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Old 09-16-2010, 09:51 PM
 
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An article I read today says The Vue condominum project is complete and people will soon begin moving in. I remember reading that many of the original purchasers were not going to close since the values had dropped so much. I would think it would be impossible to get financing on one of those units in this market.

I checked MLS and found only 32 condo sales in all of downtown Charlotte in the last 3 months and only 8 in the last month. What do you think is going to happen to this project? Will it be foreclosed on and the units rented?
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Old 09-16-2010, 10:10 PM
 
Location: Charlotte, NC
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I went to their website, only $400,000 for a whopping 1 bedroom condo. Good luck with that boys.
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Old 09-17-2010, 06:24 AM
 
Location: East Lansing, MI
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Quote:
Originally Posted by Charlotteborn View Post
...Will it be foreclosed on and the units rented?
Why would you jump to this conclusion? Do you have any stats on how many units are purchased/under contract?
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Old 09-17-2010, 07:16 AM
 
Location: South Charlotte
1,435 posts, read 5,229,486 times
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They restructured the loan about a year ago and laid out a time table for sales for the developer.
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Old 09-17-2010, 07:40 AM
 
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When they restructured the loan I figured it was with the idea to give the developer time to finish and try and market the property as best possible all with higher scrutiny from the lender who is BoA in large part I'm not mistaken. BoA didn't want another Park disaster esp. right outside its window. Also, believe the foreclosure or deed in lieu was at least outlined at that time, but its in everyones best interest to not further distress the property.

Renting it out ala the Catalyst is not an option due to the higher end finishes I would think.
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Old 09-17-2010, 08:04 AM
 
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Default Long winded thoughts

I think that the Vue is an interesting case study for the uptown market. The developer says has said over the last 3 years that anywhere from 50-60% of the units are presold. However that number hasnt changed for over 2 years so at best the presales have been extremely slow recently. Deposits were only 10% for most of the units (they may have been closer to 20% for some of the high end units). Which means that while it hurts from an investment standpoint if the price has dropped more than 10% from your contract price it makes sense to either walk away or renegotiate (it is important to note that earlier preconstruction prices were 10-20% cheaper than the prices currently listed by the developer).

The thing to worry about with the Vue is what happens if only 50% of the people with deposits close (which I personally think is aggresive). You would have a 25-30% occupied building. Which means a huge carrying cost for the developer in terms of HOA costs in a very bad sales market. Additionally you run into uncertainty on whether the building would qualify for Conforming mortgages or FHA loans based on stricter condo lending rules from the Miami debaucle (please correct me if I'm wrong and the building has gotten approval for government guarenteed mortgages). The last question is appraisals and whether the appraisals will come our high enough to support the mortgages which I havent heard happening yet... whenever you hear a developer saying we'll go to as many appraisers as we need to until we find one that works I start getting really nervous.

The final issue which is why the rest of these problems come up is whether the valuation is realistic on the view, you are talking about $450-$600+ per sq foot cost at the Vue. The prices you are seeing at its closest comp Avenue are $250-$350 per sq foot. So while people are saying it is a "unique" product that type of talk has gotten a lot of people into trouble recently with real estate.

Personally I like the idea of uptown living, I think the Vue is a great property, but there is no way I take the risk of a 20% filled new condo tower with HOA fee issues in a stagnant real estate market, true I may miss out on a chance at living in a great condo and prices may move up 5-10% over the next couple years, but better that than risk the Vue selling at $250-300 per sq foot (which I think is quite possible if sales struggle) and the nightmare that has played out with a bunch of unfilled condo towers in other markets
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Old 09-17-2010, 08:07 AM
 
716 posts, read 1,360,566 times
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Quote:
Originally Posted by topchief1 View Post
I went to their website, only $400,000 for a whopping 1 bedroom condo. Good luck with that boys.

Yes and what happens if and when real estate drops further? I would hate paying 400k now and then selling for 200k or even 150k 3 years down the road.
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Old 09-17-2010, 08:23 AM
 
Location: Wouldn't you like to know?
9,114 posts, read 15,676,091 times
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Quote:
Originally Posted by CharlotteJW View Post
I think that the Vue is an interesting case study for the uptown market. The developer says has said over the last 3 years that anywhere from 50-60% of the units are presold. However that number hasnt changed for over 2 years so at best the presales have been extremely slow recently. Deposits were only 10% for most of the units (they may have been closer to 20% for some of the high end units). Which means that while it hurts from an investment standpoint if the price has dropped more than 10% from your contract price it makes sense to either walk away or renegotiate (it is important to note that earlier preconstruction prices were 10-20% cheaper than the prices currently listed by the developer).

The thing to worry about with the Vue is what happens if only 50% of the people with deposits close (which I personally think is aggresive). You would have a 25-30% occupied building. Which means a huge carrying cost for the developer in terms of HOA costs in a very bad sales market. Additionally you run into uncertainty on whether the building would qualify for Conforming mortgages or FHA loans based on stricter condo lending rules from the Miami debaucle (please correct me if I'm wrong and the building has gotten approval for government guarenteed mortgages). The last question is appraisals and whether the appraisals will come our high enough to support the mortgages which I havent heard happening yet... whenever you hear a developer saying we'll go to as many appraisers as we need to until we find one that works I start getting really nervous.

The final issue which is why the rest of these problems come up is whether the valuation is realistic on the view, you are talking about $450-$600+ per sq foot cost at the Vue. The prices you are seeing at its closest comp Avenue are $250-$350 per sq foot. So while people are saying it is a "unique" product that type of talk has gotten a lot of people into trouble recently with real estate.

Personally I like the idea of uptown living, I think the Vue is a great property, but there is no way I take the risk of a 20% filled new condo tower with HOA fee issues in a stagnant real estate market, true I may miss out on a chance at living in a great condo and prices may move up 5-10% over the next couple years, but better that than risk the Vue selling at $250-300 per sq foot (which I think is quite possible if sales struggle) and the nightmare that has played out with a bunch of unfilled condo towers in other markets
Why do I feel like The Vue is going to end up like this?.....

Ft. Myers, Florida Condo Tower Has 1 Tenant, 32 Stories
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Old 09-17-2010, 08:52 AM
 
2,840 posts, read 4,160,782 times
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Originally Posted by hooligan View Post
Why would you jump to this conclusion? Do you have any stats on how many units are purchased/under contract?
It's just a guess. I can't imagine that a purchaser that agreed on a price based on 2007 values would agree to follow thru today. Even if 50% of the units were 'under contract' before the recession - who in todays market is going to be able to get financing? Seems to me that is going to leave alot of empty units......
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Old 09-17-2010, 08:57 AM
 
Location: Lake Wylie, SC
622 posts, read 1,587,805 times
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Here is an interesting blog that I have been following about The Vue.

VueCharlotte Buyer's Blog | Vue Buyers Have Come Together
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