The Real Deal New York

Philly is a real estate bargain no more

Building boom kicks off affordability crisis
January 06, 2018 09:06AM

(Credit: vic15/Flickr, back; Tom Woodward/Flickr, front)

The city long regarded as a trove of cheap housing — at least compared to New York — is in the middle of an affordability crisis.

Home prices in parts of Philly have jumped more than 50 percent since 2014, according to Zillow — and the increases come as the city is simultaneously home to the largest proportion of residents below the poverty line, as compared to America’s 10 top biggest cities. According to the Wall Street Journal, local government is responding with a new law that would force residential developers to offer 10 percent of new units for below-market rate rents.

Developers could also choose to pay into a city-managed fund to repair homes in lieu of selling or renting 10 percent of its units at lower rates. In exchange, for the concessions, under the law developers would be able to build more units than they would otherwise be permitted under the city’s existing zoning.

According to Alterra Property Group’s Leo Addimando, the law, if passed, would “certainly slow down residential development.”

[WSJ] — Erin Hudson