Condos in CharlAlbemarle

Condos, condos, condos. Condos have been a major part of the market in CharlAlbemarle for the past several years. As readers know, I use other markets as bell-weathers for the Central Virginia market – what does the cancellation of two DC condo projects relate to ours?

Active Condos in CharlAlbemarle 2001-2006 (blue is 2006, pink is 2005)

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This article from the WSJ is worthwhile:

“I knew we were in trouble when the guy who delivered my television a few weeks ago said he had bought two conversions [in the area] and was trying to flip them,” says Kolter chief operating officer Peter Donnantuoni, pinning most of the blame on speculators for driving up prices to unreasonable levels.

Sold Condos in CharlAlbemarle 2001-2006

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Data Source: CAAR MLS

Compare today’s analysis to one just a few months ago in the DP with this telling quote:

In addition to the first-time buyer trying to get his foot in the door, a sizeable portion of investors or “amateur landlords,” retirees and recent transplants help fuel the condominium market …

There are an awful lot of condos on the market right now – two properties that I am marketing in the Turtle Creek development have been on the market for over two months. They are well-priced in relation to their competition and last year at this time would have sold in less than two weeks. There are now eleven properties on the market in Turtle Creek – a huge number. We are in uncharted waters.

Condo conversions have been a “good thing,” particularly with regards to affordable housing. It seems that a lot of buyers are taking their collective breaths right now.

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4 Comments

  1. TrvlnMn June 13, 2006 at 18:53

    The major issue with Turtle Creek (as I view it) apart from the fact that the next huge condo retail complex will be built nearby (Albemarle Place), is that part of the CC&R’s that says, “No Pets Allowed.” Isn’t it bad enough that it’s shared walls without being treated as if you’re still a renter within your own unit? One of the few CC&R’s I’d really like to see in a Condo complex is “must be owner occupied.” A condo is a bad place to have an amature landlord (for a whole bunch of different reasons).

    I noticed this paragraph in the WSJ article:

    In some cases, developers are selling and renting in the same complex. At the Estates at Stuart, a 237-unit development in Stuart, Fla., nearly half the units, now priced between $166,900 and $402,900, have sold since Philadelphia-based Philadelphia Management & Cos. started selling them as condos last year, with sales slowing markedly in recent months. Now, in addition to a sales office, the property has an on-site leasing office, renting units between roughly $995 and $2,000 a month.

    Didn’t that used to be the case with Turtle Creek? Where a portion of the property was rental and the other portion condos? It used to be the case there when I was younger, but then that was quite a few years ago.

    The thing I was always taught with regards to condo’s is that it’s a great vehicle for getting into the market and building equity, but don’t expect to make a profit when you sell, at least not the same sort of profit you’d make with a stand-a-lone house. Expect break even and get the money you put into it out of it, and if you’re lucky make a small profit. I think the real estate boom of the past few years might’ve skewed everyone’s perspective on what’s realistic, and there will probably be an uncomfortable adjustment period.

  2. Ray Hyde June 14, 2006 at 18:55

    When I got out of my condo I couldn’t sell it at a small profit. I rented it for eighteen months and then sold for almost 50% more than I would have accepted earlier.

    Timing is everything.

  3. Jim Duncan June 15, 2006 at 07:02

    Timing is in fact, everything. The local condo market has been so good for so long (three to four years) that people forget – quickly.

    Turtle Creek’s proximity to Albemarle Place is, I believe, more a benefit than a negative. Being that close to a dynamic development which should have night-life, restaurants, maybe a few jobs should be a good thing in the long-run. But then, what do I know.

    Turtle Creek is still owned in some part by the same developer; he had the vision to 1) build a good, solid product and 2) sell off piece by piece.

  4. TrvlnMn June 15, 2006 at 11:55

    Turtle Creek’s proximity to Albemarle Place is, I believe, more a benefit than a negative. Being that close to a dynamic development which should have night-life, restaurants, maybe a few jobs should be a good thing in the long-run.

    Yeah, I considered that as well. And you’re most likely right. And don’t get me wrong, I like the Turtle Creek Condo’s, it’s a good development. However the “no pets” CC&R’s are a deal breaker.