Posted by: The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

28 responses to “The Human Side of a Condo Conversion”

  1. Ubersalad

    Can we post some positive stuffs, rather than always having “whine” from all corners of Seattle?

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  2. brettro

    I read on Slog that the conversion at Lock Vista isn’t going to happen and the complex has been put back up for sale.

    I think it’s a safe bet that this trend of reversions will continue.

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  3. brettro

    Did i screw up my link? Let’s try this again…
    http://slog.thestranger.com/2007/12/wanna_buy_the_lock_vista_got_32_million

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  4. brettro

    i fail. cut and paste.

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  5. wreckingbull

    While it is sad that Lock Vista is converting, and these folks have to move now, the rest of the story is yet to be told….

    Ballard is absolutely bloated with unsold condos with a massive amount still under construction. Anyone checked in at Hjarta recently? These renters may have some real nice opportunities to rent brand-new condos soon. This exploding inventory and flat-lined sales pace is going to put some serious downward pressure on rents.

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  6. M Long

    “Ubersalad”

    And exactly what part of “Seattle Bubble” sounds like a real estate motivational seminar. This is a blog about negative real estate news because most of the people on this board, like myself, think the real estate industry has become the Amway corporation of the 21st century, and that it has a good chance of destroying millions of Americans. I’m also VERY ANGRY ABOUT IT.

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  7. Ubersalad

    should see downtown Bellevue and the amount of buildings coming out. Bellevue’s price tag is much higher than Ballard, and I don’t see how they can sell these.

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  8. Ubersalad

    There is a million ways to destroy sectors of “American Population”. I mean this blog was great when it was the only one of its kind, now it’s just…

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  9. Scotsman

    Amway destroyed millions of Americans?

    I thought the democratic party got the credit for that.

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  10. Ubersalad

    Alright delete my comments, who cares. This blog went from informative to “same whine, different story”.

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  11. TJ_98370

    .
    In an effort to accommodate Ubersalad’s request for more positive stuff(s):
    .
    Happy Real Estate and Homes For Sale
    .

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  12. Chris

    “Anyone checked in at Hjarta recently?”

    Hjarta has sold 6 of 80 units thru Oct. according to the best data I can find

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  13. AndySeattle

    For what it’s worth I was a ‘victim’ of a condo conversion… I chose to move because the place just wasn’t worth buying. And because the area had so many conversions going on at the time my choices were limited as to where I could rent. So I ended up paying a premium for a piece of crap. I stayed in the piece of crap for the years’ lease and then moved to my present location… Same price, amazing neighborhood, some of the greatest schools in the nation and an easier commute.

    Looking back… I’m glad that I was ‘forced’ to move. And I take great delight in occasionally driving by my old stomping grounds and seeing that the conversion has still yet to complete and they are desperately trying to sell out. Schedenfreude at its best!

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  14. off topic

    i’m sorry, but i couldn’t resist:

    increasingly house-poor americans turn to their 401ks to pay the mortgage and stay out of bankruptcy. we honestly cannot stop ourselves. we are going to use up every last little bit of credit before we give up.

    http://calculatedrisk.blogspot.com/2007/12/consumers-use-401k-atm.html

    what the hell, people? are our lives really so empty that every resource must be tapped to keep up with the jones’? has nobody heard of making a budget and sticking to it?

    this stuff is beginning to make me mad.

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  15. Bellevue Ave

    where is angie? I’m sure she will have something inciteful to say about this.

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  16. TJ_98370

    increasingly house-poor americans turn to their 401ks to pay the mortgage and stay out of bankruptcy….

    Wow! What are these people thinking? Aren’t 401K’s protected from bankruptcy?

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  17. off topic

    i really have no idea why anyone would do this.

    you have to go through a whole “proof of financial hardship” process to get access to the 401k and then you have to pay taxes on it at your incremental rate.

    it really seems like such a bad idea

    then again, most of these people had to make at least a few poor decisions to get to this point

    you’d think that the process of filling out the paperwork would get people to think about whether it is really such a great idea

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  18. explorer

    I too was a condo conversion casualty. I spent all of last summer in a very frustrating search, battlling (not just competing) with others both in the same position– or saying they were for an artifical “edge” that did not hold water, or newcomers with a job/no job, and no place yet. There were 50 people lined up for an open house lasting 30 minutes last August at my current rental. I learned to despise any landlord that uses a lease from the Rental Housing Assn. of Puget sound, for good reason.

    I was very fortunate to find a place in the same neighboorhood, where the rent was fairly reasonable for what you get and in the current market. And it’s a triplex nest egg for a California couple/owners. Renters were treated like unwased surfs, regardless of income or history. And contemptable so.

    My short term consolation is also the fact that only three out of 14 units converted have sold. The rest are definately on the road to repartments, at certainly much higher rents that what I am paying now, for less space and ameniteies.

    Barring rent control, It is karma in a way for speculators and the greed that has been going on in the rental markets in-city especially over the past 3 years.

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  19. TJ_98370

    An interesting recent development:

    Ben Must Be Worried

    …At least Congressman Vito Fossella of Staten Island is thinking straight.
    ..
    Earlier this week he proposed allowing homeowners with adjustable-rate mortgages who are facing interest-rate resets to withdraw up to $25,000 penalty-free from their retirement accounts to avoid foreclosure…..

    .
    Apparently, some of our elected gooberment officials are in support of mortgage holders withdrawing funds from their retirement accounts.
    ..

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  20. patient

    That’s just crazy. If you can’t afford you home get rid off it. Sell, short sale, foreclosure whatever is needed. Get something you can easily afford or rent and start rebuild your finances. To live in serfdom and enslaved by a lender forever is not the way to live your life.

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  21. Angie

    where is angie? I’m sure she will have something inciteful to say about this.

    Inciteful?

    I think it’s sad that people are raiding retirement funds as they try to hang on to their homes.

    Mmm, that’s about it. Have fun with the strawman arguments, guys.

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  22. declinest

    “Buildings can be sold. Rent control doesn’t exist.”

    what is so bad about buildings being sold? it’s a good thing rent control doesn’t exist.

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  23. Bellevue Ave

    wheres the strawman? also that wasn’t very inciteful.

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  24. Mike2

    It’s amazing 401K’s and IRA’s still exist in the current environment. The temptation to stimulate spending through holding penalties and withdrawl incentives has got to be intense. Having people put away pre tax income is as bad or worst than not spending home equity.

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  25. Buceri

    From off-topic link:
    “What has happened with housing and the economy has really blown up for people at the lower end of the spectrum.”
    Oh please!!!! With the way medical insurance premiums have gone up in the last 5-8 years; not even “people in the middle of the spectrum” have been contributing to their 401K for a while…

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  26. Gary

    This thing will all shake out and the market will re-allot rent levels and which condos should be re-partmented but there will be a lot of unnecessary suffering in the process. We recently moved up from Portland and watched the market for a year and half before buying. We’d expected prices to go down for a long time and when the price reductions and the deal we got met an equilibrium with our desire to get out of an apartment we bought. So I speak from a now less biased view when I say that Washington state needs better tenant protection laws. I’m a conservative. Washington seems to be run of, by and for the wealthy – surprising in such a liberal state. Housing prices here would probably come down more quickly if rents were lower but there is so much vacant space out there waiting to be sold that we have a pincer effect between home prices and rents. Ultimately, we need far better economics educations in high schools and colleges so people have a better understanding of what’s going on and can make better individual decisions, which are ultimately what drive the market. Then maybe we’ll be less prone to such bubbles. The bottom line is that the housing frenzy never made economic sense.

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  27. jon

    Here’s another tragic case of a family caught in the bubble:

    http://iowahawk.typepad.com/iowahawk/2007/12/please-dont-des.html

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  28. WestSideBilly

    jon… you do realize that’s an entirely satirical blog entry?

    Rate this comment: Thumb up 0

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