Old City, Philadelphia

Here we have a short video blog entry about Old City Philadelphia. This is a beta test of future video blogs to come. 2009 will be the year we provide new and exciting inside info on everything from tasty byob restaurants to what variances of the zoning codes have passed at the ZBA hearings. We will spotlight neighborhoods and individual houses or developments. Our hope is to capture you and show you things you may not have seen or heard about before. Its not just about real estate.... its about a lifestyle and Philly has a lot of it!

For those seeking raw Philadelphia sales data....

www.goppelt.net/phpi/phpi2q08.pdf#page=2

Hmm. The financial market.

Interesting times, eh? What does all of this economic panic mean to everyone? Well, the markets that bought, sold, and traded the mortgages 2 and 3 times above the banks that initially lent them are in trouble. The government has this massive bill, which covers everything from additional tax credits to energy star dishwashers to permanently allowing the government carte blanche with terrorist investigations. It is a temporary fix for a much needed economic correction. We are a free market economy and with that, not all businesses succeed. Some fail. Panic arises. Downfall ensues with those who predict what's going to happen next and we spiral into whatever it is we are going into. The fact is, perhaps it was too easy to buy a house 3 years ago. Perhaps a no doc, no verification, interest only loan that would soon balloon into a very high rate with negative amortization wasnt such a good idea. Perhaps an unregulated industry needs to be regulated. These are all larger ethical questions. The immediate resolution: money! Lots of it... and tax credits for the environment. And so, there are proposed tax cuts for wind power, clean coal, energy star appliances, and others. For our every day to day lives, be frugal. Be smart. be sensible. Dont be frivolous and try not to charge up that 24% credit card. Even if that bank folds, Warren Buffet, Wells Fargo or Citigroup will buy it so you will still owe it. ;)

Banking crunch

What does this all mean? Well, for one, i strongly advise everyone to downsize. It's time to crunch and save and be prepared for shortcomings because they may well be around the corner. Many developers are turning to the rental market to wait out the storm while its becoming more difficult to qualify for a loan. However, if you do qualify for a loan, its a great time with the low rates and large inventory. The construction market is still quite healthy in Philadelphia. Luckily, many projects have reasonable exit strategies in fair retail prices or rental capabilities. Those that seemed to be a little unrealistic.... many of them arent built yet. Wonder why?

Please hear this... if its too good to be true, it is. Unfortunately, the mortgage industry isnt regulated. So a door to door aluminum siding salesman could be selling mortgages behind a desk and they make their money in volume. There is no licensing for this field. The fees are not always disclosed far enough before settlement. So, please be cautious and dont go for an interest only balloon that will explode by 3 points in 2 years and render your home purchase unaffordable. The traditionall 10 or 20 percent down mortgage at a nice warm 30 year fixed with very little upfront pointage is looking lovely these days. Go find one!

As for sellers, in this time with a heavy credit crunch, the buying pool has been shaved... maybe in half. We need to create value in your home. We need the perception to be that it is a worthy purchase and there is great differentiation in your home than the rest of the inventory. I just ran some inventory numbers for a developer client of mine and the news was grim. 19125 in the 400-600k home marketplace has a 27 month inventory. Northern Liberties has a 56 month inventory! What does that mean? If there is not one new listing in this price range, it will take 27 and 56 months to sell thru everything that is for sale today. So, competition is fierce. There are still transactions as people still need to move for whatever reasons.... however, the products have to stand out. Have a nice weekend!

Fall Newsletter

Hello everyone. I hope you all enjoyed your summer and lets all hope that this lovely fall continues for 60 days! I am proud of my real estate practice so far and truly grateful for everything I have been involved in. As you may know, I’m an economics major and a bit of a nerd. I believe a real estate agent’s knowledge of the product is extremely important for the client. Recently I was asked to assist the Central Philadelphia Development Corporation and the Center City District in compiling statistical evidence for their annual report entitled Residential Development, 2008: Grounds For Confidence. I was honored and of course leaped at the opportunity. Alas, there is lots to report to you in this newsletter. Philadelphia is a safe investment in real estate. The proof is in the statistics. Sure, the mortgage industry is interesting to say the least and getting a loan is no longer as easy as registering to vote, however, rates are at an amazing low this month. If you are qualified, this is clearly a BUYER’S MARKET! Some people say they want to “wait for prices to drop”…. This isnt happening in Philadelphia…. Not to a drastic savings. However, mortgage rates are dropping! The effect of that is greater than any waiting around theory.

As for Philadeplhia sales figures read the numbers pulled from the multiple listing service:

For zip codes 19103, 19106, 19107, 19122, 19123, 19125, 19146, 19147

Sept 07 to Sept 08: average days on market: 93, average sales price: $377,944, inventory accumulation: 13 months

The year before: average days on market: 92, average sales price: $378,347

As you can see, by annual comparison, center city Philadelphia is quite healthy compared to the national crisis in real estate. Philadelphia historically never peaked crazily and so it will not trough harshly. There is still such growth in Philadelphia neighborhoods that the market remains relatively unchanged. However, banks are not OK. The mortgage industry is in trouble from so many fraudulent and frivolous loans that were given away for years with the boom. SO, the government steps in, saves Freddie and Fannie Mae, rates stay low to encourage growth. So again, note the chart above and realize the savings one would have in buying real estate today.

There is now a federal tax credit for first time home buyers. The credit is for up to 10% of the home purchase price or a max of $7,500. This is another incentive to buy! Many new construction specialists are savvy and would prefer to rent at this time while many hesitate to buy. Don’t walk with the sheep. Think before you sign another lease. You may well be able to afford your first home and the overall financial benefits might well be worth the purchase versus paying someone else’s mortgage.

So, the cash on cash return on real estate investments in Philadelphia, home ownership or rental properties, can still be extremely healthy. It is certainly more reliable than the DOW Industrial Average drop of 449 points today. It is a smart time to buy. Ask me about particular neighborhoods that are stronger than others.

Going green? Like green? Wanna go greener? We all do and we all need to. Here are some simple tips and stats for your enjoyment and hopefully they will affect your daily lives. I know that I have been riding my bike all around the city as much as possible. Its almost faster and the PPA isnt cashing in on parking tickets on my Cadillac! J
Paper bags require a lot of energy to create and plastic bags are made from petroleum, a non-renewable resource, and they aren’t going anywhere. Considering that Americans use close to 85 billion a year, think about how many are just sitting in our dumps. The crusty reusable shopping bags seem to be everywhere now and are often free with advertising info on the sides. Hec, aske me for one if you need one… I have a dozen!
http://environment.about.com/od/recycling/a/reusablebags.htm
Blackout curtains. Ever thought about them? We lose 33% of energy in our homes during both seasons thru the windows. Blackout curtains are thick and go behind your decorative curtains…think of a posh and cozy hotel room where you can sleep late. Blackout curtains also curb noise pollution so for the urban dweller, they are quite handy.

http://www.greenlivingtips.com/articles/260/1/Saving-energy-with-blackout-curtains.html

Guess what?!?! You can reduce your consumption of electrical energy by simply unplugging electronics when they’re not in use. Phone chargers draw energy all day long when they’re left plugged into the wall, and electronics can use 40% of their regular running energy when plugged in on standby. So, hook up a power strip to that home theater system that glows red lights in stand-by mode and save on your electric bills. By the way, PECO is raising their gas rates by 20% and soon their electric. Yipee!
Americans buy 1 billion light bulbs a year. If everyone would switch out just one conventional bulb for a compact fluorescent lightbulb (CFL), it would be like pulling a million cars off the roads. Plus, because the bulbs last 10 times as long and are 25% more energy efficient, they’ll save you some green. The initial cost may seem more than the 2 or 3 for a dollar at the dollar store but the long term savings is great as is the world impact. Every little step helps.
http://www.energystar.gov/index.cfm?c=cfls.pr_cfls
Americans generate 13 million tons of glass waste each year and enough aluminum to rebuild an entire commercial airline fleet every three months. Get in the habit of recycling your glass, plastics, aluminum and paper. Philadeplhia has made it so easy incorporating a single stream recycling program. Starting in January of 2009, they will be picking up recycled containers every week!
http://www.recyclingpays.phila.gov/

I hope that wasn’t too much to read thru and I hope you save this email as a reference for how to improve the quality of your life… perhaps with a new real estate venture and definitely with a greener lifestyle. If you know of anyone looking to buy or sell real estate in Philadelphia, please let me know. I work hard for my clients, as many of you know.

Good day!
Nigel

PS
Enjoy http://nigelknowsphilly.blogspot.com/

Philadelphia is getting it on!

Greenfest, rain barrel seminars and give aways.... green realtors... I am very excited. I am a part of something way larger than me, this city, the world. Every little tiny decision helps make these changes. I refuse plastic bags all day at every store. I am now recycling madman... literally 80% of my trash gets recycled. I wish I could get more bins, though. I do have stickers, though. You can get stickers from the recycling centers and put them on any bins to use them for recycling. In fact, you can actually just write "Recycle" on any bin and they will pick them up for you. Starting January, the city will do weekly pick ups of recycling bins. Yahoo. More later....

EcoBroker Conference

Hello... Today is the end of the short but sweet Ecobroker convention in crusty green Denver. its a great place these days and the energy and enthusiasm toward green building is unreal! We had Discovery channel hosts, major producing EcoBroker certified realtors and tons of educated specialists in many fields of the green real estate practice. I would say that I definitely took about 10+ pages of notes from the various seminars and made some great connections with vendors. I'll be sharing some of this valuable knowledge soon. Check out http://www.ecobroker.com.

Green it up!

Lots and lots of people are speaking of Green stuff. Its funny. The slightest little efforts like leaving the water off while you brush your teeth... Shutting off all of the lights when you leave the house.... Reusing plastic bags that you get from shopping as trash bags. Why throw them away without using them to collect garbage? They are tough to break down and its best that we minimize our use of them. I personally rarely get bags when I go shopping. It's now trendy and actually quite handy to get the burlap or fabric shopping bags from Whole Foods or Trader Joe's or Villa Hut. They are way stronger and hold more stuff too. A win win! And we are not taking these plastic thin pieces of chemical crap and filling our already full land fills.

I will go more into this subject as I blog further and specifically how it relates to real estate. However, we truly are making fractions of change toward our environment with most home green improvements or choices. What really will work is those very expensive light bulbs that use 10% of the electricity of their incandescent counter parts. Also, well insulated homes will help curb our energy bills. Fossil fuels are not unlimited resources so take the train or any public transportation when you can rather than driving your gas guzzling Cadillac (like mine).

I hope you find my bla bla bla's interesting as I intend to share things that I learn. Knowledge is the number one factor that leads to changes so the more we know of reducing our carbon footprint, cutting down on ozone depletion, and then some.... The more likely we all are to do something about it. I could go on but... I'll spare ya for now. Ta ta!