Has the Philadelphia Rental Market Gone Mad?
In the past, I would be upset when a current tenant would call and say they were leaving one of our investment properties that we owned. I would be concerned that the rental amount might go down and even worse it might take a month or two to rent it out. There is nothing worse than having a vacancy (or two) as a property owner!
However, in the last 6 months, when a tenant has said they are leaving, no worries! In every single case, the property was rented out immediately, with multiple applications and a higher rent amount!! In a few cases, the rent amount went up for my properties as much as 20 percent!
This is also the case for the rental properties that are listed on the MLS. It is amazing the number of Realtors that are working the rental circuit on the tenant side as often times there is no loyalty with an extremely fragmented market. A potential tenant can see 10 properties with a Realtor all over town and then find a property on Craigslist. We specialize on the listing side of the equation due to all of the investors that are clients as well as some "accidental landlords". Once listed, the competition is fierce...
A few observations from the fierce market:
- Rental amounts keep going higher, with no end in sight
- The inventory of properties available for rent remains low which drives prices higher
- The demand for these properties is insanely high as folks remain skittish to buy
- When a new rental property comes up, there is a race to get to it!
- There are multiple applications for each property with very little negotiation on the rental price
- The Rental amounts are much higher than what the mortgage would be if the folks decided to buy instead
- Some Realtors are creating a nice niche in this field, while others are just being run around
For much of the younger generation, when all they have seen is the housing market go down down down every year since 2006, perhaps many of these people can only have a rental mindset as they are taught not to buy. And others struggle to get financing since the credit markets are still tight, especially for self-employed people. Add that on top of your regular rental market, and you get one of these situations where rents are escalating...a perfect storm, per se.
It is certainly benefiting investors who have been waiting for higher rents for some time. And some savvy investors are buying up properties monthly in the very strong Philadelphia rental markets such as Fishtown,Northern Liberties, Port Richmond, Fairmount, Point Breeze and South Philly. In addition to higher rents, the other benefit will be appreciation when the market eventually turns for at some point these renters will ask themselves that age old question "Why Rent When You Can Own?".
And when they start doing that, the pent-up demand that is building up will not only stabilize the Philadelphia housing market in 2012 but in my opinion, will send the market higher in 2013 for the first time in many years.
SEARCH FOR PHILADELPHIA RENTALS:
And as always, if you are looking to search for Philadelphia rentals, go to our award winning website -Search Philadelphia Rentals and Search by Philadelphia Lifestyle .
The Homebuying Chance of a Lifetime
It always happens in every market, in the stock market, in business cycles and in the housing market where there are extreme movements to the upside and the downside. The extreme upside is the unsustainable bubble and the extreme downside is the fearful falling knife and doom and gloom.
In simplicity, for the best profit the mantra is "buy low, sell high". The housing market adds many wrinkles besides 
the financial aspect because the home provides quality of life, a place to live and so many other factors besides just the pure financial decision. But when you put today's factors together which includes historically low mortgage rates, soft prices (or stable prices) and the ability to negotiate repairs, it does allow for the "perfect storm" that becomes the home-buying chance of a lifetime.
And whenever you see articles of positive press in the media like the one published this week in CNN Money "Buying a Home Won't Get Much Cheaper" (a great article), the fact is the housing market has already turned. A year ago you would struggle to find one positive article about the housing market (the journalist would probably have been fired), but now the positive articles are more common.
My prediction is that a year or so from now, buyers will never see mortgage rates below 4 percent again. And will be kicking themselves if they were on the sidelines and for whatever reason procrastinated as both prices will start to increase as well as mortgage rates. Do you want to be that person? Like the stock market investor who did not think Apple was a good buy at $10 a share?
In Philadelphia, especially for the first time home-buyer, it is not so easy to find the great products as they are selling quickly and in many cases with multiple offers. When you combine this with insanely high rents that are only going higher, we could easily see the question again "why rent when you can own" as home-buying will not have a stigma, but will be en vogue.
The smarter consumers of course will be ahead of that trend.
Where will you be?
Start your search here and see what's out there.
Just Listed! The 311 on 301 Race Street
Stats: This 5th floor level studio condo is single and looking! Located in Old City's Historic Wireworks Penthouse...
301 Race Street, 515 is a total catch. The unit is very clean, offers a lot of storage, built in closets, high 12 foot ceilings, and tons of natural light. South facing, modern kitchen, Washer/Dryer included, central air/heat, all electric, marble counter-top, shower and floors, over-sized, arched windows, easy to maintain laminate wood flooring, and an attic area. The kitchen also features Lynchberg Cherry cabinets, sliding drawer trays, tile floors and glass and subway tile back splash. FHA Approved!
At $149,900, it won't be available for long...make your move! For more details, please contact the Somers Team.
Relisted! 206 E. Girard Ave, Commercial Storefront for Rent
You're green at home, but how green is your business? This 790 square foot space (with 540 sq basement) at the award-winning Levesque Flats is seeking LEED Platinum Certification. Rent this Commercial Space in Fishtown for just $2,050 a month. You can have it all at 206 E. Girard Avenue...
Finally, Environmentally Conscious Renters can live and work without compromising beliefs in an environmentally friendly world. This is a commercial storefront with exceptional foot traffic a few blocks from the Girard EL station, built with sustainable, recycled, and energy efficient materials. All the wood that built these flats has been salvaged, beautifully handcrafted, with recycled doors, flooring, and stairs. This commercial space has a backyard, raw bath, finished basement, 2 password protected web cameras, it's a MUST SEE! C2 Zoning.
Showings by appointment. For more details, please contact the Somers Team.
A Showstopper near Avenue of the Arts: 1204 S Carlisle Street
Need a 2 Bedroom, 1.5 Bath with an Avenue of the Arts Location? Check out 1204 S Carlisle Street, a must-see home! Many of the original features have been retained and used to complete this transitional style home. A vintage vestibule with stained glass and original tile communicates a welcome home message the moment you cross the threshold. A loft space and finished basement adds more room for whatever it is you need to make your home more comfortable and convenient. Priced under $250,000, this home is a huge value and the upgraded kitchens and baths are sure to amaze. Full tiled powder room and bath, hand laid designs, and crown molding throughout. Marble kitchen floor and the remainder of the home is hardwood.
Go see a show on Broad Street. Walk to Center City restaurants and shopping. Stroll over to Passyunk Square for great pubs and BYOBs and local boutiques. This location has it all. Close to public transportation.
For more details, please contact the Somers Team.
Shopping Party & Fundraiser at SA VA
Looking for something fashion-savvy to do this Wednesday? InLiquid and SA VA combine forces for a special Shopping Party & Fundraiser held at SA VA in Rittenhouse Square. Proceeds will help support programming at InLiquid. Curious about InLiquid? Check out the video feature we did with Rachel Zimmerman last year.
Fresh Address: 800 N Lawrence Street, C
Today's Fresh Address takes us over to 800 N Lawrence Street, C in Northern Liberties.
This is Where It's At: Welcome to this charming 1 bedroom bi-level condo w/ a sunny loft space and many desirable features. As for location, walk to Honey's, Cafe la Maude, N 3rd, the Random Tea Room, and all of your favorite Northern Liberties spots.
Come On In: Enter in through a secure gated entrance leading to a private landscaped brick patio. The front door opens to the living/dining area and kitchen. The main level has neutral tile flooring, a soaring cathedral ceiling w/ new windows maximizing natural light, a full kitchen w/ white subway tile back splash, a peek through window (gas stove, dishwasher, refrigerator, microwave included). There is a powder room in the kitchen, a pantry, and storage closet, and storage nook. The 2nd floor offers a large open sun filled loft w/ (possible uses: den, guest room, office, library, etc...). There is a full updated bath, loft closet, huge double wide hall closet, and main bedroom. Hall laundry (washer/dryer included), new heater and air conditioning, low maintenance & condo fees, and efficient utilities.
Come check it out! For more details, please contact the Somers Team.
Tip Jar: How to Avoid a Crappy Situation When Selling Your Home
We primp them. We pamper them. We dress them in costumes. We name them cute names like Zippy, Cinnamon, and Thurston Howell the Third. We walk them in all sorts of weather. We train them to do clever tricks. We get dates because of them and we will break up relationships over them. They are our dogs and we love them. But in Real Estate, man’s best friend can become Realtor’s worst enemy.
Here are a few examples of "Crappy" situations and ways to avoid them when trying to sell your home:
This photo is of a yard filled with “land mines” strategically placed by you know who, Fido!
Tip: Clean up the doggie remnants in the yard or hire someone to to do it for you. No one wants to play dodge the doodie during their showing of your beautiful home.
Last week I showed a beautiful Fishtown home but the topic of conversation was not about what price the buyer should offer, it was about who could identify the smell? Was it a cat, a dog, a ferret...? I said Sasquatch. It really stunk!
Tip: Animals smell. No offense folks, but they drool, they have accidents, even their food leaves behind a noxious odor. Somehow it is undetectable to the pet owner but believe me, the rest of us smell it! Ozium, Lysol, or any organic deodorizer works wonders when used consistently where your precious has made a mess. Smells can and will kill a deal from being made on your home.
Philadelphia, especially Northern Liberties, is a dog-loving neighborhood. There may be 50/50 split of people to pets! But with ratios like that, the old saying rings true, dogs are better to be seen than heard. Last week after playing what’s that smell (see #2 above) we toured a lovely home. We all peered out of the kitchen window to observe the garden that looked like it was a picture cut from Better Homes & Gardens...until we stepped outside to be met by CUJO. Holy crap...we ran for the front door never to return again!
Tip: There are actually sound ordinances, as well as a bunch of rules that pets and their owners must follow. Nuisances such as noise and droppings are topics of big discussion in Philadelphia and there are rules and fines for pets that behave badly. A tall fence makes good neighbors and in this case a discussion with the neighbor might go a long way in keeping CUJO from scaring off potential buyers.
Now Renting: 706 N Bodine Street
On the hunt for your next place? Now renting for $1,900 a month...
706 N Bodine Street is on one of Northern Liberties' most quaint blocks with a historical and "Elfreth's Alley" type feel. In the heart of the neighborhood and immediate vicinity of N 3rd restaurant, Abbaye and the like. Four levels of living space!!! First floor features a living room with exposed brick and refinished hardwood floors with remodeled kitchen (5 years old), dining areas with exposed beams. The second floor is devoted to a bedroom with a full bath remodeled with imported Marble. The third floor bedroom has a skylight and a working fireplace and retro style full bath. Lower level included finished basement for study, workspace or play room with storage area for washer and dryer and mechanicals. Beautiful intimate side shared courtyard. Brand new energy efficient windows. Super convenient to transportation, Center City, shops, restaurants, stores and the Delaware River Waterfront. And of course the new Piazza! Welcome to Northern Liberties !
Available 6/5/2012. Welcome to your new home. Come check it out! For more details, please contact the Somers Team.
To Do: Lag Baomer Bonfire & Music Festival
What is Lag Ba’Omer, you ask? Lag Ba'Omer is a festive day on the Jewish calendar, celebrating the anniversary of the passing of the great sage and mystic Rabbi Shimon bar Yochai, author of the Zohar. It also commemorates another event. In the weeks between Passover and Shavuot, a plague raged amongst the disciples of the great sage Rabbi Akiva. On Lag BaOmer the dying ceased.
Here in Philadelphia, you can celebrate at the Jewish Center of Northern Liberties with a Bonfire and Music Festival THIS Thursday, May 10th.
The details:
5:00pm - 8:30
Bonfire & Outdoor Party
9 pm
Indoor Concert!!!
Featuring:
LIVE BANDS to rock the night,
BBQ FOODS, BEER, DRINKS,
HUGE BONFIRE in the Lag Baomer spirit
DRUM CIRCLE
Admission is free, please RSVP at the Facebook Event Page.
[image via Jewish Center of Northern Liberties]
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