Student Debt and the Housing Market: Not As Badly Paired As You’d Think

Photo credit: Julia Rowe | Flickr

Photo credit: Julia Rowe | Flickr

This just in from the Department of Misconception Debunking: student loan debt in and of itself does not, we repeat, does not prevent young would-be homebuyers from purchasing a house. Of course, you try telling that to a money-strapped millennial frantically searching for a job that’ll help them pay off their loans quicker, let alone a house. Go on. We dare you.

Obviously, we’ve wholly accepted the idea that massive student loan debt is one of the major factors contributing to a still laggy housing market. But as we’ve just said, this is not necessarily the case. According to a new report from Zillow, it’s only certain kinds of student loan debt situations that hold people back from buying. In some cases, it really just delays the process. To be sure, the shades of grey are somewhat distinct, plus there are other life variables to consider. Here’s what Zillow Chief Economist Dr. Svenja Gudell says about it in a press release:

“Student debt isn’t the evil-doer it’s made out to be, at least not when it comes to homeownership. As long as students stay in school and get a degree, student debt doesn’t deter them from homeownership, although it is possible that student debt could delay homeownership. People in their 20s and 30s are renting longer because they’re delaying marriage, paying a lot in rent, and struggling to qualify for a mortgage when they finally find an affordable home. Add to that list that they are paying off student debt.”

And with that, we present to you what homeownership odds are like as a result of student debt…

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Report Says These Are Center City’s Hottest ‘Hoods to Live in

Gorgeous. |

Gorgeous. |

Do you own a home in one of these Philadelphia neighborhoods? Can’t say we’re surprised: the latest HomExpert Report by Berkshire Hathaway HomeServices Fox & Roach REALTORS has named the following five areas the Hottest Places to Live in Center City, based on the number of homes sold there within the first six months of 2015.

They are as follows:

  1. Fairmount and Art Museum (19130)
    Homes sold: 243
    Median price: $310,000
  2. Rittenhouse Square (19103)
    Homes sold: 174
    Median price: $500,000
  3. Old City (19106)
    Homes sold: 126
    Median price: $370,000
  4. Northern Liberties and Fishtown (19124)
    Homes sold: 115 homes
    Median price: $385,000
  5. Washington Square (19107)
    Homes sold: 68
    Median price: $325,500

Overall, though, numbers have shown the Greater Philadelphia Area to be in something of a rebound as of late (just last week we got a hold of some nice ones from Kevin Gillen, who, granted, also offered a word of caution): in that same HomExpert Report, Greater Philly home sales – that includes New Jersey and Delaware – have jumped by 13.8 percent, “their highest point in four years,” between 2014 and 2015. Between 2012 and 2015, the increase is 24.6 percent.

Zeroing in on Philly, the infographic shows 7,124 homes sold for a median of $155,500 within the first six months of 2015. This number is up from the 6,243 sold in the first six of 2014; the 6,718 sold in the first six of 2013; and the 5,559 sold in the first six months of 2012. Percentage-wise, that makes for a 28.2 percent leap between 2012 and 2015.

Philadelphia 2014-2015

Screenshot of HomExpert Report | BHHS Fox & Roach REALTORS

On a hyper-local level, here’s how particular sections of Philadelphia did in the first six months of this year compared to last year and going all the way back to 2012. (Yo, the Northeast seems to sell more within the first six months, but check out the Riverwards, West Philly and South Philly consistently having some of the biggest increases):

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Philly’s Average House Values Grew Like an 11-Year-Old Boy’s Mustache Last Quarter

Photo credit: Flicker user Jeanette Runyon.

Photo credit: Flickr user Jeanette Runyon.

Much like when your 11-year-old brother showed you that minute we-can-sort-of-see-it “growth” of hair on his upper lip that he dubbed a mustache, a recent fourth-quarter analysis of Philadelphia home values showed an increase in the last three months of 2014: a whopping 0.8 percent. (Granted, he did grow up to have a luxurious handlebar ‘stache.)

According to the Inquirer‘s Alan J. Heavens, economist Kevin Gillen analyzed the data, which showed that in addition to the 0.8 percent hike seen in average house values for single-family homes, house sales also went up, although in that case the increase was by 11 percent, which Gill says marks it as the “strongest fourth quarter in five years.”

So what caused this growth spurt? Here’s what Heavens reports…

Redfin Predicts Philly’s Housing Market Will Be a “Sleeper” in 2015

Photo credit: Flicker user Jeanette Runyon.

Photo credit: Flicker user Jeanette Runyon.

Glance at the latest reports on Philly’s housing market and you find a city with an improving economy, slowly burgeoning job opportunities, and a rising number of new constructions. Reading Redfin’s most recent 2015 prediction chart on the topic, however, humbles our town down to “sleeper” status in the face of “stalwarts” like Houston, Chicago and Dallas.

So how did the real estate brokerage come to that conclusion? For one thing, they didn’t just look at national averages since market level data doesn’t usually show the “widely varying conditions” in the numbers. Instead, they took a closer look at each market and came up with six housing personas, all of which are identified as such:  Read more »

Morning Headlines: University City Leads the City In New Office Construction


It’s official: University City is in a construction boom and we have the numbers to prove it thanks to the University City District’s annual State of University City report.

According to their findings, not only has their been a huge surge in the neighborhood’s population, but there are thirty-two new development projects that were “advanced or completed” during this cycle alone, totaling to “6.9 million sq. ft. of new office, research, residential, academic and medical facilities in addition to nearly 2.2 acres of public space.”

Naked Philly’s Lou Mancinelli points out that the biggest increase in new University City construction has been in private investment, which has earned the neighborhood first place when it comes to office construction in the Philadelphia: “82% of all office construction in the region taking place in UC.”

Related to that, the report also found that office occupancy was highest in UC than any other submarket in Philadelphia (the report says there are twenty-seven), boasting 96% occupancy.

All in all, the last five years has brought University City 9.99 million square feet of real estate projects. Check out the full report here to get a full visual of UC’s growth, as well as the housing graph below.

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The Decline in Homeownership Is My Fault

Bridget Fonda and Matt Dillon in "Singles" were prototypical Gen Xers. And do they look like homeowners to you?

Bridget Fonda and Matt Dillon in “Singles” were prototypical Gen Xers. And do they look like homeowners to you?

Atlantic Senior Editor Derek Thompson breaks down recently released Census stats that reveal that American homeownership is at a 19-year low. He’s a man with a good sense of humor, and he starts strong:

Let’s begin with the youths, as we must. It is a truth universally acknowledged that a journalist in possession of a negative statistic must find a way to blame Millennials for it.

Yes, Derek, and this is as it should be, I’m afraid, since millennial journalists are not helping matters. I recently heard a millennial pundit on NPR justify her generation’s value by noting that Mark Zuckerberg is a millennial. I mean, sometimes your generation just hangs itself. Read more »

Morning Headlines: Home Sales in Philadelphia Continue to Pick Up

Photo credit: Jeff Fusco

Photo credit: Jeff Fusco

Construction is booming in University City and throughout, so that must mean people are buying, right? Well, according to an economist at the Recorder of Deeds Office, Philadelphia’s third quarter did see home sales continue to rise. The Inquirer’s Al Heavens has the story:

An analysis of data from the Recorder of Deeds Office by economist Kevin Gillen showed that sales volume, well below normal since the real estate downturn began in 2007’s third quarter, rose significantly in this year’s third quarter from the second, especially in lower-priced neighborhoods.

Just under 4,000 transactions were recorded in the July-September period – the first time since 2010 that sales have exceeded their historic quarterly average of 3,800, Gillen said.

The 3,937 sales recorded in the third quarter represented a 14 percent increase from 3,466 in the second, he said.

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Morning Headlines: There’s a Construction Boom in University City

4101 Sansom, in development by Campus Apartments. Photo: Laura Kicey

4101 Sansom, in development by Campus Apartments. Photo: Laura Kicey

No doubt new projects sprouting around the city are contributing to Philadelphia’s growth spurt, but University City in particular has been seeing a substantial rise in developments that had last been present decades ago. According to Natalie Kostelni of the Philadelphia Business Journal, the neighborhood is getting over $1 billion in funds for new constructions.

Other positives alongside the building boom include:

Jobs and employment have risen, population grown, housing stock increased, the number of restaurants and retailers crept up and the amount of office inventory has expanded and maintains an enviable 96 occupancy rate, according to University City’s latest annual report. An abundance of development activity is underway and billions of dollars more will eventually be set in motion.

Among the projects planned to help revitalize the West Philly neighborhood even further are the 40th St. trolley station renovation, which is a collaboration between the University City District, SEPTA, and various city agencies.

University City on the rise [Business Journal]

More news this way…

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Philly Housing is Having a Growth Spurt

Photo credit: Flicker user Jeanette Runyon.

Photo credit: Flickr user Jeanette Runyon.

In a contributing article to Next City, Emma Jacobs reports that Philadelphia could be in the midst of an unprecedented housing boom. The growth spurt is evident throughout the city, which was ranked in third place by the Associated General Contractors of America in a list of metro regions who saw a rise in construction jobs.

“Neither of us can remember, in our lifetimes in this city, a construction boom of this magnitude,” said deputy mayor of economic development Alan Greenberger during the announcement.

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Zillow: Home Values and Rents Are Up


Zillow’s latest research shows that nationally and locally home values are up, based on an analysis of 515 metropolitan and micropolitan areas, with 35 of the largest metros areas — Philadelphia included. Here are some overarching stats:

U.S. home values rose 0.5 percent in August 2014 from July, to $175,600.
On a year-over-year basis, home values were up 6.6 percent from August 2013.
The last time national home values were at this level was in March 2005.
Rents were up 3.3 percent on an annual basis.
The calls for 3.1 percent appreciation from August 2014 to August 2015.

In August, Philadelphia, like most of the largest metros, experienced an increase in home values. But it wasn’t a leader: The highest increases were in Miami-Fort Lauderdale, Las Vegas, Riverside and Atlanta. Even so, none of the increases bring any of the metros up to the peak home values from April 2007.

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