The Monarch, which started out initially as an apartment highrise & flipped to condo sales, has flipped back to its original conception as an apartment community. The project looks to be about 80% complete, and the word through the grapevine is that its investors set an end of October goal of 80% sold in order to move forward with the project as a condo sale.
There’s been a ton of speculation about the downtown Austin condo market. I’m a little leery of it – especially with the recent shifts in the mortgage market. Most of the projects are very close to sold out in pre-construction. However, I think that a large percentage of the buyers downtown are in the volatile “alt-A” category & will be very curious to see how many of the contracts convert.
Regardless, I think the Monarch’s conversion back to a rental apartment community is a good shift for downtown. It adds much needed lease units, and takes a nice chunk of sale inventory out of the market – which will help prop up the prices.
From what is happening with condos in lots of other real estate marketplaces it seems like a good move. I would not want to be owning a major condo project at this time.
I’m glad to see your story and comment about being leary about the downtown condo market. I’ve been a bit concerned even before the lending meltdown hit. Seeing the Monarch go back I think is a good thing.
What’s going on downtown is really cool…which is why I think a lot of buyers are throwing caution to the wind. Entry level 1200s.f. units (new construction) are in the $500k range & units half that size are starting in the $300’s. I just can’t see how these prices can appreciate, or at the worst – continue to stay this high.
The only plus side is the # of units being purchased as second homes – a big percentage are. That will help out the pricing.
I think you are right to be leery about the downtown condos. I know in other parts of the country many of these buyers bought at pre-construction prices thinking they could flip the thing the day they closed and make a 100% profit. I wonder how many of these will cancel.
Downtown living is really cool and a great solution to urban sprawl, I just wonder how many of these people are “real buyers”.
This is always an interesting process to watch in any downtown community. Pricing fluctuates as it is in some areas, a switch like this can likely impact a whole area.