Zillow predicts Philadelphia will be among coldest markets 2021!!

[Garrett M.]

Just came across an article from Zillow with their picks for the hottest and coldest markets of 2021. Austin was their pick for the hottest market.

But why would Philadelphia be among the top five coldest markets? It was ranked fourth coldest after, get this, New York, San Francisco, and LA. I think they wrote “Portland” and something went haywire with autocorrect! Their argument was that people are fleeing overpriced coastal cities. I get New York and San Fran.... but Philadelphia?? There was no data to support their prediction, but they must be going off of some evidence, right?!

Does anyone have any insight as to why /how they would come up with this prediction? I’m not seeing it in Philly. There’s no inventory and everything is selling for 20% more than it was three months ago. Are people leaving in droves? Would love to hear your thoughts!

[Gregory H.]

The city of Philadelphia has stagnated this past year overall. You do still see significant growth in the gentrifying neighborhoods a few removed from Center City, but a lot of the demand has been sucked out by Millennials choosing to accelerate their move to the suburbs, and Gen Z just getting out of college deciding to boomerang back with their parents for a year or two since they can't enjoy the perks of city life right now anyway. The only saving grace for city prices has been that there is very low inventory on the sales front. Rental prices have tanked though. I think once things get back to normal, you will see strong growth in the city from pent up demand. The Philly burbs are crazy right now though. Our investment portfolio up in Bucks county has probably seen 15% appreciation in the past year, and from what I've seen, the Main Line is even more aggressive.