Thanks to the three folks who wrote in this weekend. Here’s a collection of what they sent out plus a few extra links.
- Mose calculates the average days on Redfin for Seattle condos is 92 days.
- Our spy at Mosler snuck into the penthouse and took some photos. Here’s what they thought:
I’m not sure if it is schuster’s unit - he bought one of the units but I’m not sure if it was this one. It’s the only one with a second level although I have to say I was pretty unimpressed by the mezzanine where I came in. The view was hot though and 20′ ceilings don’t hurt either
- Rent at Trace for only $1800. Strange it took this long to come on the market.
- EconE details Vulcan vs. Flipper
- Jesse at Vintage Seattle does a photo shoot at Trace
- DanC writes in about a NYT article, Like Subprime Mortgages, Some Construction Loans Are Delinquent
- Elizabeth Rhodes answers a question about pets and condos
- Aubrey notices where the condo ad dollars are going. Answer: New Yorker ads.
- Monica wonders why condos are always the bad guy?
- Trio unit #323 didn’t sell at its 10% reduction. The price is now $480k from $440. Guess they forgot to update the marketing text though, “* TRIO 2BD Home Of The Week * Hurry - this special pricing is for 1 wk only! 10% Reduction!”.
- Update on Madison Lofts:
Prices for these homes should be available in January 2008 and sales will likely start in February 2008.
- Ben has posted a November 2007 condo market update. “Buyers are still buying and sellers are still experiencing value appreciation.”
Popularity: 37% [?]
15 responses so far ↓
1 Chris // Dec 11, 2007 at 11:24 am
huh. That trace unit is nice. $1800 per month, or $2.25/sf, seems fair for that neighborhood. Only issue is its a large 1-BD (or loft equivalent) right? Most new apartments seem to be going large (2 person) or small to hit rental price points. What’s the likely discount to mortgage, tax, HOA, etc this owner’s receiving?
2 Matt // Dec 11, 2007 at 4:53 pm
It’s unit #206 and sold for $339,031.19. HOAs are $300 a month.
3 Peckham // Dec 11, 2007 at 6:24 pm
“What’s the likely discount to mortgage, tax, HOA, etc this owner’s receiving?”
“sold for $339,031.19. HOAs are $300 a month”
IOW, it’s going to lose money as a rental. I wonder what crackpot dreamed up that business plan?
4 Bob // Dec 11, 2007 at 7:54 pm
That Trace unit has been lowered to $1725 already.
5 tomasyalba // Dec 12, 2007 at 6:46 am
Sign o’ the times? With evidence of owner desperation, a prospective renter needs to find a way to project the odds of short sale or foreclosure, and price that risk into the lease. Renter needs to get some financial disclosure from the landlord, and get some stiff renter-protection clauses in the lease.
6 Dan C. // Dec 12, 2007 at 9:06 am
I believe that as a renter (not sure on this!) you are entitled to the term of your lease, even in the event of a foreclosure or bank sale. Once that year period is up, you are out of there, but the bank cannot cancel a legal contract. Anyone got clarification on that?
I don’t believe this would apply to a building-wide construction loan foreclosure (happening all over the place right now…scary stuff for owners!)
7 Matt // Dec 12, 2007 at 9:13 am
I think they dropped the price too quickly. I heard last night that #304 rented for $2000/mn (though it has a view but no terrace) and that #303 rented for $3000/mn (smaller than 304 but apparently had ~$30,000 worth of furniture/renovations put into it.)
8 Chris // Dec 12, 2007 at 9:32 am
“(happening all over the place right now…scary stuff for owners!)”
Dan C., by all over the place, you don’t mean in Seattle do you? I’ve been reading about increasing c. loan foreclosure nationwide, but I can only think of one of maybe two projects here that are likely candidates? w/o disclosing names, if that is improper, is it prevalent around here now? what types of projects?
9 Dan C. // Dec 12, 2007 at 9:37 am
Yes, sorry, I meant nationwide. Mainly in Miami and Central California right now (surprising?) *See the article I sent to Matt, referenced in this column
You are correct that a couple of local projects (smaller buildings) are having BIG financing problems, I have heard this firsthand.
This issue results in developers foreclosing on the building, leaving the HOA responsible (and in turn a handful of owners)for paying all taxes, utilities and insurance on the building while the bank negotiates a takeover and firesale of the remaining units. This firesale severely impacts the values of already owned units, thereby further screwing those who purchased in pre-construction.
10 tomasyalba // Dec 12, 2007 at 11:04 am
In most states foreclosure voids any lease. Any legal eagles know if it’s different in WA?
11 SayWhat? // Dec 12, 2007 at 5:47 pm
“This issue results in developers foreclosing on the building, leaving the HOA responsible (and in turn a handful of owners)for paying all taxes, utilities and insurance on the building while the bank negotiates a takeover and firesale of the remaining units. This firesale severely impacts the values of already owned units, thereby further screwing those who purchased in pre-construction.”
This does not make sense. How is it possible that a developer could foreclose on his/her own project? A condominium is not turned over to the HOA from the declarant until the vast majority of units are sold and closed. Although its not likely, a lender could foreclose on the developer at any given point, but that lender would immediately assume the role, rights and responsibilities of the developer and would make damn sure that the remaining units are sold post haste and that there is no interruption in schedule in order to protect their investment. Of all the things to worry about, this would be very unlikely and almost unheard of - in Seattle at least.
12 Dan C. // Dec 13, 2007 at 7:51 am
Developers foreclose on projects ALL of the time, from residential to retail to commercial to industrial…I don’t know what you mean by that.
It is happening right now at two condo complexes in Seattle (I believe this has been resolved very recently). Residents have received notice of utility shutoff due to amounts past due on both electricity and water. They are responsible for paying the balance, as the developer has gone bankrupt and the utility company is collecting, regardless of the situation.
When a developer (construction loan holder) is still completing a building, they are responsible for paying utilities and taxes on the property and collecting the amounts due from current owners, until this responsibilty is turned over to the HOA (>90% sold I think?). In the cases I am speaking of (one right in Fremont), the lender had not yet assumed responsibilty, as the proceedings were still in bankruptcy court.
13 jo // Dec 13, 2007 at 9:12 am
http://en.wikipedia.org/wiki/Fear_mongering
The object of fear is exaggerated; those the fear is directed toward are kept aware of it on a constant basis.
14 Chris // Dec 13, 2007 at 9:30 am
“Of all the things to worry about, this would be very unlikely and almost unheard of - in Seattle at least”
Ignorance is bliss, eh? I’m a big fan of urban development and thus I follow the condo/rental market closely. Blogs like this one - and this one maybe the best condo blog- help disseminate information that may be helpful to people. At times, some information may seem to some as “fear mongering” when in fact it is not. Dan C. is just pointing out a risk that exists in new construction, a risk that may be neglible in a robust market but real in a more topsy turvy market, to put it gently, that we have now.
15 Dan C. // Dec 13, 2007 at 9:57 am
Chris,
Thanks for the support. I am not trying to spread “fear”. I would hope that as a consumer of a product (in this case, condos) someone would want to be aware of all risks involved, whether far fetched or not. You would like to know that your car has airbags right? Even though you HOPE that you never have to use them…
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