Seattle, Manhattan Condo Markets Squeeze Developers [Housing Tracker]

Quote of the Day

"It's like a dating service for home sellers. We're bringing people together." - Greg Holt, CEO and co-owner of Denver-based Pad4Pad, one of many online home- swapping services that have proliferated during the housing slump. (LA Times, June 29^th)

House Sales/Price Trends

It’s Splitsville.  “A WCI Communities [study] found that boomers are buying second homes at younger ages (47, on average)… and visiting them more frequently… than their parents did … Many forecasters expect the movement to grow, as more boomers become empty nesters. National Association of Realtors: 7% of baby boomers already own a vacation home, and some… expect that number to exceed 20% within a decade, [especially with]  for sale signs multiplying in many resort towns... The ‘splitter’ trend is driven by at least three forces. Technology… the changing nature of jobs (more boomers are self-employed)… or travel frequently, [and] the decline in travel costs.”  (Newsweek, July 1^st)

Carolina and Gulf Coasts Remain the Strongest Housing Markets.  “The rapidly growing resort and retirement centers along the Carolina coast continue to have the most intense housing development in the US. This is followed closely by the hurricane rebuilding region on the Gulf Coast, including Houston and the manufacturing and business centers in the North Carolina Piedmont area plus Austin, Texas… Residential construction continues to sink rapidly in the most overbuilt housing markets experiencing 20% declines in home prices… New home demand is [also] being restrained by shrinking contractor margins from an abrupt jump in building cost and a jump in mortgage rates.”  (Reed Construction Data, July 1^st)

Condo Developers Told: Pay More Of Renters' Costs.  “The Seattle City Council voted 8-0 to increase the amount of relocation assistance that developers who convert apartments into condos pay, from $500 to three times the monthly rent, for tenants making 80% of local median income or less… Developers [will] pay more relocation help to some elderly tenants or others with special needs… The council also gave developers a break Monday: They would more easily qualify for an affordable housing tax break by including condos or apartments affordable to moderate-income residents under another measure approved by the council.”  (Seattle P.I., July 1^st)

Megahomes: Seattle Wants To Limit Sizes.  “After years of complaints about suburban-sized homes that devour lawns and encroach on neighbors, the Seattle City Council plans next month to consider limiting the size of some larger homes in single-family neighborhoods… In the last five years, Seattle has issued more than 1,200 demolition permits in single-family neighborhoods. While some may be for garages or sheds, many are for tearing down homes likely to be replaced by something bigger. So far this year, 113 permits have been issued, a slower pace than the previous two years.”  (Seattle P.I., July 1^st)

St. Paul's Penfield Condos Canceled.  Minnesota: “The Penfield, an upscale condominium project that was to be downtown St. Paul's first residential high-rise in more than 20 years, is the latest casualty of the condo market meltdown. "We have stepped back from the project and will not be doing condos," said Jim Rutzick, a partner in St. Paul-based Sherman Rutzick & Associates, which was developing the 33-story tower. He said the developers expect to have a new development plan for the site at 100 E. 11th St. Rutzick said that only about 80 of the project's 313 condo units were presold.”  (Minnesota Star Tribune, July 1^st)

Down Market Gives Rise To Home-Swap Deals. “For years people have been swapping homes for vacations. Today, the idea of permanent exchanges is gaining support among disillusioned property owners struggling to sell in a glacial real estate market. Although the number of completed trades isn't being tracked… several home-swap websites have sprung up in the last year and now claim close to 40,000 combined swap listings nationwide. Others appear regularly on Craigslist.org… Although swap listings [are] a small fraction of total property listings, website operators are confident they have hit upon a simple way to help ease today's market woes -- matching buyers and sellers.”  (LA Times, June 29^th)

Condos On The Chopping Block.  NY: “Developers are clamoring to move new development condo units… Price cuts are outpacing price increases, and prices appear to be falling on the whole in… Manhattan (particularly in Harlem) and much of Brooklyn… Data showed that 54% of Manhattan listings that saw a change in price had dropped their prices in [Q2], and 64% of Brooklyn properties that had fluctuating prices cut theirs. Although the actual average price changes in Manhattan were about three-and-a-half times more than the changes in Brooklyn… where prices are lower, the average net price change was comparable at -$15,362 in Manhattan and -$14,516 in Brooklyn.”  (The Real Deal, June 30^th)

 

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Comments

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WCI is on the verge of bankruptcy.