[cardeza]

Originally Posted by PHLtoNYC

Replying to your post, but not calling you out.

While the rental market may be in a temporary dip, the details don't paint a grim picture.
(I see this headline as keeping with the trend of all doom & gloom in Philadelphia, versus an actual informative measurement of the market)...

1. Per an article quote, during market equilibrium, 5.5% of buildings offer concessions, the current rate is 8.4%, also coming out of the slower winter months.

2. Concessions aren't a new phenomenon, and Philadelphia actually ranks on the low end of markets offering concessions (lower than hotspots like Atlanta, Nashville, Austin, etc.).
https://www.zillow.com/research/rent...essions-33386/

3. There are thousands of units coming online at nearly the same time in a relatively small geographic area, yet the overall rental vacancy rate in Philadelphia is still well under 10%. This is likely a brief period of higher vacancies/concessions while units are absorbed. By early 2025, the amount of units coming online will drop significantly and the market will have time to catchup.

4. Lastly, as the Ryland developer said, this is temporary and not really alarming.

I dont know that the article is attempting to sound the alarm- I know many of you push back on any remotely objective article that says anything other than there is unlimited demand for these apartments. I think the article is giving a balanced look at the situation- certain areas are seeing a potential glut of luxury apts and they are all going after the same renters in the same price points. It's not a catastrophe, but its likely going to take a while to sort out considering the close proximity of some of these projects. Overall, there is little to no population growth here so naturally there are only so many new apts that will comfortably be absorbed, especially when so much of the new supply is in one area of the city.