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.
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!
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.