June Top Dollar Homes

Center City, 19107:
$1,306,000 1101 Locust 10 C, 3 bedroom, 2 full bath, 1920 sq. ft.


Society Hill, 19106:

$2,300,000 417 Spruce, 4 bedroom, 3 full baths, 1 half bath, 2968 sq. ft.


Center City, 19102:

$715,000 111 S. 15th St P301 2 bedroom, 2 and a half baths, 2151 sq. ft.


Rittenhouse, 19103:

$1,475,000 134 N. 22nd, 3 bedroom, 3 full and 1half bath, 5,200 sq. ft.


Art Museum, 19130:

$910,000 2000 Mount Vernon St., 4 bedroom, 3 full bath, 1 half bath, 4,100 sq. ft.


Graduate Hospital, 19146:

$810,000 1810 Kater, 3 bedroom, 3 full bath, 1 half bath, 3,000 sq. ft.


19147:

$950,000 717 South Columbus, 3 bedroom, 2 full baths, 1 half bath, 1957 sq. ft.


Northern Liberties 19123:

$940,000 901 N Penn St F1901, 3 bedroom, 3 full baths, 2,045 sq. ft.


Fishtown 19125

$500,000 1226 Marlborough, 4 bedroom, 4 full baths and 1 half bath, 3200 sq. ft.

Real Estate Questions Answered

Question: Are there guidelines about how much work to put into a home?  In other words, how much of the money you put in can you hope to make back in resale?  What kind of renovations are worthwhile and which ones are not? 

Answer: There are a lot of numbers floating around with regards to percentage of return on renovation investment.  For kitchen remodels I have seen numbers vary from a 60% return on investment to over 100%.  The numbers vary greatly because renovation circumstances vary greatly.  For instance, if you spend $70,000 on a kitchen remodel in a neighborhood with home values in the $100,000s you will see a fairly low return on investment.  If you did the same remodel in a neighborhood where the average home value is over $1,000,000, the $70,000 is a fairly conservative amount to spend and there will likely be a high return on investment.  The most important thing to keep in mind is the neighborhood.  The home values and conditions of other houses will be a good guide and will help prevent over and under improving your home.  Below is a chart from Remodeling magazine.  I have included this chart because the numbers seem more accurate than other information available on the web.  

2009-10 National Averages

Midrange Projects

Project	Job Cost	Resale Value	Cost Recouped
Attic Bedroom	$49,346	$40,992	83.1%
Backup Power Generator	$14,304	$8,428	58.9%
Basement Remodel	$62,067	$46,825	75.4%
Bathroom Addition	$39,046	$23,233	59.5%
Bathroom Remodel	$16,142	$11,454	71.0%
Deck Addition (composite)	$15,373	$10,904	70.9%
Deck Addition (wood)	$10,634	$8,573	80.6%
Entry Door Replacement (fiberglass)	$3,490	$2,275	65.2%
Entry Door Replacement (steel)	$1,172	$1,470	128.9%
Family Room Addition	$82,756	$54,051	65.3%
Garage Addition	$58,432	$36,361	62.2%
Home Office Remodel	$28,375	$13,648	48.1%
Major Kitchen Remodel	$57,215	$41,260	72.1%
Master Suite Addition	$103,696	$67,578	65.2%
Minor Kitchen Remodel	$21,411	$16,773	78.3%
Roofing Replacement	$19,731	$13,133	66.6%
Siding Replacement (vinyl)	$10,607	$8,476	79.9%
Sunroom Addition	$73,167	$37,118	50.7%
Two-Story Addition	$156,309	$107,286	68.6%
Window Replacement (vinyl)	$10,728	$8,217	76.6%
Window Replacement (wood)	$11,700	$9,044	77.3%

Upscale Projects

Project	Job Cost	Resale Value	Cost Recouped
Bathroom Addition	$75,812	$43,888	57.9%
Bathroom Remodel	$52,295	$32,196	61.6%
Deck Addition (composite)	$37,745	$22,934	60.8%
Garage Addition	$87,230	$48,762	55.9%
Grand Entrance (fiberglass)	$7,464	$5,135	68.8%
Major Kitchen Remodel	$111,794	$70,641	63.2%
Master Suite Addition	$225,995	$125,793	55.7%
Roofing Replacement	$37,359	$22,610	60.5%
Siding Replacement (fiber-cement)	$13,287	$11,112	83.6%
Siding Replacement (foam-backed vinyl)	$13,022	$10,285	79.0%
Window Replacement (vinyl)	$13,862	$10,601	76.5%
Window Replacement (wood)	$17,816	$12,738	71.5%

Steps to Finding and Buying your Philly Dream Home

1. Talk to a loan officer and get a preaproval.  Sellers have begun to expect this information to accompany an offer to purchase their home.  It also gives you the confidence that the numbers are all in order before you begin your home search.
2. Begin practicing paying your new estimated mortgage amount.  If you are used to paying $1200 a month in rent, but your anticipated mortgage payment will be $1700 a month, begin taking out the $1700.  You can save the extra $500 a month for closing costs or furniture.  
3. Find a licensed Realtor to help you with your home search.
4. Make a list of wants and needs for your new property and discuss this list with your Realtor.  Begin searching listings and choosing properties you would like to see.
5. Go on showings and to open houses to find your dream home.  During this time, revise and adjust your wants and needs list based on the houses you see.
6. When you find your dream home, you will write an offer with your Realtor. 
7. Your Realtor presents your offer to the Seller's Agent.
8. The price and conditions of the purchase are negotiated and hopefully an agreement is reached.  The contract is ratified, signed, initialed and delivered to all parties.
9. Schedule all inspections and appraisals.  Expect to pay around $200-$500 for each inspection.  The date for settlement (the day you get the keys and it is yours) is scheduled. 
10. Hire a settlement company (will do title search and other paperwork to make sure settlement can happen), purchase homeowner's insurance.
11. Finalize mortgage loan with lender.
12. Schedule move-in, set up utilities
13. Do your final walk through of the property.  The morning of settlement you will get a chance to walk through the property to make sure any negotiated work has been done, all included fixtures have been left, and property is in appropriate condition.
14. Close on your property.  Bring picture IDs, Certified funds, checkbook, and homeowner's insurance policy.

How is the Philly home market really doing?

I have heard a lot of real estate market doom and gloom recently and you have to wonder how much of it is hype and how much is really true.  In April the big news story was how hot the real estate market was.  The news coverage quickly went negative, however, and there was much speculation that it was all due to the $8,000 tax credit.  Many said there would be awful drops in sales after April 30th.  I decided to follow the market statistics for my neighborhood to see how much of this speculation is true for Philly.  I pulled the stats for the 19147 zip code, for April (the supposed "outlier" month), May and June.  Here is a break down of what I found:

• In April 55 units sold with properties on the market an average of 147 days.
• In May 54 units sold with properties on the market an average of 91 days.
• In June 66 units sold with properties on the market an average of 89 days.

Through out the news coverage, there was speculation that April was only a good month because all of the people who were going to buy this summer just bought early in April.  The statistics do not seem to show that all of these negatives are happening in this area of Philly.  In June more properties sold, and properties were on the market for less days.  I will admit there was a slight variance in average home price over the three months.  April's average home price in 19147 was $357,790.  In May the average was $319,077.  For June, the number was $324,125.  I can't speak for national trends, but in my opinion, Philly continues to be a market that is not doing as bad as seems to be reported.