Posts tagged 22902 condos

Charlottesville Condos – What are Floor Premiums?

What is a view worth? In a lot of ways, a view is unZillowable – how does one quantify a great view?

What is a “great view”? Mountains? Urban life? Both?

Charlottesville has quite a few condos; (for these purposes, we’re not talking about condo conversions which are occasionally challenged). While we obviously have neither the volume, scale, nor heights or prices of New York City real estate, we can draw parallels from their market and analyses.

Starting with the advice given by appraiser Jonathan Miller who explained to Brick Underground:

“how he correlates dollar figures to floor numbers.

“When it comes to floor level adjustments, we separate floor height and view into two separate amenities,” he says. “The floor level adjustment reflects the actual and perceived changes in natural light, street noise and security.”

The adjustment is bigger when comparing a second-floor apartment to a first-floor apartment.

Depending on market conditions, he says, “a typical adjustment might be 1% per floor before considering view differences. That’s 1% of the price of the unit you are comparing it to.”

So – higher is better. Lower is less better. 🙂

Candidly, I don’t think we have the market to allow for application of that type of analysis. For better or worse, the Charlottesville market is one in which “floor premiums per se don’t factor in as much as what the buyer is willing to pay and the seller is willing to accept. I always do a specific data analysis when evaluating condos, but ultimately if the buyer is seeking X and the seller will accept Y, data aside, a meeting of the minds likely won’t be found.

But, I still find the analysis provided by Noah Rosenblatt’s analysis at Urban Digs insightful and potentially applicable to the Charlottesville condo market.

There are two main elements in figuring out what kind of floor multiplier you should use when doing a comps analysis to what hopefully is a same-line sale (same footprint, different floor): TYPE OF CHANGE IN VIEW and AMOUNT OF GAP IN FLOORS.

TYPE OF CHANGE IN VIEW: When comparing two in-building same line comparable units we need to determine the level of change in the view quality. In other words, is there a drastic difference in the view or is there no difference in view? Lets take two hypothetical examples to explain this point:

What does this segment of the Charlottesville real estate market look like? A few examples:

The Waterhouse – still under construction, still not selling as far as I know. But they’re going to be getting another floor, so their floor premiums may go up – as may their prices. I’d wager that per-square-foot these are going to be the most expensive condos Charlottesville’s ever seen. (there’s likely a story or two to be written about this project)

The Gleason – Great condos in downtown Charlottesville, about two blocks off the Downtown Mall

The Barringer – Perhaps the best-located UVA condos.

The Holsinger – located right on the Downtown Mall, among the highest-priced condos in Charlottesville

I’ve represented a couple buyers in the Gleason and have taken a few photos while there.


Which view would you value more?

5th Floor 4th Floor

Hint: the first one is the 5th floor; the second is the 4th.

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City of Charlottesville Real Estate Market Update – First Ten Months of 2011

One big notation: I’m no longer comparing today’s real estate market; what happened in 2005 – 2007 and before is interesting, curious, anomalous and ultimately irrelevant to today’s real estate market. EVERYTHING is different now – interest rates, economic outlook, international economic events, gas prices, employment trends – making comparisons between this market and that market is a distraction.

The City of Charlottesville’s real estate market is unique – its mix of homes – single family, condo, townhouse, the fact that is has a relatively smaller percentage of newer construction and its more dense and urban location make it quite distinctive from the surrounding markets.

First, the bullet points:

Active Listings – Fewer than last year, but still too high.

New Listings – Fewer than the past two years and trending down; this is a very good thing. As fewer houses come on the market, more houses will sell and we’l be able to find our way through the current spate of houses on the market. *

All Pendings (Under Contracts) – Higher than the last two years; this is a very good thing. People are buying real estate.

New Pendings (Better reflecting current market activity) –

Sold Listings – Slightly higher than last year.

I’d love to include the numbers and charts for Days on Market and the List Price to Sales Price ratio, but I have found that the only, only, only way to run these numbers with any degree of accuracy is to do it manually. For specific properties and neighborhoods.

Note also that these numbers and charts are for everything – single family, attached and condos – your market will vary.

* I’m not totally convinced that the houses that are coming on the market in the Charlottesville and Albemarle real estate market are the ones that buyers want to buy – whether size or energy efficiencies, I think that the inventory we’ve seen over the past 18 months has not quite matched to what buyers want, and this is a reason that we’ve seen the new construction market in the Charlottesville area do so well.



Now, the charts and graphs …

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More Condos coming to Belmont – The Coal Tower Project

When following the links below, keep in mind two things: 1 – If you don’t own it, it’s going to change (one of the most common things I tell my buyer clients 2 – Growth and development moves interminably slowly; only journalists and lobbyists seem to be able to effectively track said progress.

… Plans call for a mixed-use project, with 64 townhouses (four above a parking structure), 118 condos, and a commercial segment that includes restaurants and retail on 2.77 acres of the site, Creasy says.

… The coal tower, a longtime landmark, is now becoming a focus of residents’ worries about connectivity, traffic and an altered skyline as it moves closer to redevelopment at the hand of Coran Capshaw.

… As an aside, cvillenews pointed out in 2006 how there was going to be a green condo construction project ,* which I noted in 2007 briefly in my Belmont neighborhood story .

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Three Charlottesville Neighborhoods – Thanks to USA Today

The biggest draw is Keswick Hall, a 600-acre gated community that is home to the Keswick Club with an Arnold Palmer-designed golf course, an Orient Express hotel, and the Estates at Keswick Hall, 124 home sites ranging from 2 to 8 acres. … Anchored by a large pedestrian mall and walking distance of the University of Virginia, downtown is suddenly hot, with many new condos to choose from. … “This is probably the most popular second-home area right now, with everything from condos and townhomes to detached single family homes,” says Mailloux. … One appeal for second-home buyers is that maintenance fees include “everything down to the landscaping and lawn care,” with about 150 houses and condos from $500,000 to $1.2 million.

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