Lawrenceville was already expensive back in 2015

In honor of NEXTpittsburgh’s 10-year anniversary, we’re looking back on our top stories of the last decade. This post was originally published on March 15, 2015.

Maggie Negrete rented a house in Lawrenceville for three years but knew it was time to go.

The popular neighborhood stretching eastward from the Strip District along the Allegheny River is experiencing a phenomenon: Rehabbed homes now cost $325,000 to $450,000 and a new townhouse can top $500,000. Many rentals are $2 a square foot, and going up.

“I saw the writing on the wall. I wasn’t going to be able to live there much longer. Everyone I knew, their rent was going through the roof,” Negrete says.

Last March, she moved to Allentown, where she bought a two-story frame house built in the 1900s near Grandview Park with a porch, fenced backyard and half-finished basement for her artist’s studio. The home was move-in ready, though she’ll update the kitchen and, with a loan from the city’s Urban Redevelopment Authority, replace the boiler.

She chose Allentown because “I knew that Lawrenceville, Bloomfield – those were out of the question.”

Paolo Pedercini, 34, associate professor of art at Carnegie Mellon University, thought the same thing when he bought a house in Garfield and moved with his girlfriend last October after four years in a Bloomfield rental. They were priced out of the neighborhood, he says, and liked Garfield’s diversity.

“I’m not interested in being in the next Lawrenceville or East Liberty if that means that the people who are living here are going to leave,” Pedercini says.

The three-story late Victorian he bought from the city had been boarded up for five or six years and needed “significant investment” to renovate. And now?

“We are definitely happy,” he says. “It’s a lively neighborhood, across from Bloomfield and Friendship. We didn’t have to change our habits.”

Negrete, 28, can take a bus from her hilltop neighborhood to her job Downtown at the Greater Pittsburgh Arts Council. Her neighbors are “very nice, inviting,” and she has befriended the business owners along East Warrington Avenue. Mornings, she walks with neighborhood kids to their bus stop.

“From my second-floor window I can look out over the top of hills, and I can see for miles and miles. It’s beautiful,” she says. She laughs, thinking back to the one house for sale in Lawrenceville for $55,000 that caught her eye, until she found it had no utilities. “There weren’t even walls.”

Lawrenceville, she says, “is changing so fast. The old cast of characters, who had been there their whole lives, are becoming the minority. It just doesn’t feel the same.”

Though most homes for sale in Pittsburgh are priced under $100,000: new construction and renovated older homes in Lawrenceville are listed for $300,000 to $500,000, says Kyra Straussman, director of real estate with the URA.

People who can’t afford pricey neighborhoods such as Shadyside, Squirrel Hill, East Liberty and Lawrenceville are looking in Morningside, Polish Hill and Stanton Heights, says Straussman. She recommends they also explore buying in the West End — Elliott, Sheraden or Chartiers — or in South Hills neighborhoods such as Allentown, Mount Washington, Beltzhoover, Beechview, Brookline or the suburb of Dormont.

“There is incredible housing stock, greatly undervalued, particularly for families,” Straussman says.

Most neighborhoods have bigger footprint homes, built when the city’s population of 305,000 was double its size. Other areas, such as Carrick and Stanton Heights, have smaller homes that were built for middle class millworkers, developed in the 1950s and ‘60s.

A buyer can find, “if not bargains, certainly reasonably priced homes in reasonably good condition,” says Straussman.

Matthew Galluzzo, executive director of Lawrenceville Corp., acknowledges “profound market pressure does exist in our neighborhood, for a lot of different reasons.” He cites UPMC Children’s Hospital and a bustling business district with shops, restaurants, a movie theater, pinball arcade and bowling alley.

“We saw it by the end of 2012,” Galluzzo says, recalling a home needing work that sold for $411,000. “We realized the market was turning much more quickly than we’d seen.”

To address the need for permanent, affordable housing, Lawrenceville Corp. last year “green-lit what will become the first community land trust in the city,” using its equity and money from philanthropy and the URA, he says.

Galluzzo doesn’t want to discourage the wealth creation that’s happening — “there are clear benefits to having a stable real estate market,” he says — but none of the new housing units coming online will be affordable.

“That’s a crisis for us,” he says.

Exploring options

These days when Greg Panza visits Lawrenceville for a night out with friends, “I feel like I’m on vacation,” he says.

Panza, 44, a Realtor with Northwood Realty Services, suggests prospective homebuyers look at his neighborhood of Mount Washington.

“Some people are real diehards and they want to be out that way,” he says of Lawrenceville, “but I’m trying to communicate to people there are other options that are half the price with just as cool homes and with growing amenities.

“So before you spend $400,000 on a house, come to Mount Washington to see the same house for $250,000, with parking [and] a little more elbow room.”

The Mount Washington Community Development Corp. bought and renovated homes in the Estella micro-neighborhood during the past five years.

“What was our poorest performing neighborhood has dramatically increased in value,” Panza says. “The highest priced home that sold in 2010 was $100,000; in 2015, the highest priced home was $230,000 and that was a remodel, gutted and flipped. Even the median price went from $38,000 to $75,000.”

Nearby, Joe Calloway, owner of RE 360 development company, is committed to erasing Allentown’s decline. In the 1990s, before the Zone 3 police station moved there, “it was one of the worst” neighborhoods for crime, he says.

But Calloway, 35, of Pine took the risk and began buying properties. He owns around 40 parcels in Allentown, including 11 commercial storefronts and two warehouses, and his construction company helps offset his remodeling costs.

He convinced the Birmingham Foundation to invest in his project to buy low-cost, rundown homes and fix them up for sale at $125,000 to $150,000 — or more.

“Allentown is on the cusp — an up-and-coming neighborhood like South Side Slopes,” Calloway says. “You get an amazing amount of house in these neighborhoods, considering Allentown is 1 mile from Downtown. This is a great community.”

Unlike Lawrenceville’s obvious transformation from industrial past to a shopping and dining destination, Calloway acknowledges it’s too early to track real turnaround in Allentown. But he, Panza and Josh Lucas, with the Work Hard Pittsburgh small-business incubator, have faith in its eventual transformation.

“You can see the change already — a lot of young people,” says Lucas, of Duquesne Heights.

Some Allentown homes Calloway bought for $30,000 or $40,000 and invested around $10,000 in cosmetics to make them more livable. Others required $50,000 or more to modernize.

Pittsburgh’s median income of around $55,000 doesn’t support homes costing $400,000, he says. “It’s not realistic. It’s not affordable for a lot of people. Not everyone works for Google or a big law firm Downtown. They’re looking to buy in that $150,000 range.”

Calloway made available a warehouse for the Hilltop Alliance’s program, Industry on Industry, which offers discounted studio space to makers and artists. The program is part of the thrust to lure businesses by offering 50% rent abatement for their first year.

Lucas’ incubator and Academy Pittsburgh boot camps aim to help people become self-reliant by learning marketable skills.

“We’re hoping to attract people who fall in love with the community, buy a house and raise a family,” Calloway says. “When we started up here three years ago, everyone thought he and I were crazy. But then came the coffee shop, and tenants in the warehouse who make reclaimed artisan goods, and Leon’s Caribbean, and Spool, the boutique fabric shop.

“We’re getting a ton of people coming. They’re being forced out [of higher-priced neighborhoods] or they’re losing their places to work. We’re saying come over and get good-quality space.”