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My kids moved with their mother from the NY metro area down to the Charleston area back in '98. I remember the old bridges and 17 through Mt. Pleasant past Boone Hall and North. There was NOTHING there. Well, that's not really true, but damn, how much has changed in 12 years??
I've been coming here several times a year since then, and have seen it just explode. It's kind of nuts. What I'm wondering is this. How does this growth sustain? Driving around downtown, coming off the bridge, I drive through one of the most depressed ghetto areas I've ever seen, and in about 2 seconds I'm driving past the Cigar Factory Lofts which go for $1.2 millon!! WTF??? Lofts in Los Angeles are half that! Where is all this money coming from? Does CHS have the economy of LAX?? What about the 20% population living in poverty?? Something doesn't add up.
Those Cigar Factory lofts are not going so well. The lender pulled the developer's financing. And I am not certain if the Bristol & a couple of the other downtown condos ever truly sold out. I remember seeing a fabric banner hangign from the buildign with pricing- thats were I realized RE was about to dive. You don't advertise a high end property with a banner that includes pricing.
Well, in a small city you generally have a limited number of gazillionaires. Maybe Charleston is different and has large money tree somewhere. Traditionally, lofts were homesteaded in bad neighborhoods in large cities by starving artists squatting abandoned factories where nobody would ever want to live. Now the developers come in, renovate and offer the "starving artist experience" for lots and lots of money. Not sure who the market is for that down here.
They tried this in LA. There is a big downtown area that has been largely ignored since they tore up the public transportation infrastructure back in the 40's/50's. It's actually quite beautiful, but pretty much populated by transients. There's also an industrial area close by. Now, who goes to sunny SoCal to live in a depressed, urban jungle? Nobody, apparently. The loft conversions in downtown LA are a mess. Tons of inventory sitting, or being auctioned off. Stupid developers.
Charleston is a town with a tremendous amount of old money.
New money trickles in down there.
And while the tourism has done better then some States, the area has taken a
hit.
The higher end marketplace (>$750K) is pretty flat due to 1) unrealistic sellers, 2) huge oversupply, 3) a lack of buyers at current prices and 4) tighter lending standards.
With rising interest rates over the last month (1 point), my guess is sellers of these high end homes have taken another 10% hit in value in the short term.
Buy the price not the rate....unfortunately, those who don't understand simple supply and demand are the same ones who don't understand this either.
If you compare apples to apples, you would see the price comparison between the Cigar Factory lofts and comparable lofts in LA are strikingly similar.
1.2mil at the CigFact buys you 3br/2.5ba and nearly 2300sqft. You say that a loft in LA costs half that...well, sure it does...if you're looking for a 1br/1ba with 500-1500sqft.
I'm not defending Charleston prices. Heck, I think they are outrageous. I'm just keeping it real and calling out the bad information spelled out in the original post.
Charleston does not really have as many local high earners as people assume. We have a large number of retired and semi-retired (ie still working but have banked large $ elsewhere.) We also have a large number of second homes downtown and on the islands.
I think most of the condos were overpriced from the start. It boggles my mind to think of the number of people who purchased properties simply as a comodity.
Quote:
Buy the price not the rate....
Most people I know pay the payment. They see what the lender says they can afford at the desired payment and buy accordingly instead of asking if the house is worth that amount in the first place. To be honest for the last ten years most of us knew we were overpaying but it seemed fine since everyone else did as well.
If you compare apples to apples, you would see the price comparison between the Cigar Factory lofts and comparable lofts in LA are strikingly similar.
1.2mil at the CigFact buys you 3br/2.5ba and nearly 2300sqft. You say that a loft in LA costs half that...well, sure it does...if you're looking for a 1br/1ba with 500-1500sqft.
I'm not defending Charleston prices. Heck, I think they are outrageous. I'm just keeping it real and calling out the bad information spelled out in the original post.
Have a great day!
Hey man, ya got me! I should have said 3/5th as much, but you know, that doesn't sound as impressive as half...
I mean, Cigar Factory is $521/Sq. Ft. (half of which is $260.5/Sq Ft.).
and you can ONLY get a pitiful little 2 story 1523 Sq. Foot 2+2 for $469K OR $307.00/Sq. Ft. (http://losangeles.craigslist.org/lac/reb/2114824988.html - broken link) in downtown LA.
You know, an actual city.
With jobs and stuff.
Yeah, I guess that less than $40/sq foot I added on was really really exaggerating. Thanks for "keepin it real".
hudster you are just illistrating the exact reason why the Cigar Factory project has failed, they are way overpriced for what they are offering. We stopped by there when they were in the beginning stages jut to take a look around and I told the DW then that the place would never get completed at that price.
Yea, La Jolla California is around 450/sqft...Charleston is relatively over priced.
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