Flanked by major cities that play a prominent role in the nation’s culture, politics and economy (think New York, Washington, D.C. and Cleveland among others), Pennsylvania and its hubs stand their own ground. A blend of urbanity and country living, the state attracts an eclectic crowd of residents, who seek connectedness and seclusion, at the same time. As a result, Pennsylvania’s real estate industry has nurtured a varied character – embodied in luxury townhouses, not-so-distant farms and sprawling single-family residences – that bends to fulfill a raft of needs and desires.
To learn more about the state and the evolution of its real estate, Haute Residence talked to Terese Brittingham and Tom McCouch, owners and partners of Keller Williams Realty Group.
Pennsylvania is a large state. What are the cities and enclaves that attracted the most buyers in 2017?
The two cities that are most noteworthy would be Pittsburgh in the west and Philadelphia in the east. Each of the cities has large suburban communities that support them. Both offer diversity in available employment, education, recreation, arts, and real estate. Culturally they are melting pots that attract people from all areas of the country, because they offer people both affordability and a great quality of life. They also offer easy access to other large cities – Boston, New York, Baltimore, and Washington D.C. in the east, and Erie, Harrisburg, Buffalo, Baltimore, and Cleveland in the west.
As a whole, what real estate trends were observable in Pennsylvania last year? Were there any that surprised you?
Real estate values continued to rise at a steady rate. Inventory has continued to shrink and the population has continued to expand in all directions. There has been an increase in both the resale market and in new construction as more and more open space is becoming developed. Inside the large cities redevelopments of existing vacant homes and vacant lots are becoming hot commodities of investors and real estate developers looking to cash in on the desirability of people who want to move back into the cities. This segment of real estate is popular and attracting many from outside Pennsylvania, because it is more affordable than New York or Boston.
Do you see any enclaves in Pennsylvania, whose real estate market develops differently from the rest of the state? How do you explain such areas’ development?
A lot of growth is in the redevelopment of the inner cities and the expansion of new construction of suburban farmland. The cities have seen increased popularity as younger and older populations seek more diversity than the suburbs have been able to offer. In addition, an emphasis on safety, education, and jobs are a big part of that too. The development of existing suburban farmland is both a financial opportunity for long-term farm owners and that many of the farms have passed onto a generation that is no longer interested in agriculture. Many of the larger farms are still between the larger cities of Philadelphia and Pittsburgh.
Philadelphia is close to major metro areas like D.C. and New York. How is the real estate market in Philadelphia different from them? What are its advantages?
It’s mostly affordability. New York and D.C. have always demanded higher real estate values, New York is the financial capital and Washington D.C. is the country’s capital. What makes Philadelphia so appealing is how easily these two cities can be accessed by car, rail, or airplane. Another huge advantage is that Philadelphia and the surrounding suburbs are known for offering great education at all levels.
According to research by Lindy Institute for Urban Innovation, median home prices and inventories went down at the end of 2017. Has that been the trend for the luxury segment too? If not, how did it fare closing the year?
The luxury market experienced a downturn like many of the areas across the county; however, it has rebounded pretty well and continues to show growth. What continues to drive this market is that the high income earners are still present and that there are financial avenues for the financing of this particular type of real estate.
Wetroplexes are a rising housing type. What is driving buyers toward such developments?
We believe that the millennial buyers are driving this phenomenon as they are attracted to the carefree living and locations.
Affordability is the main attraction for this type of real estate. Millennial buyers are trying to find a niche that allows them to participate in the American Dream. The challenge to this will be allowable zoning changes to support this type of development.
Are there any new developments or homes you are particularly excited to see coming on the market? What makes them stand out?
Yes. The introduction of open-air retail mixed with multiple styles of high-density housing is a new and exciting segment to hit the area. This is very appealing to those downsizing and first-time buyers. It also give other buyers who aren’t able to move to the city to experience a little of what city life would be like. It has also offered destination real estate for those looking for a diverse environment. They have become successful ventures and have created more employment with financial benefits to both entrepreneurs and increased tax revenues to local townships.
What are your expectations for 2018?
There should be high expectations in the growth of all segments of real estate. As values will continue to rise based on the laws of supply and demand, Developers will need to continue to keep pace. Investors will continue to see vast opportunity in Real Estate. Buyers and Sellers will reap the benefits of a strong economy that is based on the diversity of the population of the area, but also the diversity of the Real Estate being offered to those wanting to settle in the area.
Terese Brittingham and Tom McCouch are the exclusive agents representing the Pennsylvania real estate market as members of the Haute Residence Real Estate Network. View all of their listings here.
Images courtesy of Terese Brittingham and Tom McCouch