"Downtown Bellevue condos beckon to younger crowd"
http://seattletimes.nwsource.com/html/e ... os11e.html
"It's not uncommon to see a 28-year-old tech worker in a $1 million condo," said Dean Jones, president of Realogics, a Seattle company that markets several Bellevue residential projects.
Okay, be honest...how many of you 28-year-old tech workers could afford a $1M condo? To be fair, Mr. Jones was supposedly describing foreign workers who are getting help from "families back home" but still.
I've also heard that some of these towers are offering protection against falling prices to help keep people from cancelling their contracts. Apparently the developer can count the unit as "sold" once someone has plunked down the earnest money even though they haven't necesarrily signed a contract.
"It's not uncommon to see a 28-year-old tech worker in a $1 million condo," said Dean Jones, president of Realogics, a Seattle company that markets several Bellevue residential projects.
Okay, be honest...how many of you 28-year-old tech workers could afford a $1M condo? To be fair, Mr. Jones was supposedly describing foreign workers who are getting help from "families back home" but still.
I've also heard that some of these towers are offering protection against falling prices to help keep people from cancelling their contracts. Apparently the developer can count the unit as "sold" once someone has plunked down the earnest money even though they haven't necesarrily signed a contract.
Comments
1) I see myself getting married, why buy a 500K 1.5 bed room condo when I know I will need more space?
2) Bellevue downtown is extremely overbuilt
3) Bellevue towntown is extremely overvalued (most properties are $400/sqfeet)
4) Night life is "average". I say average because they recently opened up Lucky Lanes which is "alright". If they could only get rid of the 40 somethings that hang out at the bar ... no offense to those that go there and in that age group
Over the weekend, I attended the Braven private sale where the show various the floor plans and gave the chance for you to sign "purchase agreements" (10K down and refundable). I must have heard "Microsoft" being mentioned at least 30 times in the 30-40 minutes I was there. Studio "start" at 400k. A one bed room / one bath range from 500K-650K. Those units won't get built till the end of 2009. I left the sale event thinking to my self, by the end of 2009 early 2010... I will be 30! (god I am getting old)... why the heck would I still want to be in a one bed room / one bath (the max I can afford).
I also overheard this conversation with an older retired couple
Retired Couple: I was thinking of a 2 bed room, 2 bath unit
Sales Agent: Well, heres what we have ... <shows the price sheet>
Retired Couple: I think its a little bit out of our price range
Sales Agent: Well, here are some in the 1 million to 1.5 million price range
Retired couple: akward look...
sales Agent: <goes on about how great the unit is>
Retired couple left 10 mins after
I can understand the agent's confusion. When someone says something is "out of their price range", it can either be interpreted as "the price is too high" or "I need something at double the price". Why the retired couple didn't understand the double meaning blows me away.
I was reading one of the Seattle magazines while waiting for the doctor the other day, and there were numerous ads for condo buildings under construction. "1 Bedrooms starting at $600k" seemed pretty typical. That is ludicrous. Absurd. Ridiculous. Pick your adjective!
As for the 28 year old tech worker in a million dollar condo, he probably bought it when he was 22 and it cost $250k.
Of course, we all know that. But put yourself in the shoes of a sales agent...
Can't imagine how they can fill up all those condo spaces, has anyone calculate how many new condos will be available by 2009?
It'll be very interesting to see the number:
2500 units x 1,000,000 average price = 2,500,000,000 = Armageddon.
Base on this website: http://activerain.com/blogsview/261418/ ... ondo-Round
Bellevue Tower
-535 units
-$500k to $2 million
Random guess, $750k x 535 = $401,250,000 worth of property.
European Tower
I don't see any actual progress there yet, will skip it for now.
One Main Street
-62 units
-$400k to $1 million+
Random guess, $650k x 62 = $40,300,000
The Residences at Bravern
-450 units
-$400k to $4 million
Random guess, $800k x 450 = $360,000,000
Vida Condominium
-238 units
-$300k to $800k
Random guess, $400k x 238 = $95,200,000
Washington Square (http://www.construction.com/NewsCenter/ ... 0726nw.asp)
-360 units + 22 luxury units
-all over the place $600k to multi-millions
Random guess, $900k x 380 = $342,000,000
Then there are bunch of smaller buildings, retirement homes, new apartments that are unaccounted for. But base on the above condos, we're looking at combine value of approximately $1.25 billion dollar worth of property and 1670 of new condo units.
Shit...imagine that.
I don't really get this argument that "real estate will keep going up because foreigners will buy it all up". I understand that has happened in some places in the past. Specifically, a large amount of Hawaiian real estate was purchased by the Japanese after WWII. Of course, it wasn't even a state prior to WWII, so Hawaiians probably consider it little different than NY businessmen buying up the same land.
But who is going to buy up all the commercial and residential real estate in the nation? If they succeed, it's a huge risk. The US government still has imminent domain. Three Hundred Million unhappy citizens sending their rent checks to Asia would probably be enough to cause the US government to seize all property in the nation and split it up amongst the citizens.
In my neighborhood (north of M$) I have seen immigrants (working in hi-tech) buy very expensive houses, but there is one difference from typical Americans--they have multiple extended family members living together so they are combining their income/savings in order to buy. Down the street are some Russians with two brothers (one in the MIL apt. above the separate garage) living with their parents in a $700K place, and my former neighbors from Pakistan just bought a $800K house one block away and are living with one of their parents (think some MS stock options + inheritance was involved). I'm not sure how widespread this is.
I know if my parents sold out of their holdings and moved in with my family, we could afford a much nicer place than I currently have. But then, not everybody wants to live with their extended family either!
The only real benefit to living in a condo (or townhome for that matter) is that it's cheaper. There are some small secondary benefits, like not having to mow the lawn or fix the leaky roof of your 1920s era craphole. The tradeoff is reduced space, reduced privacy, high HOA dues, etc. When it's no longer cheaper, there isn't a lot of reason to consider a condo, unless you want to live on the 30th floor of some tower and have a nice view (which only lasts until they build a building across the street and block your view).
Spending $750k on a 2&2 condo does not make sense to me, because for the same price, you can buy a SFH that is bigger and has more privacy. You're paying $4500/month to live in a glorified apartment. If that same condo is $300k, I might think about it simply because it's nicer than the houses $300k can buy.
Last year, these condos were going to be sold to "downsizing boomers" who are just dying to live in an urban environment. Now they are going to sell them to 30 year olds despite all evidence pointing to the contrary in terms of their ability to afford the prices.
Meanwhile, the developers in downtown Seattle (where there is at least some evidence that people actually DO buy condos) are scrambling to figure out how they convert half of them to apartment buildings.
That's not really what I meant. I think immigrants buying homes is likely. The fear mongering I've heard is more like foreign investors from China will sweep in with a strong Yuan and buy up every lot in Seattle, driving up the price. Not to live in, but to rent out or some such nonsense. Immigrants living several to a home is very smart (except they should have to pay higher taxes if they park 8 cars on the street or something).