Ownership Is Losing Its Appeal, Despite Being Preferred by Most Philadelphians

The answer to the never-ending question about renting or owning is quite clear if we look at the big picture. Almost a quarter of the 100 largest U.S. cities changed from majority homeowners to majority renters between 2006 and 2016. There’s no denying that the dream of owning a home is still something many Americans have on their minds but after the housing crisis of 2007, most of them think twice before taking on a mortgage.

According to U.S. Census, between 2000 and 2016, The City of Brotherly Love added about 3% more people to its population and reached a homeowner-to-renter ratio of 55%-45%. This is remarkably different than the 63%-37% from 2000 and what the numbers show is that the balance has swiftly changed in favor of renting – despite the city being currently dominated by homeowners.

Philadelphia’s neighborhoods are mostly homeowners’ territory, but renters are coming in strong

Renting is the popular choice nowadays, but the data shows that Philadelphia’s neighborhoods are occupied mainly by homeowners. To find out more about this, we looked at the renter- and owner-occupied households within the city’s boundaries and the trend is quite interesting. While homeowners have settled around Philly’s limits, renters are predominantly clustered in central areas with just a few majority-renter neighborhoods scattered on the city’s outskirts.

Tap or hover your mouse over an area to see its renter-owner ratio recorded in 2016. Areas marked with orange have more than 50% of their populations living in rental homes. The neighborhoods marked with blue are owner-dominated.

Rhawnhurst is the popular choice for most new renters

Renting is making a comeback in Philadelphia’s neighborhoods. Given the recession, the number of homeowners has drastically reduced by 10% between 2000 and 2016 while that of renters has seen a 26% increase. The best way to exemplify this is by looking at the area comprising Rhawnhurst, Castor Gardens, and Mayfair. The neighborhoods added 4,171 new renters during the 16-year period, more than any other Philly neighborhood. Despite the increase of 198% in the total number of renters, the area has remained owner-dominated. The score, however, is tight with the homeowner-to-renter ratio being 52%-48%. If the area continues to add new renters, the balance will probably shift in favor of renters.

Other neighborhoods that added more than 2,500 new renters since 2000 include Kensington, Harrowgate and Castor Gardens, Mayfair. At the moment, Philadelphia boasts fairly pricey rents, with residents paying $1,547 per month for an apartment which is slightly less affordable than the average mortgage.

Renters took over 54 neighborhoods since the turn of the millennium

It’s worth pointing out that no less than 54 tracts shifted from being owner-dominated to renter-dominated since 2000 while the number of neighborhoods flipping to owner-dominated is significantly lower. The most prominent area to add more renters than owners is the northern part of Philly, covering some populous neighborhoods like Fishtown, Kensington, Harrowgate, Fairhill and West Kensington.

Having caught up with demand, the Philadelphia real estate market is a haven for Millennials and Baby Boomers attracted by the lure of jobs that the city has to offer. Taking this into consideration, it’s easy to see why rent prices here have followed a fast-ascending trend, with rents increasing by 2% compared to last year.

On the other hand, only 7 neighborhoods flipped to being owner-dominated since 2000 and they are clustered mostly around the west part of Philadelphia. These western neighborhoods where owners outnumbered renters include Cecil B Moore, Sharswood, North Central and parts of Wissahickon Park or Germantown, West Mount Airy. It doesn’t stop here as owners also took hold of some parts of the south with neighborhoods like Northern Liberties, Old City or Southwest Center City, Rittenhouse Square flipping to being owner-dominated. Other areas claimed by homeowners are the neighborhoods of Southwest Center City and Bella Vista, Hawthorne.

Methodology — Who is RentCafe and How Did We Compile the Data?

• RentCafe is a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the United States.
• The population data used in this research was provided by the U.S. Census Bureau’s public databases (Population in Occupied Housing Units by Tenure).
• In our study we have compared the number of people living in renter- and owner-occupied units in 2000 and 2016 in census tracts inside Philadelphia’s city borders.
• The population changes have been calculated using data from Census 2000 and the 2016 ACS Five-Year Estimates.
• We used the 2000 and 2016 census tract Shape Files from Census Tiger Files to create the polygons for the interactive map. In order to counteract changes in the Census Bureau’s tracking methods during this period and obtain a comparable partitioning, we combined data from certain census tracts as needed.
• The polygons along the perimeter have been cropped to match the city boundaries. In these cases, we analyzed partial data (fraction of the total, proportional to the surface area inside the city boundaries).