Pittsburgh market 'slow and steady' as prices rise

— -- Pittsburgh, formerly a troubled steel city, has enjoyed better times in recent years. Last year, it was named the best metropolitan city in the country by Places Rated Almanac.

The city is the seat of Allegheny County, which benefits from a fairly robust economy. Since the steel mills were shut down in the 1980s, the area's economic base has evolved. Today, it has medical centers and high-tech companies. It's also the home of several Fortune 1,000 corporations, including PNC Financial Services, H.J. Heinz and American Eagle Outfitters.

All of which explains, in part, why Pittsburgh's housing market has managed to remain steady through the turbulent national mortgage crisis. Though sales are declining, prices are rising.

"Home prices are going up because we have a fairly stable market," says Tony Mete, president of the Realtors Association of Metropolitan Pittsburgh. "Our market was not drastically affected by the subprime fall." Unlike in many other areas, few investors bought homes in the area intending to flip them for a profit.

Allegheny County hasn't been totally sheltered from the mortgage mess. Foreclosures have increased in recent years. In the first quarter of the year, 1,187 homes in the Pittsburgh area were in foreclosure, according to RealStats, which tracks real estate in the area. That was 6.9% higher than in the first quarter of last year.

Most of the foreclosures have occurred in low-income neighborhoods; 90% of the homes that ended up in foreclosure from 2000 to 2007 had been sold for less than $100,000, according to a RealStats study.

"Even though we've had a spike in foreclosures, I don't believe that things are as bad here as we read about in other parts of the country," says Daniel Murrer, vice president of RealStats. If they were, Murrer notes, home prices wouldn't be going up.

Unlike in, say, Colorado, California and Florida, the Pittsburgh real estate market hasn't seen major peaks and valleys. "We just have a slow and steady market," Murrer says.