Do you think we're seeing a housing bubble? (Pittsburgh: chapel, house prices)

[eschaton]

Originally Posted by PreservationPioneer

It's ridiculous to compare Pittsburgh to San Francisco, too. So Cleveland doesn't have gentrified areas like Pittsburgh? Right. And we're conveniently forgetting that half the East End looks as bad as the slums of Youngstown (Lincoln-Lemington, Larimer, Homewood, Hazelwood).

No, it really doesn't. Cleveland does not have a single middle-class neighborhood within city limits. Compare the income map of Cleveland to Pittsburgh. The only inner portions of Cleveland with a household income of $51,000 or above are Downtown and a small portion of Tremont. Notably areas considered "hip" in Cleveland like Ohio City, Detroit-Shoreway, and Little Italy/University Circle are still low income. There are a few unfashionable outer-ring "suburb in the city" neighborhoods like Kamm's Corner which are still lower-middle class, but that's about it.

In contrast, in Pittsburgh a great deal of the city is middle class and above. If it wasn't for all the students in the East End, the income averages would skew a lot higher. Pittsburgh is just a much wealthier city than Cleveland.

[ferraris]

Here's some differences between Cleveland and Pittsburgh's markets. Just going off the top of my head, so I'm sure there are others.

• I think the biggest difference is just how downtrodden almost all of the east side of the city of Cleveland is. It's just this huge swath of poverty and blight. And it's right on display, not tucked away like Pittsburgh's problem areas are.
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• Pretty much all Cleveland neighborhood schools are considered "bad." There is no equivalent to the Allderdice feeder pattern.
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• Some of the most urban neighborhoods with solid business districts are found outside of the city in places like Lakewood, Cleveland Heights, and Shaker Heights. Many would-be gentrifiers wind up outside of the city.
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• University Circle is an Oasis in a sea of poverty. Oakland is an anchor in a growing sea of wealth.
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• Cleveland and the suburbs have far more of an upper/middle class black presence, including some majority minority middle class neighborhoods.
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• Downtown Cleveland is definitely a job center, but not to the degree that Downtown Pittsburgh is. There is less draw to be close to town and living farther from the city center is less limiting economically. There is much more of a highway system and Akron's economy also probably helps draw the jobs outward a little bit. Not to mention Ohio tends to tax income both where you live and where you work.

[eschaton]

Originally Posted by ferraris

Here's some differences between Cleveland and Pittsburgh's markets. Just going off the top of my head, so I'm sure there are others.

• I think the biggest difference is just how downtrodden almost all of the east side of the city of Cleveland is. It's just this huge swath of poverty and blight. And it's right on display, not tucked away like Pittsburgh's problem areas are.
  -
• Pretty much all Cleveland neighborhood schools are considered "bad." There is no equivalent to the Allderdice feeder pattern.
  -
• Some of the most urban neighborhoods with solid business districts are found outside of the city in places like Lakewood, Cleveland Heights, and Shaker Heights. Many would-be gentrifiers wind up outside of the city.
  -
• University Circle is an Oasis in a sea of poverty. Oakland is an anchor in a growing sea of wealth.
  -
• Cleveland and the suburbs have far more of an upper/middle class black presence, including some majority minority middle class neighborhoods.
  -
• Downtown Cleveland is definitely a job center, but not to the degree that Downtown Pittsburgh is. There is less draw to be close to town and living farther from the city center is less limiting economically. There is much more of a highway system and Akron's economy also probably helps draw the jobs outward a little bit. Not to mention Ohio tends to tax income both where you live and where you work.

I'd add to this that Cleveland is an example of a metro where a lot of the industry was centered on the city proper (particularly the Cuyahoga River area) rather than more evenly distributed in mill towns all around the metro area. Thus a greater percentage of the "old urban" core was wiped out to make way for the mega-mills, and the outer suburbs didn't develop the same patches of poverty phenomena that Pittsburgh has.

[PghYinzer]

Originally Posted by eschaton

I'd add to this that Cleveland is an example of a metro where a lot of the industry was centered on the city proper (particularly the Cuyahoga River area) rather than more evenly distributed in mill towns all around the metro area. Thus a greater percentage of the "old urban" core was wiped out to make way for the mega-mills, and the outer suburbs didn't develop the same patches of poverty phenomena that Pittsburgh has.

I travel to the CLE suburbs for work at least once a month and there is also a distinct difference in how they think about their downtown. I think a majority of people who live in the Pittsburgh area have no issue with going downtown or other city neighborhoods for an event or dinner, but when I talk to co-workers in CLE they avoid it at all costs.

[ferraris]

Originally Posted by PghYinzer

I travel to the CLE suburbs for work at least once a month and there is also a distinct difference in how they think about their downtown. I think a majority of people who live in the Pittsburgh area have no issue with going downtown or other city neighborhoods for an event or dinner, but when I talk to co-workers in CLE they avoid it at all costs.

I work in a suburban Cleveland office and have noticed that "downtown" sometimes just means "the city". Sometimes people refer to things like the zoo or museums as "downtown". These are usually the coworkers who commute in from the surrounding counties.

One other difference I thought of is that the phrase "close to bus line" is not often used as a descriptor in real estate and rental listings.

[eschaton]

Originally Posted by PghYinzer

I travel to the CLE suburbs for work at least once a month and there is also a distinct difference in how they think about their downtown. I think a majority of people who live in the Pittsburgh area have no issue with going downtown or other city neighborhoods for an event or dinner, but when I talk to co-workers in CLE they avoid it at all costs.

Pittsburgh has one of the lowest levels of city-suburb animosity out of any of the cities I have lived in or near. I think a lot of this has to do with Pittsburgh not being as starkly different in terms of income, education, or racial demographics from its suburbs as peer cities. It's not a perfectly representative slice of the metro, but there's just a whole lot more overlap here in general.

[trackstar13]

Originally Posted by gladhands

I’m simply questioning whether these increases are sustainable because I’m fearful of buying a home that may lose 20% of its value in a year or two. That’s dramatically different from feeling entitled to a neighborhood that I can’t afford, in a city filled with neighborhoods that I can afford.

If you are worried about short term losses, do not buy a house. Investing in a house is not a short term venture and if you can't hold the house for 5-10 years then renting is your best option. I do understand your point though about the sustainability of price increases in certain neighborhoods. I am not sure if these neighborhoods will remain "hot" or if they will cool down in the near future. With that being said I don't see places like Lawrenceville or East Liberty declining anytime soon. I think the real question here is how many gentrified neighborhoods can Pittsburgh support and which improving neighborhoods may fall back into decline?

[PGH423]

Originally Posted by trackstar13

If you are worried about short term losses, do not buy a house. Investing in a house is not a short term venture and if you can't hold the house for 5-10 years then renting is your best option. I do understand your point though about the sustainability of price increases in certain neighborhoods. I am not sure if these neighborhoods will remain "hot" or if they will cool down in the near future. With that being said I don't see places like Lawrenceville or East Liberty declining anytime soon. I think the real question here is how many gentrified neighborhoods can Pittsburgh support and which improving neighborhoods may fall back into decline?

Exactly. These kinds of questions are much more relevant for someone who plans to buy and sell quickly. An amateur looking for a long-term purchase shouldn't be trying to time the market IMO.

[gladhands]

Originally Posted by trackstar13

If you are worried about short term losses, do not buy a house. Investing in a house is not a short term venture and if you can't hold the house for 5-10 years then renting is your best option. I do understand your point though about the sustainability of price increases in certain neighborhoods. I am not sure if these neighborhoods will remain "hot" or if they will cool down in the near future. With that being said I don't see places like Lawrenceville or East Liberty declining anytime soon. I think the real question here is how many gentrified neighborhoods can Pittsburgh support and which improving neighborhoods may fall back into decline?

It just seems silly when I could wait a year or two and buy it at a better price.

[WhoIsStanwix?]

Originally Posted by gladhands

It just seems silly when I could wait a year or two and buy it at a better price.

But wouldn't that also likely make your existing house worth less? Unless your intent is to sell now, move into a rental, and buy later (a strategy which has its own host of financial questions to answer), why would it matter?