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Brian O'Neill
Around Town: In the real estate typhoon, Pittsburgh holds steady
Tuesday, September 30, 2008

The Pittsburgh real estate market is tough to pigeonhole, and the map below, which looks like a tie-dye project gone awry, may not be much help. You just have to take my word that this sets us a bit apart from the rest of America.


A Seattle online real estate service company, Zillow.com, says that while median home values in the United States declined by nearly 10 percent from June 2007 to June 2008, they were actually up a hair, at 0.6 percent, in the Pittsburgh metro area.

Not only that, but:

• Among the top 25 metro markets, only Pittsburgh saw the homes of its inner core -- that area within 10 miles of the center city -- increase in average value in the year ending June 30.

• Pittsburgh and Dallas were the only two metro areas where the average values of homes 20 to 40 miles from the center city went up.

Our values are, quite literally, all over the map, and, because these estimates are three months old, they may already be from an entire economy ago. But the joke that has been going around real estate circles -- that you can't get a hangover if you were never at the party -- seems borne out by Zillow's findings.

See the chart at right: Here's how Pittsburgh compared with the rest of the nation, moving out from the center, in home values for the year ending June 30. (Zillow did not rate the entire metro area, excluding most of Armstrong, Beaver and Fayette counties.)

The good news for Pittsburgh's inner core is not confined to the city, and the map should tell you that there is no real consistency within any circle one could draw. Zillow uses ZIP codes for its findings and, because the city's footprint is irregularly shaped and unusually small, Pittsburgh's inner core includes many suburbs. Some are within four miles of Downtown. The 10-mile circle extends south nearly to the Allegheny/Washington County line, west to a point shy of the airport, north to a point about halfway through McCandless and Hampton, and east to a point in Penn Hills.

"You're bucking the national trend in some respects,'' Stan Humphries, vice president of data and analytics for Zillow.com, told me, "and there are interesting differences from the radial pattern.''

Zillow uses concentric circles because, according to its Web site, "If you're a homeowner living close to the city center, chances are your home value is holding up better than your friends in the suburbs.''

That's certainly true in most top markets tracked by Zillow, though Atlanta, Baltimore, Cleveland and Providence have been exceptions, with the inner core off to a greater degree than more distant suburbs.

Zillow doesn't definitively state the reason for the national trend of better values closer in, but commuting costs have to be a key factor. If that's less of a factor here, if concentric-circle figuring doesn't apply, it's easy enough to guess why.

We have 42 school districts and 130 municipalities in Allegheny County alone. We have a light-rail system that goes only in one direction. We have a busway to the east that is heavily used by commuters and a busway going west that carries only a third as many riders. We have some communities still trying to recover from the collapse of the steel industry more than 20 years ago. We even have people who will proudly say, out loud for all to hear, that they won't cross rivers.

No computer system could put a circle around such a people.

But this snapshot of Pittsburgh, as it was just three months ago, seems to show that we weren't as crazy as everyone else. We weren't the ones making bad bets on real estate. We have valued homes for our own peculiar reasons, and we appear to have come closer to the truth of their worth than most Americans did.

That may be small comfort going forward, but it's about all there is today.


Brian O'Neill can be reached at boneill@post-gazette.com or 412-263-1947. More articles by this author
First published on September 30, 2008 at 12:00 am