Legacy Condominiums - 121 12th Ave S (187' - 17 Stories)

[matthew5080]

I can't get over how dark of a building it is.

[grant1simons2]

Demo has started

[contrast]

WOW! that was quick!

[mnmike]

It was stated in the articles about this being approved that demo had already begun.

[proverfent]

As a person actively looking for a condo downtown, I can't see myself living here. This place looks, as Trump says, "huge!" But not in a good way.

[mnmike]

We REALLY need more condos in the 200-300k range...I suppose these will mostly start above that.

[twincitizen]

Do you believe it to be possible to build condos downtown for under $300k? That seems extremely unlikely to happen, unless you're taking about 500 sf studios. Stanton doesn't seem to include units that size in his buildings. Multiple downtown developers have said they need to sell for around $330/sf minimum. $300,000 is probably the absolute floor going forward

[Tyler]

In my opinion, it's absolutely possible and Stanton could easily do it. But why would he? He knows exactly what the masses want and what he can make the most money on. And its obviously larger units.

[mattaudio]

Isn't the problem that condominiums are in such short supply downtown? As Stanton and others build new condos, shouldn't that push down the cost of units in the old 70s/80s-vintage condo towers?

[EOst]

But they also have huge incentives to keep condo prices high. The tighter the market, the faster they sell.

[mnmike]

Isn't the problem that condominiums are in such short supply downtown? As Stanton and others build new condos, shouldn't that push down the cost of units in the old 70s/80s-vintage condo towers?

Not really...only if they are entirely not updated and in really poor shape. Unless there is a glut, the more expensive units bring up the prices of all the units.

[mnmike]

There is a HUGE market of people that would buy condos in the 200-300k range...but hardly any available. I am sure there is a way to build condos in that range...a building like that would sell out immediately.

[FISHMANPET]

That's... not how any of this works.

You're gonna have to justify your claim that increasing supply will increase prices.

[mnmike]

But...it is. I don't know what else to tell you. I've been doing real estate part time for a number of years. Build higher end units in a neighborhood and the prices of the lower end units will come up. That's...how this works. We just need more of a supply in general, I suppose, until then the market will remain very top heavy.

If so many units are built that there is an oversupply...that is a different story. Then all the prices come tumbling down. Barring that or economic collapse (see bank practices 10 years ago)...real estate increases in value.

If new condo buildings decreased the value of existing condos...that would be one hell of a NIMBY argument. lol

[EOst]

It's very hard to disentangle the downward price pressure of new housing stock from the upward pressure that a new building brings through more people, more businesses, fewer vacant lots, etc.

[mnmike]

Yup...if you can find a decent unit at a good price downtown...snag it, that value will be increasing. Most are selling before they hit MLS. Unless we get a huge amount of new supply...it's going to be getting expensive all around. We will see if we see some big flips of some of these new apartments to condo.

[FISHMANPET]

I think it's a matter of degrees here. I don't think new condos are increase prices, I think prices are increasing period. If we dumped enough supply on the market then the older properties would fall in price or at least not rice as much.

[mattaudio]

Just imagine how much more the prices of "vintage" downtown condos would be rising, given the current surge in *demand* to live in owner-occupied housing in those locations, *but for* the new condo supply coming online. The price increases would be even worse.

[min-chi-cbus]

There is a HUGE market of people that would buy condos in the 200-300k range...but hardly any available. I am sure there is a way to build condos in that range...a building like that would sell out immediately.

I think the "answer" is probably modular homes:
http://www.startribune.com/new-company- ... 381029171/

Otherwise my understanding is that the overhead costs of labor and materials makes almost any new home constructed (in particular mid-rise or high-rise construction) moderately expensive, pushing the price point at/above $300K when using traditional construction methods.

[EOst]

But you're both basically assuming that the demand for housing in an area is static, i.e. that X number of people are looking to buy "in a place" whether the number of condos is Y or Y+N. That just isn't necessarily true, because the value of housing is influenced by more than just supply. The Mill District or Uptown are obvious examples; how much has the rapid growth in Uptown retail raised rents/prices in that area simply by making the proposition more desirable?

So yeah, you might get Y+N condos, but you'll also get X+Q more people looking at the area, for whom the newly filled in lot or the pedestrian amenity or the business or whatever made it sound like a good place to live. Is N > Q? If so, great. But if not, your building will raise prices, not lower them.