With a rich history, diverse neighborhoods, and abundant economic opportunities, it's no wonder Philadelphia is one of the hottest cities in the U.S. for real estate investments. It's a place where people are reminded of the past and inspired to create the future. The city has witnessed significant development and revitalization efforts in recent years, with numerous projects focusing on transforming vacant buildings and lots into vibrant residential and commercial spaces. As the city continues to grow and the economy draws young professionals, it's a good time to be a real estate investor in Philadelphia. Philadelphia has a robust rental market driven by its large population and the presence of several prestigious universities and colleges. The demand for rental properties is consistently high, providing investors with a steady stream of income and the potential for long-term returns.
Real estate investors look to Philadelphia’s most desirable locations and up-and-coming neighborhoods where they are most likely to see a return. These are some of the top neighborhoods for real estate investments in Philly in 2023.
Located on the city's east side along the Delaware River, Fishtown is something of a poster child for up-and-coming neighborhoods in Philly. This traditionally working-class neighborhood, once home to commercial fishermen, has been on the rise for a few years now. Today, it is better known as a haven for the city's young, cool, artistic types. It's also home to some excellent restaurants, galleries, and entertainment venues. La Colombe coffee roasters, Pizzeria Beddia, and the Fillmore are all located in Fishtown. And, while real estate prices have started creeping up in recent years, they're still lower than many other parts of the city, making Fishtown an attractive option for investors. According to Redfin, Fishtown home prices were up 3.3% compared to last year, selling for a median price of $377K.
Brewerytown is one of the newest neighborhoods to grab investors’ attention. Located in North Philadelphia on the eastern bank of the Schuylkill River, this neighborhood is named for the many breweries that once operated here. While there are still a number of small breweries left for residents to enjoy, many of the old breweries have been converted into modern housing. Residents of Brewerytown enjoy close proximity to Center City without paying Center City housing prices. Prices here are relatively low at the moment but are expected to increase; in March of last year, the city announced community development partnerships to renovate 53 vacant and distressed buildings in Brewerytown.
Nestled between Fishtown and Northern Liberties is the Olde Kensington neighborhood. The formerly industrial neighborhood is experiencing a significant revitalization, making it a great option for real estate investors. A number of old factories have been converted into modern townhouses, condos, and apartments in recent years, attracting millennial renters and home buyers. The neighborhood is home to numerous art galleries, studios, and creative spaces, attracting artists, designers, and entrepreneurs. The presence of these artistic influences adds to the neighborhood's unique character and creative atmosphere. As the neighborhood has undergone a revitalization, property values in Olde Kensington have increased.
Also popular among developers recently is nearby West Kensington, where hundreds of abandoned properties have been transformed into single and multi-family homes.
Port Richmond is another traditionally working-class neighborhood experiencing a glow-up at the moment. Located on the Delaware River bordering Kensington and Fishtown, Port Richmond is home to a deep-rooted Polish community. That longstanding sense of community is attractive to young professionals flocking to the neighborhood in search of a community that feels close to big city amenities.
Affluent Chestnut Hill is known as Philadelphia's garden district. While this northwestern Philly neighborhood has higher home prices than most other neighborhoods in the city, investing in Chestnut Hill real estate isn't a bad idea for those who can afford it. This part of the city remains one of the most desirable locations for high-income families and executives alike. The neighborhood is attractive for its low crime rates, tree-lined streets, local parks, shops, and restaurants. Chestnut Hill is in close proximity to several prestigious educational institutions, including Chestnut Hill College and Germantown Friends School. The presence of these institutions can attract families and students, creating a potential rental market for investment properties. Demand for housing in this sought-after locale remains high, and property values here are less prone to fluctuation than in other neighborhoods in the city. While much of the neighborhood has a suburban feel, there are some condos and apartment buildings as well.
Another consistently popular neighborhood in Philadelphia is Logan Square. Like Chestnut Hill, property values and rental prices in Logan Square are higher than average for the city, but the payoff for investors can be higher over time. Logan Square is home to some of Philadelphia’s most iconic spots, including The Barnes Foundation, the Philadelphia Art Museum, the LOVE sculpture, and Philadelphia’s City Hall.
Another neighborhood in transition is Strawberry Mansion, located east of Fairmount Park in North Philly. In 2019, the William Penn Foundation committed 1.5 million dollars to the Neighborhood Transformation Initiative, which has helped to rekindle interest in this area. Strawberry Mansion offers a range of housing options, including rowhomes, multi-unit buildings, and apartment complexes. The area provides relatively affordable housing compared to other parts of the city, attracting renters and homebuyers. Housing prices here have been on the rise as the neighborhood and community experience further revitalization, so those who invest in this neighborhood will likely see a return on their investment in the years to come.
