Enough….please!!!
Does anyone else think there are way to many condo building being built? There are numerous plans for condos along the Mississippi, four new condo buildings underway in Uptown, and at least one new condo building in the Warehouse District. Those are the only ones I am aware of, but I’m sure there is more. With the housing situation leveling out like it has been, it could spell bad news for all these new buildings. They are going to have to sell them pretty darn cheap to get people to buy them. There is ALREADY a glut in the market for them. What is weird is people ARE buying them, and quickly. I want to know if this is housing people are buying from outside the state, or are there a huge amount of houses that are on the market right now? Either way, if we keep building condos at the rate we are, it could spell disaster for EVERYONE. I feel like our house won’t sell as high if someone can go get a condo for cheap. That would REALLY suck.
What do other people think about this?
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I agree that there are quite a surprising number of condo projects in the works or on the drawing boards for the city of Minneapolis. Most, as you note, are planned for downtown and uptown. The downtown journal/sw journal has published an insert with a list of all of the projects.
A few things to note when thinking about all of this:
- The city of Minneapolis estimates that 466,000 people will live in the city by 2030. The 2000 census counted 382,000 people. In about 30 years, the population is projected to increase by 21%. Unless the city annexes more land or significantly changes land use designations or household sizes reverse the downward size, up is the only way to go.
- The Met Council’s 2030 plans target new residential development being 50/50 single family homes/multi-dewelling units.
- The baby boomers are just starting to retire or becoming empty nesters and looking for lower maintenance housing. I know an increasing number of people in this circumstance. Plus, I know people that fall outside of the baby boomer generation that have moved into condos, lofts, and townhouses.
- According to the National Association of Realtors, the average (or is it median) value of a home in the U.S. is lower than the average (or is it median) value of a condo. I read it on cnnfn.com today. I don’t know if this holds true for this metro area, though. If it does, well, your house is already worth less than a condo.
Given all of this, I don’t know if there will be a crash in condo prices. Generally, the Minneapolis-St. Paul real estate market is one of the least volatile major markets in the U.S. I doubt it will happen, but it could. 20,000 new residents in the downtown neighborhoods in the last five years may constitute a trend.
Yes, there are a lot of condos being built. However, the condos are selling well, and it is rare that builders overbuild the market in any area. A great deal of money is spent typically in predicting what project will be profitable. Though the housing market has slowed a bit, it is still strong. A friend of mine sold a house in Northeast last week in three days- for $10k over list price.
I find the condo-craze encouraging. Firstly, because it is evidence of a strong local economy that can support this development. Secondly, b/c urban cities with high densities like Paris, Boston, etc tend to be better places to be than low-density sprawls like L.A. or Dallas.
I’m a condo-dweller. I am living in a 16-unit building that was built in 2004. So, in a way, I’ve contributed to the condo explosion.
Yet, the building is an improvement in the neighborhood, as well as offering space to a locally-owned business (Tillie’s Bean: everyone should go there for coffee, desserts and sandwiches!), and our residents love the city and wanted to make a home here.
Now, there are other condo projects that have gone up along the Hiawatha Corridor that haven’t been as successful: senior living condos? I don’t think there’s a vast untapped market of seniors wanting to move into the city, since most of the units still sit vacant.
Overall, the condo explosion has outstripped the demand of city-dwellers with more money than sense. The prices are very high and there isn’t the support in the areas they are building for high-density housing, like grocery stores, daycares, health clubs, etc.
I’d be more enthused about the condo boom if I personally could afford one. But the point about the population density and quality of city life is a good one. So I’m trying to keep that perspective (while I continue to rent an apartment).
And also the point about support is huge. I don’t see it as much of a problem in the immediate vicinities of Uptown and Downtown, but it certainly is in many other areas of town. That’s the problem with North Minneapolis, condos or not. You gotta drive halfway across town to get to the nearest grocery store. Maybe the funding/approval/building requirements are less/shorter for these types of businesses and we’ll see them pop up as all the condos are nearer to completion.
I disagree that builders will overbuild a market-look at what happened in Chicago in the late ’80s early ’90’s. I do not think a condo is a smart investment at the moment- the bottom will eventually drop out and then there will be bargains to be had. There is such a thing as irrational exhuberance in the real estate market-it seems to play itself out every 15 years or so.
There has been some very valid points made. Thank you all for informing me a little more. I still think that we are bulding too much, too fast. That just doesn’t seem smart, no matter how you look at it.
What’s happening is Minneapolis is becoming a city for the affluent. People with little to no money are hopping on the Greyhound headed for Duluth, where they can still find an apartment for $400 a month. In essence, what is happening is Minneapolis is slowly becoming a sterile, beige city home to those with college degrees and great benefit packages; the quirky people and mix of incomes that made the city interesting will be gone. They can’t afford to compete with those who, in all fairness, did the right things by completing college and climbing the career ladder. However, it also is creating a serious class system in our society…cities like Minneapolis, Chicago and Denver are becoming the uber-trendy cities for those with money, while Duluth, Sioux Falls and Grand Forks are becoming cities for people with no money, no skills, lots of kids, and no prospects. The new ghettos will be the medium sized cities; the ‘winners’ will be the major cities. Might be overdramitic, but it creeps me out.