolitan, historic and friendly

Philadelphia’s first neighborhood and rich in history, today Queen Village simmers with modern energy, making it an ideal neighborhood if you love fashion, food and fun but want a low-key local village lifestyle.

Hear first hand insights from my Queen Village clients who love the charming, safe, friendly, village lifestyle with cosmopolitan amenities:

Two “suburban” features that are the hardest to find in Center City are a large, fenced yard and 2-car garage.

You’ll find both at 814 S Swanson, the perfect Queen Village luxury home that offers a large fenced yard, 3 outdoor decks, 2-car garage, elevator, home office and in-law suite:

Time will tell if our new friends from New York settle into the large homes on the Main Line for good, or perhaps desire a more cosmopolitan lifestyle and shift towards a different kind of quiet village community with cosmopolitan, funky vibes such as Queen Village.

Please be sure to subscribe for future updates and comment below with your thoughts and insights.

Main Line mid-century modern elegance

I had to ask myself why I love Main Line mid-century modern so much, then I started laughing because I realized I am mid-century modern! 😆

This week’s #FeatureFriday spotlight shines on a renovated mid-century gem located in Gladwyne at 1639 Monk Road designed by Kjell Ingebrigtsen and on the market for the first time after a major renovation. Tell me you don’t love this! 💕

Mid-Century elegance offered for the first time after renovation – 1639 Monk Road

I actually grew up in Victorian gems with wrap around porches, hardwood floors, back stairs to the kitchen and all kinds of fun nooks and cranny’s to play hide and seek. Homes like 227 Lansdowne Ave in the heart of South Wayne Historic District steal my heart too! 🥰

Renovated Victorian on the Main Line in the heart of South Wayne Historic District
Just Listed in the heart of South Wayne Historic District. Click for details

Many times my buyers have conflicting loves as well. One likes historic, the other adores modern.

A great solution for both is a renovated home with modern amenities but historic architectural features like my clients’ recent purchase of their “forever home” at 356 Meadow Lane in Merion Station:

To learn more about Main Line mid-century design, Main Line School Night is offering Inspiring Architecture: Mid-Century Modern online in October, taught by William Gustafson FAIA, Senior Principal Ballinger Architects & Engineers.

For easy access to all the best homes on the Main Line;

What your favorite architectural style? Comment below and share!

COVID-19 ignites Gladwyne luxury real estate market

Gladwyne luxury homes

What effect has COVID-19 had on Main Line real estate values? Today’s current market uptick can be easily attributed to pent-up demand combined with very little inventory and low interest rates.

However, a very different dynamic in Gladwyne luxury real estate has caused a significant increase in median sales price, and decrease in days on market.

The effects of COVID-19 luxury buyer demands for large, flexible homes with privacy and pools has literally flipped the Gladwyne luxury market.

Local news and statistical reports haven’t really told the story of what’s happening in Gladwyne luxury real estate. As always with statistics, results vary depending on what you’re looking at and how you’re analyzing data.

Gladwyne real estate market statitics

Maybe it’s the times, but conflicting reports on the coronavirus, the election, the economy and also real estate can be a bit much!

Quantum physics of market data

Reviewing statistics reminds me of the metaphysical, quantum physics concept that reality changes when observed. Or that one’s observation can change reality.

Especially in the luxury real estate market where one or two large sales in a small community skew results.

However, recent trends in Gladwyne are consistent and dramatic. Enough esoteric wanderings, let’s get to some understandable facts!

Gladwyne Luxury Real Estate

There are really 3 different market segments within any local area that includes luxury real estate; under $1M, $1M to $2.5M and above $2.5M. For this report, we are looking specifically at the $1M+ residential market.

Looking at the $1M+ and especially the $2.5M+ market in Gladwyne, a dramatic shift has happened.

As recently as 6 months ago, walkable locations on the Main Line, such as Wayne, Lower Merion, and Bryn Mawr were preferred by luxury buyers over large Gladwyne estate homes. Maintenance of pools, large 6+ bedroom homes with acreage that require ongoing maintenance were often deal killers. Buyers wanted easy access to transportation and shopping.

Gladwyne has become a desired location for newly mobile executives. The impact of migration from Manhattan to the Main Line along with demand from other areas such as Washington, DC has ignited Gladwyne luxury market values.

Buyers want expansive, flexible space, pools and tennis courts on a gracious private lot. A home that can function for the entire family, work from home and offers resort-style amenities.

Now the qualities that were seen as negative are competitive “must haves” for today’s buyers.

Let’s review the numbers. There’s clearly a dramatic increase in market values as detailed in this month’s Gladwyne Luxury Report:

As noted above, depending on how you analyze statistics, you might miss this story!

If you look at “absorption rates” the Gladwyne luxury inventory has been running at a 5-6 months which normally indicates a balanced market. That doesn’t reflect the hot luxury buyer activity going on right now, or the clear increase in median sales prices.

Greater Philadelphia Area Statistics

No one analyzes local data better than Drexel University economist Kevin Gillan. However as an example of how confusing statistics can be, a recent Philadelphia Inquirer article sourced Gillan :

“While home prices rose in Philadelphia in the second quarter of the year, prices of homes in the suburbs dipped.”

The “suburbs” includes several counties, and many communities. Again, it depends on what data you’re analyzing. Statistics really are only meaningful when looking at micro-market trends – what’s exactly happening in your local market.

The Bryn Mawr market snapshot below shows an example of the upward trends in Montgomery County:

Bryn Mawr Market Stats
Montgomery County median sales price $900K, up 33% over past 24 months

Contrary to Gillan’s analysis, Rittenhouse Square results from the exact same set of data shows a decline in median sales prices:

Rittenhouse Square median sales price dropped to $400K, down 27% over past 24 months

For insights into market trends in your area, contact Susanna for a private confidential consultation.

Dive deep into data detailed below, and please share your insights in the comments. Be sure to subscribe to receive future blog posts.

Detailed Market Reports

Gladwyne Luxury Market Report

Bryn Mawr Market Report

Villanova Market Report

Rittenhouse Square Market Report

Montgomery County Industry Watch Q2

Delaware County Industry Watch Q2

All data used by Gillan and in the reports above come from the same source, our local Bright MLS.

Open House signs antique? like typewriters?

After returning to an “open” business environment after three months, the future of Open Houses seems to be bordering extinct. Or more accurately obsolete, like the typewriter.

Can you write with a typewriter? Yes, but why would you? Can you have an Open House? Yes, but with all the restrictions necessary and appointments required, why would you want to go?

Open House Pivot

Pivot is a word often used to express the dramatic and rapid changes impacting the real estate market due to COVID19. Some changes were underway but became accelerated, like virtual selling.

Others, like Open Houses, have completely “pivoted” to something other than what they were.

The non-committal and casual nature of Open Houses was a way to explore local real estate without an agent, or appointment.

Virtual Open Houses were a work around during our COVID19 shut down, using video previously taken or with the owner’s cooperation via Zoom video conference.

The new standard is to present a virtual Open House on Zoom with the agent guiding a tour of previously recorded video or navigating the Matterport 3D layout. Appointments are required, and if you “stop in” late you miss the video tour.

While it’s better than nothing, and a way to get a “peak” at the interior of the home, it’s not the casual easy way to explore real estate that we have enjoyed for so long.

Virtual Selling – the new standard of practice

In today’s market, virtual selling should be a standard of practice. I’ve sold homes virtually using video since 2008. It doesn’t make sense to book an appointment for a video tour that I already have access to, or should.

Every listing should provide a video tour. For my sellers I do a marketing video, think of it like a movie trailer;

Then I do the actual walk through video which takes you through the home as if you are there.

The home buying process has “pivoted.” Home buyers used to wait to interview and hire an agent until they were ready to buy. Now it’s best practice to do that at the beginning of your search.

Likewise, your pre-approval is needed early in the process as it’s required along with a COVID19 form to book showings.

Open House Standards Due to COVID19

Now that physical Open Houses are allowed, understandably there are awkward restrictions. As an example, here are highlights of a current brokerage’s Open House guideline for agents;

1. Sales associates and all open house visitors must wear a mask.
2. Social distancing rules should be maintained.
3. Disinfect all high-touch areas prior to and between each group of visitors; provide hand sanitizer if possible.
4. Sales associates should limit open house attendance to one group at a time to maintain appropriate distancing and accompany them through their tour to minimize unintended touching of surfaces. Additional groups can be asked to wait outside and to maintain social distancing while doing so.
5. Maintain a record of everyone entering the property, including name and E-mail address or cell phone number.

COVID19 is “here to stay” – we must adapt

The Economist recently published – COVID 19 is here to stay. People will have to adapt :

“The worst is to come. Based on research in 84 countries, a team at the Massachusetts Institute of Technology reckons that…without a medical breakthrough, the total number of cases will climb to 200m-600m by spring 2021.”

We cannot just return to “business as usual” as the battle against this pandemic is far from over.

Protecting buyers and sellers from unnecessary public exposure and utilizing current technology to present a virtual buying experience is now a necessary standard of practice – not just an option.

While our local market is now pushed to pivot in this direction, it’s long overdue in terms of providing the highest level of service to our clients.

Home buying is a journey – not a transaction

I provide information, support, advise and guidance from early exploration of the market through negotiations and closing as my personal standard of practice. Sometimes the answer is to not buy, which is perfectly fine. It’s all about what’s best for you!

The rush to provide virtual Open Houses has been a push to generate “leads” or meet prospective buyers. Open Houses have always been more of a networking opportunity for the agent than a true selling tool for the home owner. Virtual Open Houses provide marketing exposure for the agent but present an awkward experience for buyers.

Virtual Home Buying Service

Using virtual selling expertise, I create video walk throughs of properties throughout the home buying process to narrow down selections and fine tune the home search for my clients. That way, the showings we book in person are in reality 2nd showings. This saves time, protects home buyers and sellers from unnecessary exposure and streamlines the home buying process.

Open House Signs – an antique?

When I sold luxury real estate on Kauai, my open house signs were often stolen and used for fighting rooster sheds, an illegal but popular local sport.

One way of repurposing them but not a big demand on the Main Line!

While I haven’t thrown my Open House signs away, they are in the back closet for now! My ‘go bag’ is full of video equipment instead.

Manhattan to the Main Line

From Manhattan to Philly

While the migration of New Yorkers to Philadelphia is not new, post COVID-19 we are seeing some interesting shifts in demographics. The New York Times recently reported on Where New Yorkers Moved to Escape the Coronavirus.

Why Philly?

In 2018 The New York Times article, Leaving New York to find the American Dream in Philadelphia, highlights a migration of artisans, chefs, immigrants and business owners to Philly from New York. All with a dream in mind.

Passive Certified Stables
Settlement Day at The Stables – 2013

As an example, learn first hand “Why Philly” from my clients who purchased the first PASSIVE-Certified luxury home at THE STABLES in Northern Liberties in 2014.

They were originally looking at traditional offerings in Society Hill, but were fascinated with this more creative, cutting edge option.

Seven years ago, my clients moved from Manhattan to Northern Liberties where they purchased the first PASSIVE-Certified luxury townhomes in Philly

Center City Luxury

Prior to COVID-19, the largest demand in Philly from Manhattan luxury buyers was for Center City with easy access to Amtrak’s 30th St Station.

Now it’s the Main Line

Remote luxury homes on the Main Line in areas like Gladwyne and Bryn Mawr are seeing a huge uptick in demand from Manhattan buyers.

While once the top criteria for Main Line buyers was “walkability” to train stations and shopping, post COVID-19 buyers want privacy, acreage, and flexible living space. For more details check out “Top 5 new features to sell your home post COVID-19.”

As an example, I had the honor of helping my Manhattan clients purchase this luxury Merion Station home during the COVID-19 shut down.

Another successful Manhattan to Main Line relocation

“Susanna is a total gem. We started looking for homes in early 2020. We had not yet found an agent, but struck up a conversation with her at an open house.

My husband and I immediately noticed how real she was: she was truthful and did not try to “sell’ us, either on the home or on her as an agent. As a result, we asked her to represent us.

Throughout the process, she was incredible: she educated us about the different neighborhoods, prepared fact books for each weekend that we looked for homes, and made sure she never wasted our time showing us homes that were not a fit.

At the end of the process, we found the perfect place. I can honestly say, it was all because of her. I cannot express how amazing she is and how rare as an agent: kind, thoughtful, realistic, honest, easy to work with.

I would work with her in a second if we ever needed to again, and so cannot recommend her more highly.”

If you’re looking for a luxury home or weekend retreat on the Main Line, contact me for off-market options. It’s my pleasure to help.

How do I transition a traditional home to attract today’s luxury millennial buyers?

Millennial home buying trends have become a hot topic in luxury real estate. Millennials include anyone born between 1981 and 1996, and they’re quickly becoming a dominating force in real estate. In 2018, millennials represented the largest cohort of home buyers at 37 percent, according to the National Association of Realtors’ 2019 Home Buyers and Sellers Generational Trends Report.

This group now outnumbers baby boomers, and what they’re looking for in a home is drastically different than what their parents wanted when they entered the market.

Now more than ever, luxury buyers are viewing time as a luxury. How does that translate?

Homes need to be move-in ready. It’s not just about the money. The time it takes to renovate is too “expensive” in terms of what it takes away from quality of life.

So how do you transition a traditional home with stately architecture to attract a modern millennial buyer? My LIVE broadcast guest, Christina Henck, owner of award winning Henck Design shared some valuable tips and insights:

When we talk about “less is more” it relates to a key design element we artists called “negative space” – that’s the “blank” or “empty” space on a canvas surrounding an image, or the space between and around elements of a sculpture. The negative space is as important in design as the “positive” space (image, element – or in this case furniture).

Check out the clean design and flow created in the “negative space” in this luxury home.

The “negative space” creates a visual flow as well as a physical flow for walk through traffic on home buyer tours as well as videos.

Both are important elements of creating the kind of “sizzle” you want to drive buyers to take action!

Let’s talk! Please book a private consult on my calendar, and we’ll look at your home through FaceTime or Zoom and discuss ideas to maximize the market appeal for today’s buyers.