Supply Vs. Demand

[James Brand]

This post may be an appeal to the more economically enlightened among you BPers. I am looking for feedback on an internal discussion I have been having. 

I recently purchased a property in the South Kensington neighborhood of Philadelphia. The area is experiencing a tremendous amount of building, old dilapidated properties or lots are being transformed and the area is definitely on the rise. I hold this to be great for the value of the property I purchased, with more and more people coming into the area new retail will follow and the area as a whole will be cleaned up. The increased desirability of the area will surely increase property values, however with a flood of new residences available, who is to say that the increased supply available won't stymie the appreciation that could be experienced. 

I do believe that the turn around of the area will inevitably win out, and that the result will be a rise in property values, but I thought I would post this topic to get some feedback, both from locals and out-of-state investors as well. 

I know many other cities like Boston, New York, Chicago, Portland, Atlanta, and Seattle (to name a few), have been experiencing gentrification. So feel free to weigh in!

-James

[Peter Mckernan]

Hello @James Brand

I know that you say that more and more people are coming into the area; however, how long till you truly believe that it will be a really great place to live and raise a family? Is this a ten year out thought and feeling, or is this a 3-5 year out plan? I would make sure that you know how to gauge that if you are looking to buy more investments properties there.