Seattle Times, Affordable rentals vanish as apartments go condo:
Renters across the Puget Sound region are feeling a similar pinch. Nearly 7,000 apartments in the area were converted to condos last year.
Few conversions, though, will have as much impact as the one at West Ridge Park.
Hardly an affordable rental, but I hear that my old apartment, The Carroll Apartments, is going condo. Before moving out I explicitly made a point of contacting the owner to ensure they weren’t going to convert because I liked living there so much but alas I guess the temptation is too high.
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12 responses so far ↓
1 Jason // Jun 10, 2007 at 7:24 pm
Is it legally possible for an apartment building to revert from condos to apartments? In practice I’ve never seen this done, except in the (many) cases where a $1000 apt becomes a $400k condo which becomes a $1500 apt leased by its individual owner.
2 EconE // Jun 10, 2007 at 7:34 pm
Maybe she should move out of that “high-end” Delridge location and get something on Phinney Ridge like this
http://seattle.craigslist.org/see/apa/348429782.html
or in Newport Hills
http://seattle.craigslist.org/est/apa/348935653.html
She just doesn’t want to do her homework.
3 Art Vandelay // Jun 10, 2007 at 10:06 pm
Sounds like someone didn’t read the article thoroughly. She needs to stay in the same area to be near her job and so her daughter can continue going to the same school.
4 Matt // Jun 10, 2007 at 10:40 pm
Apparently there is a building in Bellevue that was built as condos, they sold a few but the market softened and the rest were turned into apartments. Now the few who do own are unable to sell because no bank will finance the purchase of a condo in a building made up of apartment units. One of these days I’ll spend some time tracking down this story.
5 EconE // Jun 11, 2007 at 1:19 am
No Art…I read the article quite well. I remember Delridge from the 90’s. To say that it has gone from “sleepy hollow” to a gem in the rough is a joke. More like slum to ???
A Home Depot and an All Star Fitness hardly qualify a neighborhood to be considered “gentrified”…after all…where’s the Whole Foods and Starbucks? Aren’t those the true prerequisites? ;o) Down in Los Angeles they say that Watts has “gentrified”. Would you buy a house there? Drive through sometime…let me know what you think.
I just thought that maybe she might want to have her daughter in a better school district (Bellevue) and that her job would be easily replaceable. How much does the Y pay anyways? Sure…I’m sure she “feels good” about working there as it is an honorable job. Are there no jobs like that in other areas?
She is whining about not finding something and is nothing but a cherry picked story for the RE section of the Times…so…if she wants to stay in the “hood”…then here you go.
http://seattle.craigslist.org/see/apa/347922417.html
6 jasonC // Jun 11, 2007 at 7:02 am
Although this isn’t really what the article was getting at directly I often find myself defending the current trend of condo conversions on Capitol Hill. I’ve living on the Hill as an owner and renter for eight years. Often these rental “affordable gems” of apartment living are affordable because the owner/landlord isn’t giving them the care, TLC, and upkeep they need. Eventually the repair and restoration costs climb so high the owner sells, the building is torn down, and the replacement is–guess what?–a condo bldg! Only now its a generic, cookie-cutter monstrosity. I’d rather see the cool old buildings that make Cap Hill unique saved–even if they become “yuppie condos”–than disappear.
7 chris // Jun 11, 2007 at 9:22 am
This story is overblown. Once rents rise - or prices fall - and we have a better equilibrium there will be less conversions. Oddly enough mnay buyers just don’t get the economics of conversions. I was checking out the Decatur and the guy touring the unit with me wanted to buy one an rent it out “as an investment.”…if it was worth so much more as a condo than as a rental (generally x2 to make a conversion work), why in the world would you try to make debt service at the higher value renting it?
8 richard // Jun 11, 2007 at 10:59 am
Delridge gentrified? I was down there a few weeks ago and ended up driving all the way to Westwood just to find a bank ATM. In 80 blocks I didn’t pass a single grocery store. Tons of new construction townhomes popping up though.
9 mhays // Jun 11, 2007 at 4:05 pm
Rents are rising quickly, so the invest-to-rent idea isn’t so farfetched. Especially since the concept involves long-term ownership.
Even if you can’t cover your payments initially, you probably will in a few years, and you’re probably earning a little equity even initially. Though I don’t think you can write off your mortgage on an investment property.
I’ve been thinking vaguely about renting my existing unit out when my new one is complete. My preference pendulum is on the “no” side right now but not overwhelmingly. It sure would be tight for a few years, until my salary and rents grew a little.
10 JDP // Jun 11, 2007 at 8:04 pm
Well it sure was a great article, I grew up in West Seattle and am intimately familiar with Delridge. A lot of new construction townhomes does not equate to Gentrification, Delridge will always be a challenge, but those are the neighborhoods with the cheap rent and with the cost of building new and land so high, the parts are worth more than the whole. I would really like to know why the “Y” is an honorable job, I thought most jobs were honorable, I guess that is my age showing. When I was making $1.65 per hr in 1975 and my rent was $145 per month it wasn’t much of a story. I was told by a relative not to buy a house for $22,000, it was way more than the $7000 he paid, now that house is $320,000; and everyone thinks rising prices are new.
11 Phil // Jun 12, 2007 at 2:50 pm
Rents seem to be returning to what they were in 2000. Just got my first rent increase in the 4 years of living in my current apartment. Craigslist seems to have plenty of listings across all price ranges.
Even though conversions take units out of circualtion for a short while, expect rentals to free up as the converted condos are filled.
12 jcricket // Jun 16, 2007 at 12:43 pm
Matt - The situation you described is pretty rare. Most condo contracts have an “out” for people if the building turns apartment before full occupancy (or whatever the term is) - for precisely the reasons you outlined (impossible to sell a condo in a building that’s otherwise all apartments.
As an example, some friends of my parents were recently in a similar situation. They put down a deposit on a condo building in downtown DC. The market dropped so much that the builders decide to turn the building into apartments. My parents’ friends exercised the clause in their contracts to exit, and even got their deposit back.
Anyone signing a condo pre-sales agreement these days (with the market so wishy-washy) should look to see if there’s a similar “out” clause - otherwise be prepared to either live in a building full of renters or at least lose your deposit when you bail.
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