If you’ve been following our coverage of the Philadelphia rental market, you already know which of Philadelphia’s rental neighborhoods are the hottest in May and in the summer. However, there’s more to consider when looking for an apartment than just the price and the location; amenities are important too. To shine some light on this aspect of the rental market, we first asked: which amenities are available, and what fraction of apartments feature them? After selecting a number of luxury amenities to investigate, we looked to the data as usual for some insights into the distribution of rental amenities throughout Philadelphia.
Is “luxury” actually rare?
Overall, the single most frequently listed amenity throughout the rentals was “stainless”, as that amenity was present in nearly 11% of the listing observations (“stainless” likely refers to stainless steel kitchens). Listings for rentals with doormen were the least common, comprising roughly 1% of the listing observations. Nevertheless, between one-fifth to one-quarter of all rental listings had at least one luxury amenity.
Next, we looked at how the term “luxury” is used compared with more specific feature descriptors–while the presence of granite, stainless, or a doorman are all objective and verifiable, the scope of what is considered “luxurious” could prove a bit more subjective. Did the use of the term “luxury” line up with how often we would expect to see it, given what we’ve observed about the frequency of luxury features? It would appear that, yes, there is some truth in advertising–only about 4% of apartment listings indicated that the unit had “luxury” features, suggesting the term is used judiciously.
Is there a better time to look for a luxury apartment? From the chart above, we can see that the proportion of listings with any luxury amenities stayed between one-fifth and one-quarter for the past ten months. Although the winter months saw a slight decline in the frequency of luxury apartments, the impact of seasonality appears to be relatively low, at least in this year.
Let’s talk cost/benefit
Ritzier amenities tend to come with ritzier price tags, however. Lest we forget, apartment rentals, like anything in life, demand tradeoffs. With that in mind, which neighborhoods have listings with the most “bang for the buck?” Given the information on neighborhood amenities newly in hand, as well as our previous coverage of Philadelphia rental neighborhood prices, we only had to combine the two to produce a ranking of the “best deal” neighborhoods in Philadelphia:
Best Deal: Mill Creek
A quick note on methodology: the “best deal” ranking above is derived by taking the price per square foot in the neighborhood and dividing by the median frequency of having any luxury amenity (lower ratios are better). This metric provides insight into the most affordable places to find apartments that also have luxury features. Lastly, to keep the rankings relevant to current market conditions, the prices and amenity frequencies used are the three-month moving average of their respective monthly median values.
The top-five “best deal” neighborhoods overlaid on our rental price heat map
The map and the rankings show that there are a number of neighborhoods with affordable but well-equipped rentals, especially West and North of Center City. In fact, the majority of apartments listed in Mill Creek and Haverford North (numbers one and two, respectively, on our list) have at least one luxury amenity. While Mill Creek has consistently posted high figures for the proportion of its rental stock with a featured amenity over the past ten months, the fraction of such listings in Haverford North has increased dramatically since the fall of 2012, especially since this April:
There’s no such thing as a free lunch
The impressive increase in the median frequency of luxury listings in Haverford North over the past five months has not come without a catch. As this screenshot from our Competitive Intelligence product shows, the rise in the proportion of luxury listings has been mirrored by a dramatic increase in median rental rates. From April to June (and persisting into August), the median rent per square foot in Haverford North roughly tripled.
There’s definitely more than one angle to look at all of this data, and plenty more data to analyze, so check back for more on rental markets around the country.