It’s just over an hour long, so grab a cub of coffee and some snacks. Be sure to stay tuned as Council Member Allan Domb adds some important insights you won’t want to miss at the end during the Q&A session.
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
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.
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.
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.
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.
When mortgage forbearances under the CARES ACT were promoted, no one realized 6 months later we would still be in the midst of this COVID crisis with forbearances ending, and no easy answers in sight.
Information was confusing, and many people signing up for forbearances did not realize that the full amount would be due at the end of the agreed upon period in order to become current on their mortgage.
Experts say it’s important to reach out to your lender ahead of the ending of your forbearance to discuss options. Such as converting the missed payments to a deferral on the end of the loan (see articles below).
Also, you’ll want to check your credit report to see how exactly this is being reported.
Where can you get help? These consumer resources include links for helpful details:
“Under provisions of the CARES Act, if you get mortgage forbearance on a federally backed loan as part of COVID-19 relief, your loan servicer cannot charge extra interest on forbearance repayments or require you to repay excused payments in a single lump sum at the end of the forbearance period.” Experian.com
There are different options on different types of loans.
What’s so confusing are the ‘sound bytes’ shared, when what’s needed is detailed information regarding your particular situation.
How do I negotiate with my lender about my forbearance?
Negotiating with your lender can be scary, and confusing. Two local experts recently offered their insights and availability on my Podcast to help home owners in the Greater Philadelphia and New Jersey areas – Lee Perlman, Bankruptcy Attorney and Michael Daiello, Real Estate Dispute Attorney and Litigator who specializes in helping landlords who face the impact of tenants not paying rent under the CARES ACT rental forbearance protections.
September showed record breaking sales in Philadelphia, but what about the dramatic spike in pre-foreclosure distressed properties? Does the foreclosure market threaten to haunt real estate values in Philadelphia?
Market reports are complicated with what science fiction buffs might call “multiple realities” – especially true in our current national economy. You don’t have to understand quantum physics, but there are many sides to the story of current real estate market trends on the Main Line and in the greater Philadelphia area.
You’ve probably heard me say this before, analyzing real estate markets is a lot like watching the ocean. What appears to be calm water, can have cross currents and under tows to be aware of.
Let’s start with the good news!
September was record-breaking month for both number of sales and median sales price for Philadelphia County.
On the Main Line, demand continues to exceed supply with values on the rise and days on market declining.
“Servicers may report that your account is in forbearance. However, if you were otherwise current on your account and have received relief as defined by the CARES Act, your servicer or creditor is required to report your account as current”
What to do now?
As you can see, I’m a fan of analyzing data. However, when it comes to deciding the right time to buy or sell it’s important to look at the big picture of your goals. History has shown real estate values survive market changes in the long run. It’s all about what’s best for you.
Please contact me for a confidential consultation. We’ll look at the micro-market trends for your particular goals and location.
And if you know anyone facing problems paying their mortgage who wonders what to do now, it’s time to get help! For more information about short sales and options to avoid foreclosure, visit FightTheBank.org.
Be sure to subscribe for future blog updates. Let’s talk!
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 😎🏄🏼♂️
“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.”
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.
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.
Visiting Open Houses has been a favorite activity of home buyers for decades. Long before HGTV, this was an attractive, non-committal way of exploring neighborhoods, or getting good interior design ideas.
In fact, my husband and I made an offer on our first home after visiting an open house back in the 90’s. I had visited EVERY open house for many weeks to get an understanding of the market. I knew when we saw this one it would go fast and it was priced right.
Open Houses Now
Times change, and home buying in 2020 especially!
With a 2nd wave of COVID-19 lurking around the corner I ask the question- do you feel your safety is protected at open houses?
If you skipped the video, I understand! 😊 Long story short, I’ve been using open houses as an opportunity to preview homes on behalf of my clients.
Surprisingly I’ve found a wide range of COVID-19 precautions in use and quite often, lack of.
What are the guidelines?
Just to be clear, the guidelines and requirements from the National Association of Realtors AND the State of Pennsylvania require: ✅ masks for everyone (I also provide gloves) ✅ COVID-19 health questionnaire, filled out, signed with contact info ✅ no more than 3 people in the home at a time
At recent open houses I’ve hosted at my seller’s request, out of curiosity I’ve asked people what their experiences have been, and how they feel about it. Me playing ‘Jay Leno’s “Jaywalking”, on the street reporter‘ (more 90’s flashbacks) 🤣💥
What I’ve heard from you
Many commented that it was uncomfortable, but also expressed a desire to look at homes casually trying to sort out what their dream buying goals are – and learn neighborhoods. Just as it always has been.
One lady thanked me for providing gloves. She said has had to do the “Molly Shanon” from Superstar to avoid touching anything as she walks through other open houses!
I’m proud to say our broker at KW Main Line requires us to strictly abide by these standards. However, at other open houses on the Main Line, I’ve seen realtors letting unlimited groups of people in the house at the same time, and no COVID questionnaire – but at least they had masks on!
It’s always been my business practice to put my client’s needs first. Providing virtual access via video and live streaming is something I adapted early in my career to make it more convenient for my buyer clients, whether they were early in the process or trying to make a short term decision.
Now, more than ever, this type of VIP, concierge service offers you both convenience (saving time) and safety!
What are your thoughts?
Please share and comment. Are you attending open houses instead of booking an appointment? May I ask why? Look forward to hearing your input.
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.
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:
Contrary to Gillan’s analysis, Rittenhouse Square results from the exact same set of data shows a decline in median sales prices:
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.
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.
“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.
As an example, I had the honor of helping my Manhattan clients purchase this luxury Merion Station home during the COVID-19 shut down.
“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.
If you’re working on your taxes during #stayathome, there’s some good news from the IRS that can dramatically help investors. Please read the update from Pennsylvania Association of Realtors below:
The IRS issued guidance Thursday evening to grant deadline relief for both 1031 like-kind exchanges and opportunity zone investments that are already underway. Both of these programs are designed to promote economic growth in communities, and NAR made the case that investors in these programs should not be harmed due to the effects of COVID-19.
1031 Like-kind exchanges. If an investor has taken the first step of a like-kind exchange by selling the old property, and either the 45-day or the 180-day deadline falls between April 1 and July 15, the deadline has been extended to July 15.
Opportunity Zones. If an investor who sold a capital asset planned to roll over the gain into an Opportunity Fund and the 180-day deadline to do so falls between April 1 and July 15, 2020, he or she can make the investment as late as July 15.
Also, sole proprietors who pay quarterly estimated taxes now have until July 15 to file their second quarter payment. As a result of an earlier IRS notice, first quarter estimated tax payments had already been extended to July 15. This means that any individual or corporation that has a quarterly estimated tax payment due on or after April 1, 2020, and before July 15, 2020, can wait until July 15 to make that payment, without penalty.
For more information on how investors can thrive in the midst of the COVID-19 economic chaos, contact me today and let’s have virtual coffee via Zoom.