Housing submarkets are a type of economic model that can be used to classify neighborhoods based on their housing market conditions. This analysis uses a statistical technique known as Latent Profile Analysis to sort each census tract in the region into various submarkets based on 14 economic and housing stock indicators.

After reviewing numerous outputs, a model resulting in eight submarkets was selected because it is granular enough to capture key distinctions between submarkets, yet general enough to be applied across the region. The goal of this analysis was to create a resource that could be easily understood by a range of stakeholders, including elected officials, government staff, and community members. For more information on DVRPC’s methodology, data inputs, and data sources, please visit the project's Github page.

This type of submarket analysis has been conducted by a number of regional planning entities around the country and frequently serves as a foundation for housing policy conversations and research. As part of the preparation for this analysis, the project team spoke with staff from Metropolitan Planning Organizations that have pioneered this type of assessment about their methods and experiences.

Conducting this analysis at the regional level is essential because the factors and conditions that influence the cost and supply of housing do not neatly align with municipal or county boundaries. As the results of this analysis show, there is no single market for housing in Greater Philadelphia. Instead, DVRPC’s submarket analysis presents the region as a more complex mosaic of multiple submarkets, each with its own dynamics shaping supply and demand. This regional perspective is intended to help provide individual municipalities with a more comprehensive understanding of the economic and social conditions that contribute to their own local housing needs.

Furthermore, the region’s housing affordability challenges are intertwined with several other other critical cross-jurisdictional issues related to transportation, the economy, and the environment. As such, achieving better housing outcomes is critical to realizing the equity, sustainability, and resiliency goals set in the Connections 2050 Long-Range Plan for Greater Philadelphia.

Greater Philadelphia Housing Submarkets was developed as part of DVRPC’s Regional Housing Initiative. The Regional Housing Initiative is an ongoing research and analysis project designed to identify the housing affordability challenges facing our region and evaluate potential solutions.

More information on this initiative can be found at: www.dvrpc.org/housing/regionalhousinginitiative.

DVRPC is committed to working with all of our planning patterns to remove barriers to affordable housing and lower housing costs over the long term. Key next steps include working with our partners to identify and evaluate strategies that local governments can use to increase the supply and variety of housing options based on the nature of their housing challenges.

For more information about DVRPC’s other housing-related work, please visit:
www.dvrpc.org/housing.