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January 30, 2015

Philly's housing market is on the up

Economy Homes
West Philadelphia Row Home Thom Carroll/PhillyVoice

Vibrant rowhomes with large porches are a common sight in West Philadelphia.

According to new data, sales and prices single-family homes in Philadelphia are on the rise.

Drexel University professor and chief economist at Meyers Research Kevin Gillen said in his housing market analysis that the upward trend shown during the fourth quarter of 2014 is good news for the city.

Home prices

Despite a small decrease in home value from the third to fourth quarter, Gillen said value increased by 0.8 percent on a "quality- and seasonally-adjusted basis."

Home sales in lower-priced sections of Philadelphia have increased — and house appreciation was strongest in those neighborhoods. West Philadelphia saw a 2.3 percent increase in home prices, Kensington/Frankford saw a 2.1 percent increase and North Philadelphia saw a 0.9 percent increase. Conversely, home prices decreased in neighborhoods that typically are more expensive, like Fairmount — which fell 2.7 percent — and Northwest Philadelphia — which fell 1.9 percent.

The report said that the fourth quarter was the first time West Philly, Kensington/Frankford and North Philly have seen price appreciation for two consecutive quarters since winter 2012.

Sales activity

Compared with a year ago, home sales in Philadelphia increased by 11 percent. The 3,710 home sales in the fourth quarter neared the "historic quarterly average of approximately 3,800 transactions."

The number of home sales in Center City and Northwest Philly have remained stagnant, while sales in North and West Philadelphia increased by 35 percent. Gillen said the changes signify "a positive pattern."

Trulia chief economist Jed Kolko told that while the Philadelphia trend aligns with national ones, it is probably temporary. Urban building costs, suburbanites wanting to stay in the suburbs and the possibility that millennials would move out faster than baby boomers will move in are to blame, he said.