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July 2010

Decomposing the Condo Bubble

Came across this interesting article in the Wall Street Journal on why the country built so many condos during the boom a few years ago.  E.g., one stunning stat was that Las Vegas may have a 20+ year supply of unsold units. 

Ultimately, my takeaway is that like any product, there isn't limitless demand for condos and it's easy for investors and developers (not to mention realtors and bloggers like me back in the heyday) to get ahead of themselves -- especially if supporting trends seem to corroborate the enthusiasm.  The key here is that legitimate demand drivers like empty nesters, density, pent up demand, millennials, immigration, etc. are all valid but the supply can't dwarf the demand.

Urban centers will continue to represent an important, if comparatively small, part of the rapidly evolving American landscape. With as many as 100 million more Americans by 2050, they could enjoy a growth of somewhere between 10 million and 20 million more people. And in the short run, the collapse of the high-end condo market could provide opportunity for young and unmarried people to move into luxurious urban housing at bargain rates.

But lower prices, or a shift to rentals, could prove financially devastating for urban developers and their investors, who now may be slow to re-enter the market. And for many cities, the bust could represent a punishing fiscal blow, given the subsidies lavished on many projects during the era of urbanist frenzy.

Full article here. 

USA Today Highlights Seattle as a "sound" Investment?

South lake union

This USA Today article feels like part advertisement for SLU but I suppose anytime a major newspaper has nice things to say about our fair city, who should complain?

Interestingly enough, it's not called out as an advertisement at the bottom.  It says "Special for USA Today." The one thing that might give it away is the claim that South Lake Union is "hip."  Maybe it's my Belltown almunae status but I don't consider SLU hip.  Maybe "increasingly vibrant" or "on the upswing" but not hip.



Monique Lofts

(Pictures contributed by Joseph Hill and archived under Seattle Condo Gallery)

Monique Lofts is a funky and hip condo in the Pike/Pine District (1024 E Pike St).  It was a warehouse office (1913) and was converted to a loft-style condo in 1999.  There are 24 residential homes in this three-story condo and two commercial spaces on street level. 

The interior has some interesting industrial elements including exposed concrete columns which add some nice accents to the walls.  Heavy wood beams hang across the ceilings, wood floors are throughout the open space and ceiling heights for these homes go as high as 20 feet! The smallest homes start at 467 square feet and the largest one is 1,989 square.

Continue reading "Monique Lofts" »

What were Seattle condo stats in June 2010?

June numbers are in.  Much like May, we definitely saw the impact of the end of the federal tax credit program.  Here are some tidbits that are worth noting:

  • Pending sales were 30% lower than June 2009.  Believe it or not, this was better than May 2010 which was 40% lower than May 2009.
  • Closed sales were up 11% versus last year and prices held steady -- up 1.8%.
  • The winner for most resilient neighborhood in Seattle: Belltown/Downtown.  Despite the lack of tax credits, Belltown/Downtown was the only Seattle neighborhood with positive year over year June pending sales.