Sean - I agree that the reduction in interest rates has had a tremendous effect on housing prices - at least the listing price - by making the overall cost of a house lower (over the run of the mortgage). Thus, someone can afford a far more expensive house (and the prices can go up) while still paying the same monthly payment.

Add to that - down payment requirements that once ranged from 10 to 20 percent are gone - probably forever. I read of programs providing people with more than the cost of the house - so that points and closing costs can be covered.

Lastly, I think that the tanking of the stock market (which is where most people put their money in the 90s) has also had a profound effect. No longer do people assume that their money will work best for them in the equity markets - and folks have looked anew at the real estate market. This is both good and bad - since it's my belief that folks should primarily be looking to buy a home (as their residence) rather than an investment.

It's sort of been the perfect storm. But, as interest rates go up, and the stock market regains its appeal, look for housing prices to flatten or go down.

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“Cities have the capability of providing something for everybody, only because, and only when, they are created by everybody.” - Jane Jacobs

I'm with you, Brooke! You couldn't pay me to live in one of them-thar red states! :razz:

Hey, don't forget that urban areas in the South are often blue . . . there are just more rural areas and rural voters in those larger states than in the North, where many of the states are smaller (PA could easily have gone in the "red" column this time, you know) and more dominated by urban centers. You could definitely pay me to live in the south, as long as I was in a city. I miss it every day, but I had to move here for my job.

For the record, I wouldn't live in the South because I'm a Northeastern girl...type A and get to everywhere and say everything fast fast fast! And because it's too hot there!

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Resident of Fishtown, Moderator of Fish/No. Libs/Kenzo forum, Real Estate Agent-Prudential Fox & Roach

I don't like using the term gentrification ... these homes are returning to there once lost value.

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Illegal aliens have always been a problem in the United States. Ask any Indian. - Robert Orben

Keep looking at the price trends...and the DOM status of many of these 'values'

Im curious to see what the spring brings.

house prices are kind of nuts everywhere. is this the new future? no one knows but chances are it's not. the housing market has the same kind of fevered pitch the stock market did in the 1990's. buy before it's too late! it's a new market! things are different! poo. if philadelphians know anything it's that what goes up must come down. an increasing amount of the economy is financed with debt and homes are no exclusion but it will stop sometime. anyone notice that going to europe is more expensive? soon everything we import will become more expensive. energy prices will rise and anything else that does not benefit from iincreased productivity. I'm not saying the housing market will collapse or anything drastic but the current environment will change. I saw homes going for near $400k in "Noerthern Liberties" on teh west side of teh highway...literally on the side. that's a bit much. In the burbs peopel want $450k for homes not touched since 1968.

Hey, El! I believe I can answer the question to what you was saying as why things might be getting expensive and the simple answer is inflation, which is the only way America can keep up with the international economy. Remember hearing how Hershey was raising it's prices on it's candy bars? That's because they want to keep their worth as a reputable wealthy company. Also it has something to do with the euro doing real good in the European economy and the decreasing worth of the American dollar in the international market.

As for people moving into homes that cost $400-$500k that's near a highway or a slum, I'm thinking that they're trying to attract high scale people to that particular area, like Northern Liberties, which was already gentrified. Now South Phila is looking like a hot spot, but I personally don't believe that it will change because of the fact that you have families, mainly of Italian stock, who owned those houses for generations, and also to the Italian institutions in South Phila (the Italian Market, Pat's and Geno's, St Maria Goretti), which every Italian in the city holds dear to them. Even though South Phila is changing and becoming more diverse with Chinese, Vietnamese, Asian Indians, and now Mexicans and Colombians, I still see it as the Italian outpost of the city, just like Port Richmond and Bridesburg is for the Polish, Fishtown and Pennsport for the Irish, Chinatown for the Chinese, and North Phila, which has the largest black community in the city, even up north in Logan, Olney, Germantown and Oak Lane, where you'll see a growing West Indian community over there.

Speaking of North Philadelphia, I've heard that they're trying to rebuild some of the mansions down there, as well as Parkside, in West Phila, and build some new homes there as well, and they're supposed to go up somewhere around $150k. That's where the former Schmidt's brewery was located until they closed in the 80's. Boy, I wish we had our own brewery, but right now I think it's going in the right direction. Also, between Girard Ave and North Philadelphia Station, on Broad St, we need to make that a part of the city. Make Broad St from Susquehanna Ave to Girard Ave a place for college students, like add a Starbuck's, or a Barnes and Noble, or even a strip of nightclubs where local bands can play either reggae, soca, hip hop, jazz, and even rock, fast food joints, a couple of Wawa stores around Temple, and even some affordable housing or apartments for the students and the faculty. North of Temple might need maybe a few more stores, and train service from Amtrak at North Phila station. That way Temple can compete with UPenn with their 'university city'.

Yeah, North Philly is taking off from the gentrification of Fishtown, West Philly, etc...all the borders pushing outward. There's nothing I know of going on with Schmidt's site though...although that's still Northern Liberties. The mansions they're renovating on Girard in North Philly near Broad are just horrendously being done...they have tiny replacement windows in these enormous windows. It's painful to look at. Sure, we all hope they'd come back to glory...but this isn't it. Ugh. Anyway. It sort of make me think these will end up being higher rent section 8 homes or something. No care. No attempt to appeal to new buyers. And again, you'd have to make something pretty spectacular to get me to live at Girard and Broad.

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Resident of Fishtown, Moderator of Fish/No. Libs/Kenzo forum, Real Estate Agent-Prudential Fox & Roach

We do have a brewery. Yards Brewery and they do tours and everything, they have cool posters with like 150 old Philly Brewerys pictured with their old addresses.

And yeah housing prices awesome. Keep up the good work.