Urban Jacksonville

POP! Did you hear that?

08/09/06 • Posted in: Downtown Jacksonville, News by Joey Marchy

That was the sound of the Miami-Dade housing market bursting. A Time magazine article reported this week that “the housing market in parts of South Florida is melting faster than a snow cone on Miami Beach.”

What does this mean for Jacksonville and it’s 3 Southbank condo towers nearing construction, the Lofts on Main in Springfield and the multitude of other condo towers coming online in the downtown area? Probably not much. Due to our mid-market status its likely our bubble will remain intact for a while. But for how long? Krista Fracke from the Real Estate blog, a local real estate industry blog says condo sales actually went UP in June by 10%, but the median price of a condo fell 9%.

Nationally sales are down 8.9%, housing inventories have increased 39% and prices are flat. This creates visions in my head of downtown condo projects stalling or going unrealized due to lack of demand. This little snippet from the article seemed curiously foreboding:

If you live in Bubbleopolis, things certainly look scary. In Miami there’s a 17-month supply of single-family homes for sale, according to the NAR. Some 75,000 condos are coming on the market in Miami–Dade County, many purchased by speculators with no plans to live in them. There will be lots of foreclosures, lots of auctions, predicts real estate agent Rose. (link)

This sounds strangely familiar to the Berkman Plaza situation. Someone once told me many of the Berkman condos were purchased by investors who don’t even live there. He said I should drive by in the early evening and check out how many lights are on in the condo. I haven’t done this, but it would supposedly illustrate the lack of actual people living in the condo.

tags: jacksonville, miami, housing bubble, berkman plaza

This entry was posted on Wednesday, August 9th, 2006 at 7:05 am and is filed under Downtown Jacksonville, News. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

Why can't we all just get alon

"One thing to remember is that a home purchase tends to be the largest purchases any person or family will ever make."

This is very true.....you buy a home because it fits your specific needs. These needs are different for everyone, which again is why Springfield has such a unique blend of people/homes.

My opinion on the whole thing is that as long as my neighbor takes pride in their home and tries to make Springfield a safer community I don't care what they live in!

PCollin.....Don't loose any more sleep!
Why can't we all just get alon

"One thing to remember is that a home purchase tends to be the largest purchases any person or family will ever make."

This is very true.....

My opinion on the whole thing is that as long as my neighbor takes pride in their home and tries to make Springfield a safer community I don't care what they live in!
DamonNoisettejavascript:void(0

VyStar Credit Union has a no closing costs mortgage ( up to $5K in costs) . No lie. Decent rate too...
Riskable

I just sold my built-in-1958 house in Arlington and I'm now looking for a new place. I hope the bubble bursts tomorrow! hehehe

Unfortunately I'll probably end up paying the peak price for a home and then we'll have a real estate glut. That would suck.

Note: Closing costs suck!

-Riskable
http://riskable.com
"I have a license to kill -9"
DamonNoisettejavascript:void(0

Ah, forget it.
DamonNoisettejavascript:void(0

Who wants to hear bad news or opinions? Who wants to be told they overpaid for their home [in the hundreds of thousands]?

One thing to remember is that a home purchase tends to be the largest purchases any person or family will ever make. Obviously that means the parties involved in a discussion about homes -- specifically theirs or ones in their area -- will have a "vested" interest in the discussion and are loath to hear that they made a mistake buying/selling/whatever. I'm certainly not going to say that [in a public forum like this]!

At least not going forward.

It's just my opinion, but I think the specuvestors who didn't see the rising tide of home supply and accompanying slowdown deserve everything they get. I also think the builders who focus on high-end and luxury condominium projects in a city with a median income of less than $50,000 deserve to have their projects fail and sit relatively vacant. I'm not a homebuilder, but I wouldn't be surprised if affordable homes -- read:
joeymarchy

It's very easy for that to happen. If I feel myself getting emotional about something I normally dont write about anything. And if someone ever responds to a comment or post of mine in a hostile way, I just let it go. If you don't invariably it will result in a flame war, hurt feelings, bad vibes.

Sorry to hear you will be leaving the conversation for a while, we look forward to the day when you decide to return.
PCollins

You know what? I didn't get much sleep last night thinking that I had offended one of my neighbors and/or friends with my asinine comments. I never thought I would get sucked into the Negative Asshole Vortex, very evident these last few weeks in comments on the SPAR Forum and UrbanJax. Yet there I was...

I am thinking I will take a break from blog comments and Forums for while...

Phil
PCollins

well, ok yah, you are very correct WCWAJGA and "Lay Off the Drugs". And I am sorry if I offended. I did not mean to [trying to yank foot out of mouth]. My comments were more directed to realtors who upsell on the edge of dishonesty, but failed miserably in getting my point across by bashing someone else's home. Not very cool....

"I wish Michael Trautman had the knowledge you guys had, maybe instead of living in a million dollar house, he could live in one of your beauties!!!" ---lol...ok, ok...point well taken....
Why can't we all just get alon

The thing I love most about our neighborhood is that it is a unique blend on people. There are those that enjoy living in historic homes and there are those who enjoy being part of a "community". The BOA homes and those who live in them are assets to this community. What other neighborhood has monthly softball games, mommy's nite outs, and various children events. Instead of bashing our neighbor's home, why not take pride in our community.
Lay off the drugs

I think you guys are all wrong, but I'm biased!!! I live in one those mediocre houses and maybe I overpaid at 135K for a new house that doesn't back up to a HUD complex with two neighbors who care about their houses.

I do believe 320K or 349K is a little too high, but I thought 220K was high for an SRG house that now sells for 340K three years later.

What about the little green beauty on Laura Street between 5th and 6th street, its list around 150K (right across the street from that dangerous house) and needs about 100K to be somewhat acceptable to modern standards.

I wish Michael Trautman had the knowledge you guys had, maybe instead of living in a million dollar house, he could live in one of you beauties!!!

Watch where you throw your stones, they might land on someone they weren't intended for.
Tony

I just heard from a friend that the WA Knight building has SIX vacant apartments currently. This is rare. If you are looking for a spot downtown you should check www.waknight.com. I lived there for a time with my family and then my mom lived there after me. It is a great spot downtown. Vacancies!
PCollins

"Even with laminant flooring and granite counters, they are still medicore houses"

Give me hardwood flooring and marble counters and maybe we'll talk.

Realtors crack me up with their upsell. My neighbor's shed was listed as a one-car garage.

Laminate flooring is the linoleum of 2006.
PCollins

Well, ok...for one thing she wasn't robbed at gunpoint...just wacked in the head with a gun. And not robbed.

HUGE difference.

What, the house is haunted now? Are the apartments and houses in other parts of the city stained as well? Is the Carling any more dangerous due to the recent [enter crime here] just down the street?

And I would have to disagree with you and DowntownParks. Even $250k is way too much for one of those BOA houses. Esp. when the house just up the street is 1000 sf bigger, built in 1911, beautifully renovated, and sold for about $320k. The "problem" lays with the person selling the house. He always prices his stuff in the stratosphere.

I guess someone may be willing to lay down that kind of money. And if not, the sellers will eventually bring the price down.

I think there needs to be more HOME buyers and not Investment buyers. When (now that) the housing market softens (imploding now), I feel that it serves squat investers right to be feeling nervous.

Phil
fawn

Parks: yes i meant the 2 houses at the NW corner of laura and 5th. and i think they need to come down more 50K (if they are about 320-350K as i am thinking). $250,000 is good for those places seeing as the former owner of one was robbed at gunpoint. but, thanks for telling me about the other corner house, VERY Interesting.
Anonymous

No dice on the Strand/Peninsula as apartment.

The Strand was initially planned as rentals, but now they\'re slated to be condos. Peninsula is sold out.
Tony

The last I heard Berkman was about 70% homesteaders. The Strand and the Peninsula will both be condos. The first was supposed to be apartments and they switched not long ago. The Carling and the 11E projects are projected to go condo as is the WA Knight building once they've met the 5 year rental rule for historic tax credits on those projects.

I think we will have more demand for apartments than we can supply in the next several years. As construction slows and if folks start selling not-producing property there is a chance that we'll see some apartment build up. We need it. Though I think of all the available existing residential downtown we are 100% sold out and low to no vacancy on apartments.

Discloser slash advertisement: My partners and I are selling condos in Springfield that start at $162,000 or so for the smallest, around 800 sqft, the largest is more more than 2000 feet at $325k. www.1951market.com - ask our realtor for specifics.. http://atkinsonrealtygroup.com/

We tried to price it so you could customize it but they are all move in ready. The complex is gated on a quiet block and neighbors liberty park, and have some nice features including 1926 Collegiate Gothic architecture, brick exposure everywhere, huge windows, efficient CHA, dw, WD, security.

We're having an open house, BBQ, art sale, Saturday August 19 from 5pm to 8pm.

So that its not a totally shameless plug there are other moderately priced condos in Springfield here: http://www.metjax.com/forums/showthread.php?t=2360&highlight=frohne

and in the Cathedral District here:
www.16flat.com

There are some townhomes on 11th too probably found at www.thenewspringfield.com

Mention that you read my comment slash ad at the BBQ and I'll buy you a cold beverage...
Downtownparks

Oh, and I understand that they have already sold one of the symphony houses, and they havent even started marketing them yet.

SRG houses seem to sell. Bottom line.

Also, I just realized that you were talking about the Bank of America Houses on the NW corner, not the old house on the NE corner of 5th and Laura...

They were built by BOA as workforce housing in 1999 to sell for about 110K (many of them didnt sell when they only cost 110K). They were not built to sell for 320+, and as we are seeing, they arent. Even with laminant flooring and granite counters, they are still medicore houses. I think that they would sell if they were 50K cheaper.
Downtownparks

The house at the corner of 5th and Laura is a special case.

Because of the way the property is laid out (The sale includes all three buildings) no bank will touch it for financing. The price is a little high, but for a 3500+sq foot house, plus another 2000 sqft house, and a carriage house that needs to be torn down, its not grossly high.

Because the two houses basically overlap, they cant be split up for sale. So in short, it HAS to be a cash transaction, which means you are down to developers and real estate speculators.

It did sell about two years ago (for 225K), but the new owners never even took the sign out of the yard. One of them told me a few weeks ago, they really want to get rid of it.

Other than that, I agree. We have WAY too much real estate speculation going on downtown and in Springfield. I think Springfield has had enough actual progress that the squatters wont drag us down if the housing market takes a hit.

The owners who are not cash strong will get forclosed on, and the banks will try to sell them all for what is owed on them.
fawn

Joey, here is what this means (and i might add that everything I know about this comes from newspaper articles i have read in WSJ, USA Today, NYT, and W. Post, as well as a friend who is one of the agents selling units at the southbank tower next to the Wachovia building):
The VAST majority of people buying these condos in towers-- not 11E (apartments still), and not teh Carling (i guess not high end enough?)-- are investors who have no plan on living in these places and think they can sell them off quickly at huge profits. But, it seems like large numbers of people are not buying these units to live in them, so they sit in the investors hands, waiting to be purchased. Which, I personally think is great because I would love to live in one of those towers, but I'm sorry $400,000 plus over $1,000 a month in association fees? Nah brah.
Also, you can this happening right in springfield. I mean, there are two NICE houses at the corner of laura and 5th that have sat unsold for many months-- I would say that is due to the $300,000+ price tag. People bought into the hype too quickly that you could make SERIOUS buck in the 'Field and not we have a glut of overpriced housing-- same as with what will happen in these new towers. And seriously, is anyone going to pay $600,000 for one of those symphony houses when someone was robbed at gunpoint less than three blocks away last year? I think not.
Downtownparks

I thought the Strand and Peninsula were both rentals? I know at least one of them will be.

11E, and the Carling are rentals with a plan to go condo in the future, and the Jax Telecom blding is rentals... They are out there...
joeymarchy

Jesse, what are you doing? We are all making fistfuls of cash! Ha ha ha, so true, so true. Everyone (the City, developers, etc.) is talking workforce housing and affordable housing so maybe we will see some in the next few years.
Anonymous

Personally, I wouldn\'t mind the housing market softening.

All these towers are going up Downtown, but none of them are for rentals. Sure, I could move into a new condo in The Strand for the \'affordable\' price of +200k. Seriously?

Even the current rentals - Carling and 11E are supposed to go condo in a few years.

Where is the downtown housing for young urbanites who aren\'t making fistfulls of cash?
PCollins

"He said I should drive by in the early evening and check out how many lights are on in the condo. I havenâ€™t done this, but it would supposedly illustrate the lack of actual people living in the condo."

...or they are Creatures of the Night.

Vampires! brrrrrr, scary.....

"Look at your reflection in the mirror. You're a creature of the night Michael, just like out of a comic book! You're a vampire Michael! My own brother, a goddamn, shit-sucking vampire."
SAM, Lost Boys

POP! Did you hear that?

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