Atlanta condo demand 'evaporated' (sales, real estate, 2009)

[Atlantasfinest]

Interesting article on Condominium demand in metro Atlanta which has "evaporated" in the second half of 2008, making 2009 a "pivotal year" for developers and their lenders.

I wonder if these builders going to convert these buildinds into apartments once they are completed then wait for the market to turn around to sell them? I specifically remember City View Lofts on Freedom Parkway and Blvd. starting off as rentals for a few months but when the Atlanta condo market went crazy they immediately started selling them instead.

Interested In hearing peoples thoughts on this bleak outlook...


Atlanta condo demand 'evaporated' - Atlanta Business Chronicle:

[coolyfett]

Wouldn't that mean that more people can afford to live closer to the urban core? That is what I am taking from this.....

[RZaakir]

You would think that cooly but I know of a few developments that shall remain nameless that are stubbornly holding onto ridiculously high prices. I don't know if they are trying to weather out the downturn or what but they appear content to not move units even as demand gets softer and softer.

[coolyfett]

Interesting, the urban core is my ultimate destination, and hopefully I can be there by 2012. I don't know all of the neighborhoods, I am still reading, listening & learning about Atlanta. If you are smart and focused you can live in this city with out using an automobile, which is apart of my long term plans for living here. If they want to keep them condos, that is fine by me. As long as I am near the heart of the city Im in paradise.

[BobKovacs]

Originally Posted by coolyfett

Wouldn't that mean that more people can afford to live closer to the urban core? That is what I am taking from this.....

If that was the case, the condo sales numbers would be improving- not declining. More people can't afford to live in the city, because while prices may have dropped a little, the drops don't make up for the much stricter lending requirements. The people who were getting zero-down no income verification, interest-only loans can't do so anymore, so that reduced the pool of eligible buyers. Now that these folks have to actually be able to qualify for- and afford- their mortgages, they're having to buy less expensive properties, if they can buy at all.

[Georgia]

Think there are few root causes.
1) Fees. I was looking at the Urinal and Constipation Sunday Real Estate Section with condo's advertised. Prices were reasonable but geez, some of the fees. Seen items with monthly association / condo fees in excess of $500.00 per month! Who wants to pay that, if you do you better get a pedicure every Sunday with a massage from either Thor or Kitty inclusive of a happy ending
2) Taxes. The increasing property tax rate thanks to Super Mayor can be turning folks away.
3) Chance. Isn't the builder of Twelve under a class action with sales under false pretence? Something about folks dropping a half mil. on their condo with a supposed view of the skyline and mountain scape, only to now be looking at concrete from the new building slapped up across the street.
4) Crime issues. Now this comes from a friend trying to sell his Atlantic Station Condo. I think this area became victim of the Ninja loan and Fannie/Freddie Barney Frank scandal. He has stated that though the economy is bad many of the foreclosures were welcomed, now it is the cost to repair and resale at auction.

Now, for the other side of the coin on this issue. The city population has increased by 50K over the last 5 years. Where are these folks moving?

[noah]

I think part of it is people want a bigger house and aren't willing to sacrifice space. Obviously Midtown for instance is very expensive unless you go the condo route and many people want a house. Its not just condo sales but also home sales. I think home sales in the suburbs are much worse then condos in-town. While demand is down now with all the plans in midtown I think long term the condos will sell as many people want the lifestyle.

Originally Posted by BobKovacs

If that was the case, the condo sales numbers would be improving- not declining. More people can't afford to live in the city, because while prices may have dropped a little, the drops don't make up for the much stricter lending requirements. The people who were getting zero-down no income verification, interest-only loans can't do so anymore, so that reduced the pool of eligible buyers. Now that these folks have to actually be able to qualify for- and afford- their mortgages, they're having to buy less expensive properties, if they can buy at all.

[coolyfett]

Originally Posted by BobKovacs

If that was the case, the condo sales numbers would be improving- not declining. More people can't afford to live in the city, because while prices may have dropped a little, the drops don't make up for the much stricter lending requirements. The people who were getting zero-down no income verification, interest-only loans can't do so anymore, so that reduced the pool of eligible buyers. Now that these folks have to actually be able to qualify for- and afford- their mortgages, they're having to buy less expensive properties, if they can buy at all.

I agree with you Bob, what I meant was, the prices for the locations would eventually drop, making them more affordable. How long would these places remain empty, til they figure out a new plan to fill them?

[FromGA]

A solution: Encourage rental investment in the condos. Professionals / "solid renters" will rent the condos, and investors will buy em knowing they can be rented out. The caps that builders place on the number of rental units is a discouragement. Where did these rules come from?! Is this common in large cities?!

[atlantagreg30127]

Originally Posted by Georgia

Think there are few root causes.
1) Fees. I was looking at the Urinal and Constipation Sunday Real Estate Section with condo's advertised. Prices were reasonable but geez, some of the fees. Seen items with monthly association / condo fees in excess of $500.00 per month! Who wants to pay that, if you do you better get a pedicure every Sunday with a massage from either Thor or Kitty inclusive of a happy ending
2) Taxes. The increasing property tax rate thanks to Super Mayor can be turning folks away.
3) Chance. Isn't the builder of Twelve under a class action with sales under false pretence? Something about folks dropping a half mil. on their condo with a supposed view of the skyline and mountain scape, only to now be looking at concrete from the new building slapped up across the street.
4) Crime issues.

You left one out - with "furloughs", you can expect oh, maybe a 15+ minute wait for a fire truck to get to you if your place gets on fire, and if the trend continue, how long for the police?

Living on the 35th floor of a building that's aflame doesn't sound very appealing when I have to take into account that I might have to only rely on the sprinkler system and my own fire extinguisher for help until the fire department gets there (if the 911 dispatcher gets the address right, that is )