Downtown Charlotte Real Estate

The Changing Face Of Retail

2012-02-06T07:00:00.000-08:00

Well, actually that headline is a bit misleading, but go here to read an article from the New York Times that discusses reusing retail space for other purposes..

The lead paragraph in the article discusses a mall project opened in Cleveland over 20 years ago to try to bring retail, and traditional retail mall thinking, back into a downtown area. Now, being from Cleveland, I have some familiarity with that project. I recall walking into it back in the early 90's and marveling at the scope of the project. Those of you who are familiar with Cleveland might recall the similarity of The Galleria to the Arcade between Euclid and Superior.

I recall wondering how the Galleria could maintain it's momentum. It was located in the base of an office building, which might give it some life around lunch time or dinner time, but had no residential impact around it. It was inconvenient for someone to go there from the suburbs, and why bother, all the stores there were located out in the suburbs as well.

But, getting back to the headline, this article goes on to say that many traditional merchants are closing some of their less productive locations, and are not adding, at least in a traditional sense, more new locations. Our shopping habits have also changed. It is pretty easy to order staple merchandise, such as office supplies, underwear, etc. on line and have it delivered at no charge to our doors. When I was a buyer for a department store, and budgets were tight, I could always get an order passed for basic merchandise, because it was the basic merchandise that brought people in regularly.

If you take away the basic need to go shopping by using the Internet, merchants need to create other methods to bring you into their stores, the endless sales with inflated regular prices being slashed to show a big deal to buy at their sale prices. There is always a sale!

So, the article discusses re-uses for traditional retail malls, and even Eastland is mentioned. The reuse almost always turns to creating mini-downtown's in their spaces, town centers if you will. These efforts are designed to create reasons to bring people there. The article also alludes to the fact that stores now see the ability to walk in off the street is preferable to walking in through a mall.

Could this be the advent of the return of Retail to downtown Charlotte? Maybe, but not the way it was in the past. For years I have been advocating taking the banks, doctors offices, brokerage houses, copy centers, etc. off the street level access it currently enjoys, and putting those things in the Overstreet Mall. I would then take the merchants and restaurants from the Overstreet Mall and put them on ground level. Return street life to Charlotte.

Downtown Charlotte already has the town center. As this expands, we will all see our property values once again increase.

Good-Bye Downtown Donnie

2012-02-02T11:55:00.000-08:00

For over 25 years, Donnie and his hot dog cart have been gracing the sidewalks of Tryon Street selling dogs, sausages, soft drinks and chips. Most recently Downtown Donnie has been on the corner of South Tryon and Third Streets, that is where I met him.

In addition to being a fixture on Tryon, Donnie also does special events. Several years ago, I engaged Donnie to bring his cart to a Friends of Fourth Ward meeting when we were discussing the on going saga of bringing the Charlotte Knights to the downtown area.

Donnie has also worked other events, grand openings, parties, open houses, etc. Donnie will be continuing those special events.

So, as time continues to march on, we will miss seeing Donnie's weathered face as he feeds Charlotte.

The Time To Buy Is Now

2012-02-01T07:40:00.000-08:00

This is taken from John Talbot the author of The Coming Crash in the Housing Market and Sell Now! The End of the Housing Bubble, both written before 2005. He is currently talking about the reasons that make right now the best time to buy, and here are excerpts from his article;

Home prices are off anywhere from 10% to more than 60% in cities across the country. There is no reason to believe that prices were "fair" during the bubble as we have seen they were largely caused by loose and aggressive lending by banks and non-banks And by my calculations, in most cities across the country, real prices adjusted for inflation have just about come into line with where prices were in 1997

Homes in many cities across the country are now selling for as little as $60 to $70 a square foot. Depending on the quality of construction and the underlying land value, this represents a 50% to 65% discount to the costs you would incur if you tried to build a similar home today in these cities.

During the peak years of the housing bubble, entire cities like San Diego were seeing their homes priced on average at 11 times the area's median family income. Now, homes in many cities are changing hands at three to four times average family incomes.

We still talk about home prices in dollar terms, which is silly because the dollar has lost 98% of its purchasing power relative to a more stable asset like gold over the last fifty years. If instead of pricing houses in dollars, we look and see what a home would cost in ounces of gold, we see that houses today are a real bargain.

You might argue that this is because gold is priced highly today. I would argue that gold's purchasing power has changed very little over time, it is the dollar that is depreciating and thus giving the appearance that the price of gold is rising. Actually, gold is quite stable relative to other assets and commodities and it is the dollar that is highly volatile and declining in value due to the US funding its deficits by printing dollars.

John R. Talbott, previously a Goldman Sachs investment banker, is a best selling author and economic consultant to families. You can read more about his books, the accuracy of his predictions and his family consulting activities at www.stopthelying.com.

I will augment this article by relating that of the last 4 contracts I have written, 3 have had multiple offers, and while my clients all bid over the asking price, we were not the highest bidder on any of the 3 contracts. Hardly a coincidence.

While stories in the Charlotte Observer and other media outlets tell the tale of the price of homes sold is still dropping, they do not report that the number of non distressed properties on the market is lower than it has been for at least 10 years. It stands to reason that if the market is made up of low end houses that the market will be reflective of those lower prices.

More News About Electric Vehicles

2012-01-25T08:45:00.000-08:00

I met a guy at The Dunhill last week named Brooks Agnew, President & CEO of Vision Motor Cars, Inc. We met through my friend Bill Lamb owner of Amelies French Bakery in NoDa. Bill is using one of Brooks vehicles to make deliveries to the downtown location of Amelies.

As I have a strong interest in electric vehicles, I asked Brooks if he would write something for this blog, and he responded below.

America is in love with theautomobile. Our personal relationshipwith our cars and trucks is unique in history. Auto racing is among the mostpopular spectator sports ever created and dominates the expression of power andstatus in our society. The American roadhas become the system by which everything we produce or consume travels bytruck.

The time has come; however, forthis amazing myth to adapt to reality. The cost of fuel for transportation has become too high for survival; inmore ways than just the price at the pump. The seasoned automotive engineers that founded Vision Motor Cars, withprincipal offices in Concord, North Carolina, have designed and built anaffordable solution that is going into mass production this Spring.

The Everest light electric truck cab and chassis has finally completedthe long road of product development to drive along side fuel-burners on theAmerican highway. The similarities arestunning. The truck has heat and airconditioning, can drive 80 miles an hour, carry 1,000 pounds, and performs inevery way just like its fuel-burning competition to distances up to 100 mileson a single charge. Quite suitable formore than 90% of light truck operations in metro areas.

The differences are even moreamazing. The average light truck cantravel about 17 miles on $3.45 worth of fuel. The Everest can travel nearly300 miles on the same money’s worth of pure, 100% American-madeelectricity. Plug it in at your housewith an ordinary outlet, drier outlet, or utilize the few high-power specialcharging stations slowly coming to the Charlotte area. Or, you can just leave it in the sun, and itwill charge itself up entirely for free. Yes, they even have built in solar panels made right here in Concord tokeep the batteries full.

The Everest is affordable at around $25,000 for the base model. The VMC Urban Delivery Vehicle is perfect forhauling auto parts, appliances, furniture, and thousands of other items farmore efficiently than a fuel-burning truck. Hundreds of routes all over the city can be travelled without spendingmore than about a dollar a day. No oilchanges. No belts, hoses, water, and nofuel of any kind. After rebates, theaverage buyer could pay for the truck completely on the fuel savings in lessthan three years. A small fleet couldpay for a truck each year on the fuel savings directly to the bottom line,possibly making that critical competitive difference for any small businessoperator. The VMC Everest is a vital hedge against the volatility of fuelprices. While your fuel-burningcompetitors are cutting people to keep driving, you can rest easy as you drivepast all the fuel pumps without looking.

When VMC production begins tomeet the current high demand for the truck then the commuter cars will startcoming off the line. Their plans are tobring 1,200 good-paying jobs to Cabarrus County making affordable highway-readyelectric vehicles. A modern vehicle fora modern mankind. Drive Electric. www.mynewev.com

Lower costs, help the environment, allow for more density, all things that will help an urban environment like Charlotte to increase property values.

The Planets Are Aligning

2012-01-13T05:58:00.000-08:00

Last month (Dec 18th) I wrote of the vibrancy of the downtown residential market. In the January 13th edition of the Charlotte Observer, this story discusses the purchase of a piece of land, located next to The Catalyst apartments, that has been purchased by Childress Klein Properties.

The article quotes sources that underline the continued demand for downtown living and projects that it will remain strong even when condominium construction restarts. Rents are also beginning to rise. All good signs for people looking for property values to return.

This also represents further movement by Childress Klein Properties in the downtown market. The One Wells Fargo building is currently being marketed by CKP for sale, and once it is sold, the company will be looking to further their investment in downtown property.

Just like the robin indicates the beginning of spring, this news indicates the beginning of the recovery.

Bumps On The Tracks

2012-01-11T09:36:00.000-08:00

"You have to break an egg to make an omelet!" That is always the case. Progress means changes in how things are done, and sometimes it can negatively impact some. This article talks about how changes to the tracks will affect Harrisburg and its residents.

My belief is that we as a country are about to embark on rebuilding a rail system to connect inner cities as an alternative to air travel and highways. Perhaps slower than air travel, but riders are deposited directly into a downtown area, in most cases closer to their final destination. Trains are additionally not as confining as a plane, wider aisles, dining cars, etc. The seats generally provide more personal work space.

Rail infrastructure will define how cities grow, and without good rail connections, we will be passed by. Think back to the comedy Blazing Saddles. The premise of that movie was who would get a rail stop and who would not. Rail traffic in the 1800's built this country and defined where cities are located. It is happening again.

We in Charlotte have a secure spot on the future of inter-city rail connection. The new AMTRAK station will be located on Trade and Graham Streets, and will quickly become an important part of the city. The proximity to the station will increase property values in the downtown market.

So, looking at that article about the disruption of the current way of life in Harrisburg, we have to look at the general benefits for this society at large. Additionally, a change in Harrisburg does not mean the end of Harrisburg, but rather the opportunity for changes to meet the future.

Reshaping Third Ward

2012-01-09T05:38:00.000-08:00

The accompanying picture does not look like much, but it is the start of something BIG! The official groundbreaking for the Romare Bearden Park located in the Third Ward was on September 1, 2011, mostly to coincide with the 100 birthday of the artist, and the unveiling of his works at the Mint Museum. It mostly consisted of politicians talking alot, and Jennifer Roberts operating some construction equipment as she knocked down a bit of a wall on a building slated for demolition.

What has happened since that day is that the buildings in question have come down and some clearing work has been done to the site. This picture shows the beginning of the reformation of the streets in conjunction with the park. Mint Street will be restructured to be two-way, and that is happening now.
The curve on Poplar Street will disappear, and Poplar will dead-end into Third Street at the Park, and it too will become two-way.

These two restructurings will allow for the park to expand to its full size, and that is good, but it will also act as a traffic slowing in that section of the city. One-way streets are designed to move traffic fast and away. Two-way streets are designed to slow traffic, and allow for easier and convenient access to the properties located there.

The reconstruction will also play havoc with the tailgate parties that gather there during football season. Future development will also claim more of the land currently enjoyed by football fans, and the impending relocation of the Charlotte Knights will take even more land away.

Despite the inconvenience to those fans, these actions will create new opportunities for the city to develop more density, and perhaps begin the reintroduction of retail options to the city. Density and growth will lead to an increased demand for space in the downtown market, and that will help to drive up property values in all areas of the downtown market.

Looking Back On 2011

2012-01-06T04:36:00.000-08:00

The saying "aglass half empty vs a glass half full" is a good description of whathappened in Charlotte during the past year.

Unemploymentremained uncomfortably high, yet there were numerous announcements of companiesrelocation either headquarters or major divisions to Charlotte. Bank ofAmerica announced the start of the New BAC by indicating that the will shed30,000 employees over the next three years. While that sounds like a lot,a large percentage of those employees will leave through attrition. Manyothers will post out of jobs being eliminated into newly created jobs indivisions that are growing, half empty or half full?

Dukeand Progress Energy will be merging, and the headquarters of this company willbe in Charlotte. Raleigh will feel the largest pain in this merger, butmany Progress employees will be relocating to Charlotte. This will be thebiggest part of the emerging energy and energy related companies looking tocall Charlotte home.

Citybuilding made strides with the beginning of the Romare Bearden Park in theThird Ward, and the soon (?) to begin construction of the First Ward Park nearthe UNCC Uptown Classroom Building. Both parks will spur constructionactivity on ancillary properties. The key fact is that these parks havepassed from proposed to under construction.

Condodevelopment downtown during the year centered around the re-emergence of ThePark, now called Skye, and The VUE. Skye promises to be an interestingbuilding. Half Hyatt Hotel, and half condo, this development will bringvibrancy to the Second Ward. I have been in some of the units underconstruction, and can relate that the views from the west side of this buildingare incredible, and the pricing is structured to quickly sell.

TheVUE remains another issue. There are reportedly around 200 existingcontracts in place for this building. Many of the contract holders areconcerned that the value of the building has fallen below levels that makesense to purchase. Others have found difficulty in getting appraisals tosupport the mortgages needed to close their deals. The developer isentitled to keep deposits, but has been trying to sue to force people to close.

Thedeveloper has not been successful in getting the courts to back up hisposition.

Whatis at stake here is getting people into the building. Many of those unitsthat are under contract are positioned in preferred locations in thebuilding. The developer has maintained the premium pricing for all theunits (with some exceptions) and new contracts are slow come. Once allthe court cases and appeals end I would expect to see significant movement.

7VenthMarket changed its name to 7th Street Public Market and opened in earlyDecember moving towards a Grand Opening in the April time period. TheMarket was obligated to open due to contracts with some growers in the region,so it did. It is a work in progress.

TheCharlotte Knights baseball stadium made several strides, one from the countyextending the time to have funding in place and dirt turned for an additionalyear. Duke Energy was also linked to the Knights as a potential namingrights participant for the stadium, which should aid in securing constructionloans.

Itshould also be noted that many of the companies looking to relocate here citethe Charlotte Douglas International Airport as a major consideration. Theairport continues to grow with the addition of a new runway and the placementof a multi-modal freight yard being placed between two of the runways.

More Insight About Renting VS Owning

2012-01-03T06:29:00.000-08:00

Here is an exerpt from an article about the current market renting vs. owning:

Rising rents are forcingrenters to outspend home owners on housing costs, according to a recentstudy. Since 2005, home owners’ housing expenses have climbed from 31.9percent of their household budget to 33.2 percent. On the other hand, in thatsame time period, renters’ expenses have jumped from 35.6 percent to 38.4percent, according to the October CoreLogic U.S. Housing Trends. In the last 26years, home owners have increased the amount they spend on household expensesby 12 percent while renters have increased it by 22 percent, according to thestudy. Earlier this month, Capital Economics economists noted that for thefirst time in 30 years the median monthly home loan payment is about the same-- or less -- than the median rental payment. Yet, with the bleak jobmarket, home ownership rates continue to fall in many parts of the country,particularly among younger generations. CoreLogic found in its report that thehome ownership rate for the 25-to-34 age group dropped from 51.6 percent in1980 to 42 percent in 2010. For the 35-to-44 age group, home ownership ratesfell from 71.2 percent to 62.3 percent over that period. Source: RISMedia

This supports what I am seeing in the market as well. Property owners are not negotiating on the price of rentals in any way. Over the past year, the leased amount for a property is the same as the asking price for a property. The numbers in the article above article also suppport that claim and indicate that prices for rentals are actually rising.

New construction by and large is in the multi-family rental property, and not in condos. Developers always lag the market, and this market is no exception. I do not expect to see any new construction of condominiums for the next 18 months.

The result of this will be a slow rise in price for existing properties, increasing the property value of homeowners.

Housing Affordability

2011-12-22T06:12:00.000-08:00

"Houses haven't been this affordable since appliances came in Harvest Gold or Avacado Green" states an article in the Kiplinger Housing Forecast, read the full article here. There is evidence of this all over Charlotte as well.

Two projects in Charlotte that are making significant waves are 28th Ro in NoDa, and Seigle Point just outside the I-277 loop on Tenth Street. 28th Ro has closed on 32 units in the past month and only has a few left, and a similar history is available at Seigle Point. In both cases it was a situation where adjusting the price point found an available willing market.

Soon to return to the market will be The Garrison located on North Graham Street inside the I-277 loop. this building was designed to reflect the industrial past of Charlotte, and has huge "warehouse windows" with unparalleled views of the city. My belief is that once they come on the market in early January, they will quickly disappear.

This leads me back to the Kiplinger article. We have all had to reset our financial vision of the future. Many who gambled on the seemingly neverending increase on property values have learned a valuable lesson; if something looks too good to be true, it probably is.

As we clean out our financial obligations and reset our goals, we will once again begin to grow.

Construction Activity Increases

2011-12-18T09:41:00.000-08:00

This article In US News cites 10 cities where construction activity is returning to normal, and Charlotte is # 8 on that list. It shows that we are up 23% in the area of multifamily (rental) housing. Rentals remain very strong. Here is a sampling of trailing 12 months at a few downtown condominiums:

Avenue 33 leased average days on market 52
Courtside 19 leased average days on market 36
5th&Poplar 26 leased average days on market 41
Gateway 29 leased average days on market 51
TradeMark 24 leased average days on market 31

This popularity in rentals is fueling developers to build more rentals. Centro City Works is in the process of finalizing plans to begin construction in February on a rental building near the East/West LYNX Light Rail Station in the South End.

Two other developments that have either finalized or received their building permits will place new apartment developments in downtown Charlotte, one on the corner of MLK Jr. Blvd and South Graham Streets across from the proposed construction site of the Charlotte Knights baseball stadium, and another at the intersection of West Fourth and Johnson & Wales Way in the Third Ward near the Doubletree Hotel.

Another potential site will occur when the former State Office Building on the corner of Graham and Trade Streets is torn down. The building has been crumbling for the past 10 years at least, and an apartment/condo development was originally announced for that space.

Throw in the relocation of the Amtrak Station and MultiModal Terminal on South Graham and a picture of intense construction will change the character of the near Third Ward forever.

All this activity will help raise property values in the entire downtown area.

Renters Can Solve The Housing Crisis

2011-12-11T05:39:00.001-08:00

Really, renters can start the home ownership recovery! In this article, a case is made that people who would most likely be buying a home are waiting for unemployment to come down, and the government to act responsibly before buying.

It also points to the fact that investors are sitting on a lot of cash, and purchasing financially distressed properties at a highly discounted price can lead to a stable cash flow for a protracted period of time.

The catch is that current FHA, Fannie Mae and Freddie Mac require huge downpayments and a substantial waiting period for purchases.

I have written several articles in this blog that point to the increase in renters in the downtown Charlotte market during 2011. The thrust of my blog is to focus on the trend to embrace the urban lifestyle, and renters can embrace that as much as owners can, and embrace it they are.

Getting back to the article linked above, the implication is that if investors are allowed to help clear out the foreclosure and shadow inventory issues in the private market, the government (you and me) will not be stuck with carrying that burden.

I have been more active over the past 90 days than I have since 2007! A large portion of that activity is coming from people seeking to rent. As we search for properties, I am finding that rental rates are increasing, time on market is decreasing, and landlords are not negotiating on their rates.

Supply and Demand reigns again.

The Death Of The Fringe Suburbs

2011-11-26T11:57:00.001-08:00

The New York Times Opinion Page published this article on Saturday, November 25, 2011 discussing the move towards density. It builds a case that cites the car dependent fringe suburbs as the primary cause for the mortgage meltdown leading to the recession. Perhaps an over simplification, but I believe that it does address the root of the problem.

More space, bigger houses, more opportunity to buy products to put in all those rooms all went hand in hand with easy money and low downpayments to encourage people to take on more than what was prudent.

But my point is not to look to the past to uncover issues, but to look forward and try to find trends to be on the front side of them. Most all of my posts deal with things that will affect property values in my market, downtown Charlotte. Energy prices, downsizing, walkability, new companies relocating, strong infrastructure, easy transportation, all these trends contribute to wanting to relocate to the central core of the city, and that is the downtown area and it's Four Wards.

Please follow the link and read the entire article. I toyed with the idea of just reprinting it here, but thought that the link would accomplish the same thing, and it would be easier for me to add my $0.02 to the debate.

Further Signs Of Downtown Demand

2011-11-25T05:40:00.001-08:00

The Demand for living in downtown Charlotte has never been higher than it is now. An article in the MultiHousingNews points to Charlotte's urban core as the key growth area, read the full article here.

"Of course, the hottest submarkets continue to be downtown, inside the 277 loop. “Much of the critical mass of Charlotte’s employment is driven by banking and energy,” notes Llewellyn. “The employment centers never really decentralized from downtown, so the central business district is going to be the number-one submarket.”

This is substantiating what I have been seeing over the past 18 months. In my business, I find that I am getting more calls for rentals than in the past. The reasons are largely the same; not sure of the economy; don't have a down payment; wish to see what living downtown is like; etc.

The developer market is turning towards producing more rental units to try to stay up with the demand, again the article cites absorbsion rates as being out of skew. David Furman is reportedly ready to break ground for an apartment development along the LYNX Blue Line in the South End.

The other trend I see is that rents are rising as interest rates and condo prices are falling, in some cases to be more attractive than rentals. This cycle of condos/rentals/condos/rentals continues to go on. As things stabilize, indications are that a return to purchasing will drive up prices in a condo market that is adding little to the inventory mix. As this happens, property values in the downtown market will rise again.

The law of Supply and Demand lives on!

Public Meeting On The StreetCar Project

2011-11-20T09:07:00.001-08:00

The Charlotte StreetCar Project has completed 65% of the design work, and expects to have 100% completion within the next 3 - 4 weeks. This will allow the project to move forward, though the actual start date for most of the in street construction will not begin until after the DNC in September of 2012.

Go Here to their site for more information as to the facts and overview of the project. But in a nutshell, this phase of the project will run from the Transportation Mall down East Trade / Elizabeth Street to Presbyterian Hospital, turn left to East Fifth Street, and then return. This overall segment will be 1.5 miles. A 1/2 mile segment of this has already been completed through the CCCP Campus and up to the Hospital.

The overall cost for this project is around $35 million, and many complain that it is a waste!

My belief is that it is forward thinking. We have seen fluctuations in the price of gas, and every time it reaches $4 a gallon, ridership increases on all forms of public transportation. Switching to electric powered vehicles or hybrids will help, but not enough. When we reach the breaking point for gasoline prices, it will be too late to start an intelligent transit system.

Additionally, the hard rail system that the StreetCar will be part of will be permanent. It will spur development along its route. Myers Park was created as a street car suburb as was Dilworth. No homes were more than 3 blocks to a transit stop. Those communities became, and still remain, important. Look also at the development created along the LYNX Blue Line running through the South End.

This important connection for West Charlotte to meet with East Charlotte will take riders to the Government Center, the central business community, transportation links, Presbyterian Hospital, Central Piedmont Community College, Johnson & Wales University, Johnson C. Smith University and the Mecklenburg County Courthouse. It will be a huge connector.

This will be a great addition to a growning city.

Finally, The Courtyard Is Back!

2011-11-20T05:38:00.001-08:00

It seemed like forever, the noise, the dust the workers all scurrying around removing tiles, dirt, trees, shrubs and the green as well. It started because the parking garage in under the TransAmerica building, which is also under the 400 North Church Condominiums, was leaking!

The original seal was allowing water to enter into the garage, and in addition to causing some damage to the finish of cars, could cause significant damage to the structure itself. Water is one of those non stoppable forces that can have a significant impact.

All areas over the parking garage had to be empties and resealed, including all the planters. It seems unlikely that this year will feature the trees being strung with lights for the holidays.

The repair work took about 10 months, and cost the buildings owner several million dollars to repair. Watching some of the work be done, I will be surprised if any moisture will ever penetrate the barriers that were laid down.

Living Without A Car

2011-11-07T05:25:00.000-08:00

How can someone live without a car in the city? MSNBC has pulled this article from 24/7 Wall Street that ranks the 10 best cities to live car free. Check this article, but don't be surprised to not find Charlotte on the list, at least not yet.

I am car-less and I live in downtown Charlotte. This is a lifestyle that I choose to live, and will tell you that many of the points made in the article are valid. As a realtor, it always draws interesting looks from people when they find I do not have a car. Being a realtor generally means that you drive a big shiny black car if you are successful.

My experience in showing property in downtown Charlotte is that it is easier to walk to listings than it is to try to find a place to park. Additionally, walking through a neighborhood like the Fourth Ward in downtown Charlotte allows you to explain more about the neighborhood, and to actually get a feel for what life is like there.

The point of the article is that to live car-less, you need to have the items and services that you need close at hand, I have that in downtown. It talks about having a strong public transportation system, and Charlotte does have a strong system, though sporatic at times. As a frequent user of the LYNX Light Rail Line, I can tell you that it is well used all hours. I eagerly await the extension to UNCC.

Charlotte Area Transit System, CATS, has an app for either iPhone or Android which will allow you to find out when a bus or train will be at a particular stop. Generally, schedules are kept. This allows you to further plan your time.

Being car-less also encourages you to batch together errands. From time to time I will rent a car, and when I do I accomplish a number of tasks that would be more difficult on public transportation, going to Costco's, multiple appointments in different areas of the city in a short period of time, etc.

Eliminating a car from your overhead can reduce your expenses significantly. Think maintenance, gas, insurance, parking, carpayments or depreciation, replacement, etc. Add those things up. It saved me over $10,000 annually.

Put your own numbers in and see how it compares!

Continued Demand For Downtown Property

2011-11-04T07:28:00.000-07:00

The accompanyingchart illustrates the breakdown
of condo's that have, or are in the process of,changing hands, and the total number is 471 through the end of October. To be sure, the majority of the units are being rented by individualowners who choose not to sell due to market conditions.

Whilethat fact exists, the fact that the demand to live downtown is stronger than ithas ever been. Financially distressed properties in downtown are hoveringaround 16 units. Many of them are still on the market, or have returnedto the market because of lender underwriting issues. One of the mainconsiderations of underwriters is the number of owner occupants in adevelopment, another is the amount of homeowners delinquent on their HOA dues.

Investorswho can buy with cash, or mostly cash are getting the best deals in thismarket. Investor activity has increased significantly. The abilityto look at a property as an investment and not have an emotional attachment toit clarifies their ability to act firmly on what they consider a fairprice.

More Signs Of A Rebound In Housing

2011-10-25T12:52:00.000-07:00

Actually, not so much signs of an Upturn as signs that we have passed bottom. This link in a real estate publication cites several cities that have seen an increase in property values, and many more that have seen a lessening of property value declines.

Several things contribute to this, all related to supply and demand. I have chronicled here that sellers are either shelving plans to sell, or turning to the rental market to put people in their properties. Charlotte will have its best year for downtown property changing hands this year through either sale or rental.

Interest rates are incredibly low, have been for a while, and show no serious signs of creeping up. Lenders are being penalized for their past actions of loose credit, and chastised in today's market for being too tight!

I have seen many instances where multiple offers are being submitted on available properties. This usually is the start of a bidding, war at least on those properties.

Conventional wisdom states that the most important thing in real estate is Locatoin, Location, Location. A friend of mine in the industry has a different perspective, and that is Motivation, Motivation, Motivation!

I believe in the latter.

The Disappearing Seller

2011-10-18T07:49:00.000-07:00

A publication called the Real Estate Economy Watch has just posted this article which refers to the disappearance of property for sale. It sights reports indicating that nationally there has been a 20% reduction of available homes compared to the same time last year.

These statistics reflect a growing trend that is also evident in Charlotte. I have reported in this blog that the number of individual condos that will be rented this year will exceed 400 in the downtown market. Compare that to a little over 200 projected sales for this calendar year. That is an incredible swing.

When you include the fact that in MLS there is a small number (12) of properties in the downtown market that are categorized as financially distressed, and that over 70 are either sold or under contract, you are seeing a market that is retracting.

Many reasons exist for this, mostly the economy. Sellers are increasingly reluctant to sell their property at prices below what they either paid or are willing to accept. Many are staying in their property, delaying a move, or renting their property, sometimes even at a loss, as opposed to taking a big financial hit.

Some additional properties are in the process of navigating through the financially distressed stages, be it the foreclosure process or loan modification.

Whatever the cause, it is bringing back the laws of supply and demand. You can see by the increased numbers of people coming into the downtown area through either ownership or renting that the demand exists. What you are seeing is that the supply is dwindling!

My belief is that the bottom of the market has been reached, and the laws of supply and demand will begin to raise prices.

For those interested in getting a value, the faucet may be turned off.

Movement at 7venth Market

2011-10-06T14:49:00.000-07:00

It is good to see activity taking place inside the site of 7venth Market. I have talked with several vendors who are excited to become part of this market, and have spent some time with Christy Shi, the General Manager of the market. She is energetic and will be a great person to nurture this new venture into a successful venture.

Gone are the wine racks, and the food shelves that are standard in most grocery stores. Workers are rearranging the remaining usable fixtures into what will be the new configuration.

The Market is scheculed to be active by the end of November since all the regulatory requirements have finally been met. I am looking forward to becoming a regular customer once the doors open!

A Change Moving Forward

2011-09-24T13:46:00.001-07:00

As I like to say, there is nothing as sure as change (except from a vending machine). Everything changes, the weather, the economy, relationships, etc. So it is with the knowledge that change is constant that I decided to open my own Agency.

Please welcome Church Street Realty!

Center City Realty was the only agency I have worked for, and met a lot of nice people and great clients. I enjoyed working with the name that embodied my "primary market", downtown Charlotte, so the change for me was difficult, but I felt I needed to really narrow my focus to the 4.5 square miles that is downtown Charlotte.

I selected the name Church Street Realty to reflect one of the grand residental streets in the city. Certainly there are other streets, and other areas of the downtown that I will be with, but none with the strength of Church Street.

My mission statement is simple, "To engage with people who seek to find an urban lifestyle that will allow them to spend less time commuting and more time with their friends."

Being downtown is being in the center of the city. If you are a regular reader of this blog you know that I look for information and trends that affect the property values in the city, and even when things have looked bleak, this city did not experience the same depths of other cities.

We are emerging from the worst part of the recession and businesses are starting to hire, and there is evidence that property values have stopped dropping. Now is the right time for me to do this journey. I look forward to sharing this journey with you.

Is Florida Leading The Way Back?

2011-09-18T08:24:00.000-07:00

Go here to read an incredible story about a significant change in the real estate market in Florida

"August median prices in Fort Myers are up 33 percent from 2010. Miami is up 24 percent, Punta Gorda 20 percent, Sarasota-Bradenton 10 percent, Daytona 9.3 percent and Lakeland-Winter Haven 8.8 percent. Compare those increases to the national average increase for median list prices from all 146 metros tracked by Realtor.com: .46 percent."

Wow, who saw that coming?

I am sure that we are all aware that Florida lead the decline with all the overbuilding of condo's and spec houses when the market was peaking in the mid 2005 - 2006 era, and that despite the lofty increases noted above, they are still selling for below pre-2005 pricing, but the direction is positive.

It is one more sign that buyers, or perhaps investors, are evaluating the market and snapping up value where it exists. This trend, though not with the same percentage of increase, has come to Charlotte as well. The media keeps reflecting on the ups and downs of the market and average price of Charlotte, but they look at the entire metro area. My focus is on downtown.

Prices have stabilized to a large degree here. There have been several instances of multiple bids on a property, forcing all respondents to submit a best and final offer to secure the property. It is this type of activity that will allow prices to rise.

Kanvas, An Urban Nightspot

2011-09-17T04:39:00.000-07:00

A friend of mine told me he was going to hear some live jazz last night at Kanvas. I have known about Kanvas since it's opening about a year ago. A blend of Art Gallery and Lounge, I could not find when it was open, and never took the time to find out. That changed last night.

First, Kanvas is located in the Court 6 Condominium building located on the corner of East Sixth and Davidson Streets. It's tall ceilings give the feeling of a much bigger space. There is a well stocked bar, and soon will have a kitchen to prepare snacks. Currently, they have an arrangement with Kalu, and a special menu. Open Wednesday through Saturday from 6 pm to 2:30 am.

Live Jazz is featured every other Friday and the next live Jazz will be September 30th.

The music, art, and friends were great, but the best part is it is a 5 block walk from home! It is venues like this that make urban living more attractive,and the more attractive that lifestyle becomes, the more it affects property values.

New Yorkers Move To Charlotte

2011-09-09T06:28:00.000-07:00

While some of the numbers in an article in the New York Post seem a bit unbelieveable, the thrust of this article remains pretty accurate, go here to read the full article.

People in this article point to incredibly high property taxes, as well as car insurance, something that people seldom think about when talking about where they live. In this instance, a persons car insurance has been cut from nearly $3,000 to $850 a year.

As I repeatedly suggest, trends are something that happen slowely but consistantly. Look at the Colorado River's trend started some millions of years ago along a plateau which has developed into the Grand Canyon. The New York Post is responding to a trend that they can detect at their end that will benefit us. And they are not the only location, other cities are experiencing the same trend.

The cost of living here remains extremely attractive and that will be the driving force that will fuel the continued growth of our region. With these people come energy and excitement. With these people will come new companies both big and small.

Couple this with the planned structured growth of the five Transit Corridors and infill density. Existing properties will increase in value with the increased density.

The future looks bright for Charlotte.

Downtown Rental vs Sale Ownership Trend

2011-09-03T10:56:00.000-07:00

Thiseconomy is creating some interesting statistics. Available condo units forsale in downtown Charlotte are lower than they have been in over 5 years, andavailable condo units for rent are higher than they have been, ever! Ihave applied the information reported below from a national level and appliedit to a local graph of downtown Charlotte activity.

Housingaffordability continued to be near record highs in the second quarter, hoveringnear its highest level in the 20-plus years it has been recorded, according tothe NAHB/WF Housing Opportunity Index. 'At a time when home ownership iswithin reach of more households than it has been for more than two decades and(interest) rates are at historically low levels, the sluggish economy and tightcredit conditions confronting home buyers and builders remain significantobstacles to many potential home sales,' says Bob Nielsen, chairman of theNational Association of Home Builders. 'That said, however, some housingmarkets across the country have stabilized and are beginning to show signs of abudding recovery.' Source: NAHB

Theconversion of owner-occupied single-family homes into renter-occupied homes hasplayed an important role in stabilizing housing markets that have been wrackedby foreclosures, according to a report on rental housing. The Joint Center forHousing Studies of Harvard University report shows that 1.4 millionsingle-family homes became occupied by tenants during the 2008-2009 period, upfrom 700,000 in the 2006-2007 period. 'That is a tremendous surge in rentalhousing supply,' JCHS research director Christopher Herbert said during aWashington presentation of the report’s findings.

Theconversion from owner-occupied to renter-occupied data comes from the AmericanHousing Survey that is published every two years. JCHS managing director EricBelsky told National Mortgage News that he expects the next AHS report willshow a continuing surge in conversions in 2010. Source: National Mortgage News

Romare Bearden Park Is Underway

2011-09-02T12:07:00.000-07:00

I am not sure that I expected so many political personalities be on the agenda for this groundbreaking, but they were there in full force! The festivities started with the All Angels Church Choir from St. Michael Episcopal performing 4 songs. That was nice.

As the politicians began thanking all the people who made the park a possibility, my mind couldn't help but project to the completion of the park and how it will change Charlotte. The arbor and trellis entrance from the corner of MLK, Jr. Blvd and South Church Street will be a short walk from the Levine Cultural Center and turn that bland intersection into one full of life and activity. The particular topographics of the site drops around 30 feet from that point.

Charlotte, known for it's trees, will now bring hundreds more into this park and surrounding approaches. The lot opposite from 230 South Tryon will be reconfigured for a 25 foot wide promenade leading from Tryon Street to the park, giving it the impression that it is much bigger.

The park will force Poplar Street to terminate at West Third Street, eventually leading to both Poplar and Mint Streets to become a two way street. Currently, they are sometimes one way, sometimes two way streets. The intent of a one way street is to speed up traffic, a two way street has the opposite effect.

As the economy improves, adjacent parcels will cease to be just parking lots and instead continue to bring life into these approximately 25 acres of under utilized space. Across from the park going towards the railroad is where the new Knights Stadium is currently planned to go. This stadium will bring in somewhere between 5,000 and 10,000 people about 100 times a year. All that foot traffic will surely catch the eye of retailers and restaurants, and like spiders and their webs, those folk live off traffic.

The event ended with County Commissioner Jennifer Roberts operating a piece of construction equipment and knocking down the wall of one of the buildings being cleared for this park. She did so well that she may have a future after politics in the construction business!

What all this means for downtown residential property values is that as land disappears to projects, all land becomes more valuable. The rise may be slow, but it will be steady.

Clearing Up Terms About Distressed Properties

2011-09-01T15:21:00.001-07:00

Foreclosure, Short Sale and REO, frequent terms in today's real estate market. Yet, as frequently as they are used, people often don't know what they really mean. I have found a site that has a good definition of the three, and to read the article go here.

But for the condensed version, let me try to summarize:

FORECLOSURE

Foreclosure is the legal and professional proceeding in which a lender, obtains a court ordered termination of a mortgagor's equitible right of redemption. As long as this equitable right exists, the lender cannot be sure that it can successfully repossess the property, thus the lender seeks to foreclose the equitable right of redemption.

The foreclosure process as applied to residential mortgage loans is a lender selling or repossessing a parcel after the owner has failed to comply with an agreement between the lender and borrower. When the process is complete, the lender can sell the property and keep the proceeds to pay off its mortgage and any legal costs.

SHORT SALE

A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold. In a short sale, lender agrees to discount a balance due to an economic or financial hardship. This negotiation is all done through communication with a bank’s loss mitigation or workout department.

The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. A deficiency balance will remain as a potential liability for the Mortgagor / Borrower.

REO (REAL ESTATE OWNED)

Real estate owned or REO is a class of property owned by a lender after an unsuccessful sale at a foreclosure sale As soon as the bank repossesses the property, it is listed on their books as REO – Real Estate Owned – and is categorized as an asset (non-performing).

After repossession and the property becomes classified as REO, the bank will go through the process of trying to sell the property on its own. It will remove some of the liens and other expenses on the home and try to resell it to the public. Generally speaking, bank REO properties are in poor shape in terms of repairs and maintenance, however, purchasers will often go after these properties as banks are not in the business of owning homes and so, in some cases, the low price can more than compensate for the condition of the property.

Another Call For Action

2011-08-24T05:04:00.000-07:00

As if to endorse my previous post concerning taking action on our own and not waiting for someone else to "save" us, the CEO of Starbucks is calling for corporations to stop making campaign contributions to any of the elected officials of our country! Go here to read the editorial in the Seattle Times last Friday.

It is refreshing to hear this coming from a CEO of a company that regularly contributes millions to gain some political influence. It is not right and we all know it.

His call for action does two things, first, it cuts off the life blood of campaigning that seems to be all politicians care about, and second, it calls for hiring and investing, taking matters into our own hands and not waiting for someone else to make things better.

In this real estate market we are faced with similar decisions, or indecisions as the case may be. We are sitting in a perfect time to invest in real estate. Prices are incredibly low, interest rates are incredibly low, values abound.

If you are thinking of purchasing real estate, or have a friend who is interested in purchasing real estate in downtown Charlotte, please call me today, 704-236-7119.

Take that first step.

Time To Reboot

2011-08-22T06:10:00.000-07:00

I spent some time with a friend of mine, and a former Charlottean, over the weekend. As we walked around the city, looking at its strength, a diverse population, good weather, new construction, continued growth, moderate taxes, etc. My friend is an artist, and she "sees" things. She said it must be amazing to be here now.

I thought a lot about what she said. The times are difficult as a large part of my business has shifted from sales to rentals. At times, things can seem overwhelming. Her comments made me look back to what I have written in previous articles in this blog. Many articles concern new industries moving to this region. I have written about how a major complex, Fifth & Poplar, has seemingly turned the corner, and is now becoming a highly sought address. I have written of how the increased demand for downtown living, a combination of rentals and sales, is higher than it has EVER been.

Major issues like the Democratic Convention, the potential of downtown baseball, two new parks coming into the city, the expansion of light rail, UNCC opening a downtown classroom building, Northeastern University putting a location in downtown, Wake Forest Masters program moving to downtown are all filling the public debate, and all will add to property values

There is much to be excited about.

So when we read of housing prices being down or up from month to month, how do we reconcile those seemingly different stories. The data seems to have somehow gotten truncated or corrupt, it just doesn't seem to make sense.

The analogy here is that when our computers sometimes become crammed with remnants of programs, we need to "Reboot" the system to clear out the cobwebs. The government is not going to fix our economy. Multinational corporations are not going to fix our economy. We are!

We have all heard "Buy low, Sell high" well we are at the Low time. Valuation on available property is hovering around the 2003 levels, very affordable. Interest rates are at historic lows. Over 80% of the available financially distressed properties in downtown Charlotte have sold this calendar year, only 14 remain listed in MLS. Someone is getting the message.

We need to "Reboot" our thinking. As sellers we need to determine which is most important, the amount of profit from the sale of property, or moving on with life. As buyers we need to stop trying to figure where the bottom of the market is, and select a unit and a price that allows us to buy low. We control those things!

Things are different, and may never be the same. That does not mean that opportunities don't exist.

Reboot!

Move Towards Urbanization

2011-08-09T07:41:00.000-07:00

Here is part of an article from Inman News:

" The U.S. population is projected to grow by 150 million within the next 40 years and 'more compact, mixed-use development' is needed to handle the growth and changing demands, Patrick Phillips, CEO for the Urban Land Institute, told an audience at the National Association of Real Estate Editors annual conference this week. 'The design and development of urban areas will be radically different in the decades ahead,” he said. “We are seeing a push to make our cities more livable and sustainable.” One-person households are the fastest-growing type of household, he noted. Also, younger generations, in buyer preference surveys, are placing a higher value on the sense of community and are willing to swap extra space for convenience. An urban renaissance has been taking place with neighborhoods that are near urban centers becoming more desirable, Phillips said. Source: Inman News"

This trend bodes well for those who own property in the urban core. As more development starts to infill existing property will also rise in value.

Northeastern University Picks The Independence Building

2011-08-05T05:38:00.000-07:00

In my July newsletter I pointed out activity taking place at the former site of TheVUE 's sale center on the corner of Trade and Tryon. At that time, the occupant was "unnamed", but there sure was a lot of work taking place. This was in the August 5th edition of the Charlotte Observer, go here for the full article.

"After an 18-month study, the school announced in May it had chosen uptown Charlotte to make its first physical expansion outside of Massachusetts. It declined then to release information about the nine graduate programs, but disclosed details this week after a request by the Charlotte Observer.

In addition to the doctorate program, the offerings would include an MBA degree and master of science degrees in finance, taxation, project management, sports leadership, leadership, education and health informatics.

The doctorate will be among the few in the country delivered online and in the classroom by a "nationally recognized, top-ranked university," said Cheryl Richards, Northeastern's dean and chief executive in Charlotte. The school, Richards said, hopes to hear in October about the licensing from the UNC Board of Governors, the state's higher education licensing authority. If successful, it would start graduate programs in January.

The school must be optimistic: It has hired Richards away from Central Piedmont Community College and renovations are underway for its new uptown campus.

Northeastern couldn't have picked a more central site in Charlotte: 14,000 square feet on two floors in the 20-story 101 Independence Center at Trade and Tryon streets. It will have street-level presence, taking some of the first floor.

The school would depend heavily on drawing uptown working professionals.

"The campus in Boston is urban, right in the heart of the city where it can stay in touch with the growing needs of the business community," Richards said. "For us, it's really important to be at the center of Charlotte's growth."

This continued expansion of non-financial service industries in Charlotte will make the entire community stronger. Welcome NEU!

Signs Of Live At The Proposed Knight Stadium

2011-08-04T12:13:00.000-07:00

It appears that the Charlotte Knights have installed a "Home Plate" on the proposed location for their stadium. This coming on the heels of the announcement of Romare Bearden Park groundbreaking on September 2nd, and the county commissioners giving the Knights 10 more months to line up financing for a planned baseball stadium in Third Ward.

This is mostly a publicity ploy in my estimation but it is exciting to see some activity taking place at the site.

During the height of the condo building boom, a local developer had an option (maybe still does?) on the parcel on the southwest corner of MLK, Jr. Blvd. and South Graham Street nestled against the Duke Energy parking garage. Interestingly the project has the code name "Home Plate"!

Groundbreaking For Romare Bearden Park

2011-07-29T13:07:00.000-07:00

Please join us as we celebrate world renowned artist Romare Bearden’s 100th birthday with the ground breaking of uptowns newest park named in his honor.

Romare Bearden Park Groundbreaking Ceremony
September 02, 2011 9:00-10:30am
Corner of 3rd and Church St.

Be prepared for a unique experience unlike any groundbreaking ceremony you’ve ever attended.
Refreshments will be provided.

What great news this is! Several things to look for as the park develops. Poplar and Mint Streets will both become 2 way streets. The curved part of Poplar that currently goes to meet Mint Street by Martin Luther King Jr. Boulevard will disappear. Poplar will now dead end into Third Street. Fourth Street Will also become 2 way up to Mint Street. The curved portion of Fourth Street to meet Third Street will go away, making a larger parcel for the proposed Knights Baseball Stadium.

Go Here for the Parks and Recreation website for the Romare Bearden Park. The construction of the park will certainly be a difficult thing for the Panthers home games as three different parking lots / tailgate areas will no longer exist! Should be exciting.

Charlotte Is A Best Value City

2011-07-26T06:23:00.000-07:00

The Kiplinger Newsletter has proclaimed Charlotte to be the 2nd "Best Value" city in the country. Go Here to see the article.

This again points toward trends that are developing Charlotte. Great weather; great business climate; low cost of living; low taxes; and an educated labor market.

Much has been written about the Epicentre over the years, some good some bad. Some complain that Gahzi took advantage of the city and contractors with some lawsuits still waiting to be settled. Without getting into the legal ramifications of that, the accompanying picture of the Epicentre shows the impact that it is having on the city. There has been a significant move off of Tryon Street to College Street, and the Epicentre is a big part of that.

Most weekend nights finds the restaurants and bars packed. It is a true destination, and the location by the LYNX and the proximity to the Time Warner Cable Arena provide a steady stream of people.

Think back to the monolith that the old convention center was, and the hole that it put in the fabric of downtown. We have come a long way, and Epicentre has been a big part.

Possible Re-Birth Of The Encore On Tryon

2011-07-15T05:47:00.000-07:00

Go to this link to see the revised plan for the Carolina Theatre renovation and development. Originally, this was going to be a 20 story high end condo project with the quirky feature of having car elevators deposit your vehicle just outside your door, regardless of the floor you were living on! Quite a concept.

The recession and financial considerations by the developer has scrapped the original project in favor of a smaller building, but one that will assist in restoring the Carolina Theatre. This is a welcome bit of news as it will accomplish several things. It will remove an unsightly empty corner on Tryon across from The Historic Dunhill Hotel; It will renovate the Carolina Theatre into a functioning venue again; It will help to shift some entertainment back to the north end of Tryon Street, and signal a renewed interest in redevelopment in the First and Fourth Wards.

While the project is not a sure thing at this point, the concept and timing are great.

Dropping Foreclosures Across The Country

2011-07-14T07:45:00.000-07:00

Go Here for an article in the Real Estate Economy Watch which talks about the significant rate at which foreclosures are falling. The article is not a month over month knee jerk reaction to what is happening, but shows a developing trend in real estate.

Why foreclosures are falling could have many causes; loan modifications; short sales; recovery; and owners turning to renting to get through this economic recession.

I have been focusing on rentals over the past several articles and have activly encouraged many owners I talk with to rent instead of listing in this market. In fact, I am doing that with the properties I own. I would rather sell them, but renting is a viable option.

The fact remains that a property is an asset like any other asset you may own. While many people are reluctant to sell a stock that has taken a significant hit, think Bank of America or any bank stock, they appear more willing to sell their propety at a loss than continue to hold it.

Feeding a financially distressed property market more property will have the effect of extending the downturn and slowing the recovery.

More Rental Information

2011-07-11T09:45:00.000-07:00

The Rental Market continues to be hot. Previous articles have documented the increased activity both from a traditional rental building as well as condo owners looking to generate some revenue from their properties.

I have a friend who was looking for a short term furnished property to rent. My advice to him was to try the Catalyst. That building was born as a condo development by Novare. As they also built The Avenue, they did not want to interfere with the closing of The Avenue, they did not do presales. Unfortunately for Novare, the recession had hit when they finally started marketing.

Too late!

After frantically trying to sell the building, they hoped to convert it to half rental half condo, an interesting plan, but it failed to materialize. They finally decided to turn the entire building into rentals.

As of this writing, they are 98% leased!

Charlotte Regional Indicators Project

2011-07-07T12:29:00.000-07:00

Go to this site created by UNCC Urban Institute to get a wealth of data, charts, and speculation about the 14 county Charlotte Region. Normally I would limit my focus to just downtown Charlotte information, but found this to be extremely valuable. Listed below is information directly from the "About The Project" from the website.

The quality of life or well-being of a community is measured by many social, economic, and environmental factors. In the Charlotte region, it has become increasingly evident that these factors can only be effectively measured and addressed by crossing political boundaries and looking at the entire geographic area or region. Successful regional approaches to maintaining and enhancing the quality of life require tracking and assessing trends over time.

The Charlotte Regional Indicators Project does just that. It provides critical benchmarks measured over time and compared to state and/or national data for the 14-county, 2-state region, which includes Anson, Cabarrus, Catawba, Cleveland, Gaston, Iredell, Lincoln, Mecklenburg, Rowan, Stanly, and Union counties in North Carolina and Chester, Lancaster, and York counties in South Carolina. The Indicators Project provides objective, reliable, and relevant data that measure the region’s annual progress on a wide range of indicators that impact the region’s quality of life.

The Indicators Project focuses on ten theme areas: Arts, Recreation, and Cultural Life; the Economy; Education; the Environment; Government and Citizen Participation; Health; Housing; Public Safety; Social Well-Being; and Transportation, plus Demographics. Individually, the ten theme areas represent critical components of the region’s quality of life. Collectively, the ten theme areas provide a holistic framework that allows the region to better understand the inter-relationships among them.

Wealthy People Are Trading Up

2011-07-06T14:03:00.000-07:00

Here is an interesting article from a publication called the Real Estate Economy Watch. It alludes to the fact that wealthy people are using the current market conditions to trade up primary residences. I have not found this to be the case with high end condos in downtown Charlotte, but that trend may be changing.

While a third of homeowners struggle to stay above water on their mortgages, nearly a quarter of those in the upper income tiers have been trading up to take advantage of deals in the luxury home market.

Lured by lower prices, one in four U.S. consumers with annual income of $150,000 or more have bought a residential property since 2008 at a median purchase price of $509,000, up 3.2 percent from the 2005 to 2007 period. Most new residences (83 percent) are single-family homes and two-thirds of these are in suburban settings. Seventeen percent plan to purchase additional property this year, while 23 percent of those younger than 50 plan to buy in 2011.

According a new survey by the Luxury Institute and the Institute for Luxury Home Marketing, high net-worth homeowners are taking advantage of the downturn to trade up into higher-priced new primary residences. More than one-third (37 percent) of the wealthy value their homes at $1 million or higher, while 32% assess their primary residence to be worth $500,000 or less.

“Luxury homebuyers recognize that many premium homes are available at relative bargains,” said Milton Pedraza, CEO of the Luxury Institute. “Similar to the luxury retail landscape, luxury home sales provide more evidence of durability at the high end of the market.”

“Luxury is the good news story in real estate,” said Laurie Moore-Moore, CEO of The Institute for Luxury Home Marketing. “The number of wealthy households has jumped back to pre-recession levels and affluent home buyers are actively purchasing. The National Association of Realtors’ statistics show that national home sales at $1 million and above were up more than 18 percent year-over-year in 2010. Strong activity continues this year as well.”

Supply And Demand: Declining Listings

2011-07-02T10:24:00.000-07:00

The chart below comes from MLS history. It clearly shows the year over year decline of listings, whether traditional or financially distressed. It is reflective of several things, but they all relate to supply and demand.

Clearly, during the height (or depth) of the recession, property was not selling, many properties stayed on the market a long time with no results. Some of those properties slipped into short sale or foreclosure situations, some of those properties were made available as rentals by their owners, and some of the owners simply took their properties off the market delaying making a change in their lives.

Whatever the cause, the effect will lead to stabilization of prices, and a rise in property values, such is the law of Supply and Demand!

Five Trends To Watch

2011-06-30T07:54:00.000-07:00

Please follow this link to an article written to encourage realtors that the market is changing. If you read my blog, you know how I believe that trends will help us to map our way into the future. This article points to 5 trends:

Short-Term Pain
Over Development
Jobs
Lifestyle
Responsible Government

Attached is a bar graph showing the average dollars per square foot since 2000, including 2011 through June, and it suggests that we have fallen below 2003 levels. According to the Short-Term Pain trend, we have overcorrected. I think that will change moving forward, as 45% of this years sales have been financially distressed properties, and as of this writing, there are only 11 distressed properties available downtown.

The other 4 trends all bode well for Charlotte. We have not had speculation development, nor have we had broadbased job erosion.

Jobs in many varied sectors continue to be announced, almost on a weekly basis. Rumors floating around about Sears looking to relocate their headquarters looks attractive, but it is remote.

The Carolina lifestyle is certainly preferrable to most northern tier cities, and finally, we have a pretty responsive and pro-business government in the city and state that promote growth.

Follow the trends, and I will meet you in the future.

Changes In The Downtown Streetscape

2011-06-25T09:57:00.000-07:00

There are several changes that are taking place at the street level in downtown Charlotte that mark the return of investments in the city, most are restaurants. But first, a mystery guest is showing up in the Independence Building located on the Square. This former sale center site for The VUE is currently undergoing an upfitting, the actual tenant has not been named, but it should be a great addition at this location.

Nearing completion on South Tryon is Vapiano is putting some of the final touches to their location across from McCormick and Schmicks. After some permit delays, the Carolina Ale House is beginning their renovations of the ground floor of the Charlotte Plaza Building across from EpiCentre.

Activity will also be returning at 525 North Tryon Street in the site formerly occupied by Palomino's and then GWFin's. Delta's has papered the windows, and put up a sign indicating that they have begun their renovations.

Finally, I hear that Rooster's, the popular eatery on Morrison Boulevard across from South Park Mall will be opening a location in Founders Hall, or more correctly, on the College Street level side across from BLT Steakhouse. The College Street corridor is shaping up nicely.

Fifth & Poplar Set To Rebound

2011-06-24T06:17:00.000-07:00

One of the best locations for a residential building in downtown Charlotte has always been Fifth & Poplar. Originally announced as a condo development, the project initially got sidetracked by the terror attacks on 9/11. Interest in buying downtown immediately stopped, and the project was changed to a rental building. Around 2003/2004 the developer announced that they would convert the now successful rental complex back to its original plan, condos.

The market was hot again, the banks were hiring, and bonuses were flowing. It was a heady time. The downtown skyline was full of constrcution cranes, and announcements for new projects were popping up all over. In 2005/2006 there were 218 recorded sales in MLS for Fifth & Poplar with an average price per square foot of $345!

Mortgages were easy to come by, and a popular tool was the 85/15 mortgage, with the 85% being the first mortgage and the 15% being a ballooning second mortgage. Guess what, they have come due.

Not having anything else to go by, the county set the tax rates in line with the sale prices, so taxes were generally in the $400 - $600 per month range. All the amenities in the building also insured that the HOA dues would be high, $300 - $400 per month range.

Then came the crash! Jobs were lost, some people had to move, investors were having difficulties with finding renters, things had stopped working there. To further complicate the problem, problems with the building began to surface and fingers were pointed between the developer and everyone else. The HOA determined that an assessment needed to be levied and they took the form of a monthly assessment. This raised the HOA by another $100 or so per unit!

Last year there were 18 recorded financially distressed properties sold in Fifth & Poplar at an average price per square foot of $197, a drop of over 40% from the high water mark.

Yikes!

There is a light at the end of the tunnel however. The current market has only 6 active properties listed for sale, and only 2 of them are financially distressed. The recent tax re-evaluation has cut the taxes for most units by almost 50%, and there appears to be a settlement with the developer and the monthly assessment should be ending within 6 months. The repair work is nearing completion, and a more normal time seems to be looming. The general economy is showing signs of life as well.

The location and amenities remain as good as anything in the city. The values in this building have never been better, and the coming years should move the property values to approach their pre-recession levels.

Movement From The VUE's Developer?

2011-06-15T05:20:00.000-07:00

The VUE has been moving slowly on trying to close out contracts in place. Some of the contract owners sought to have prices reduced in order to close due to current economic conditions and were willing to walk from their investment. The VUE contracts indicate the developer can sue for damages over and above the initial down payment, and those issues are being decided in an appeal to the courts.

In the mean time, many of the contract owners are getting the following letter:

Dear X,

We have not heard from you in some time. We hope you are doing well. Initial unit sales at the VUE Charlotte have now passed the $15 million mark and we are writing to provide you with some information that may make it easier for you to close on your unit at the VUE.

If you require lender financing in order to purchase your contract unit, you should be aware of the following:

1. As an accomodation to buyers who close through our preferred lenders, we continue (without an obligation under contract to do so) to give those buyers $2,000 credits against settlement costs at closing.

2. One of our preferred lenders, Guaranteed Rate, is now offering up to 90% financing (at what we believe are very favorable and competitive rates) to qualified borrowers. Such terms aer of course subject to change without notice, and not all loan applicants will qualify. The contact information for Guaranteed Rate is as follows:

Matthew Coogan SRVP, Branch Manager

... matthew.coogan@guaranteedrate.com

http://www.guaranteedrate.com

You should also know that our sales team may have some flexibility to get creative in these tough economic times in order to facilitate unit closings and/or alternative resolutions for existing contract buyers. As always, contract and buyer situations are considered on a case-by-case basis. Nevertheless, and without committing to any action or agreement on our part, one or more of the following may apply in your case:

- We may in some cases consider waiving applicable late closing fees for buyers who close expeditiously

- In the event we have sold or are currently listing aq unit that we feel is comparable to your unit under contract, for a price that is significantly less than your contract price, we may in some cases consider reducing the price of your unit to make your price more in line with current sale prices and asking prices at the VUE Charlotte. You should know, however, that in many instances, units are in fact selling today and being listed today at prices that are higher than the prices in place under longstanding contracts.

We hope that you find the information in the letter helpful and informative. Candidly, we are really looking, during the next 60 days, to close units and to determine which contracts simply cannot close because financing is unavailable. As a result, we may be more willing to work with buyers (outside of the contract terms) now than we will be later.

In closing, and to be clear:

1. THIS LETTER DOES NOT CONSTITUTE AN AMENDMENT TO YOUR CONTRACT OR AN OFFER TO AMEND YOUR CONTRACT. THIS LETTER DOES NOT GIVE RISE TO ANY BUYER RIGHTS UNDER THE CONTRACT, OR RIGHTS TO REVISE THE SAME.

2. THIS LETTER DOES NOT CONSTITUTE A WAIVER OF ANY DECLARED OR UNDECLARED DEFAULT, OR WAIVER OF ANY RIGHTS WE HAVE UNDER THE CONTRACT, OR OTHERWISE AT LAW OR IN EQUITY.

3. CONTRACTS AND BUYERS ARE CONSIDERED ON A CASE BY CASE BASIS, AND WE HAVE NO OBLIGATION, AS A RESULT OF THIS LETTER OR OTHERWISE, TO AGREE TO ANY CONTRACT AMENDMENTS OR TO OTHERWISE CONFER ANY ACCOMODATIONS OR BENEFITS ON ANY BUYER. NO ACCOMODATION EXTENDED TO ANY ONE BUYER WILL IMPLY OR NECESSITATE THAT THE SAME (OR ANY LIKE ACCOMODATION) BE EXTENDED TO ANY OTHER BUYER.

4. YOU SHOULD NOT TAKE ANY ACTION FOR FAIL TO TAKE ANY ACTION IN RELIANCE UPON ANY EXPECTATION YOU MAY HAVE AS A RESULT OF THIS CORRESPONDENCE. THE MATTERS ADDRESSED IN THIS LETTER ARE SUBJECT TO CHANGE WITHOUT NOTICE.

This is an indication that the developer is trying to work with existing contract owners to close out on their units. As I have indicated previously, it is a great building and will not be duplicated in the near future in Charlotte. It will be wonderful to see it sport more lights indicating more occupancy.

Future Shock In Rentals?

2011-06-14T06:30:00.000-07:00

As the downtown condo market bottoms out, many owners are choosing to rent their property instead of settling for less than they consider fair market value in a sale. This trend is both local as well as national. MSNBC features this ARTICLE indicating that rental rates are going up.

I have indicated in previous articles that the demand for living downtown is greater than it has ever been. This has been fueled by many things, not the least of which is lifestyle. Over 600 units should change hands this year, and as that happens, most of those changes will be rentals.

Once again the laws of Supply and Demand take over. I have been working with several renters who initially wanted to negotiate down the price for a rental. What has been happening is that the rentals are being snapped up pretty quickly, creating a demand for the property, and pretty much eliminating any pressure on the owner to consider lowering the price. In each of those instances, my clients have lost out by not committing.

A quick look at YTD rentals of non-traditional rental properties, ie individual owners renting their own property, shows that 174 units have been rented, and the owners received 100% of the asking rental price

More News About The Rental Trend

2011-06-11T08:55:00.000-07:00

Earlier this week I wrote of the increasing activity in the rental market in downtown Charlotte. I have come across some supportive information concerning the national trend of increasing rentals. Go here to read the entire article. It outlines the 10 best markets for Real Estate Investors. There are several interesting points in the article. Here is a quote that I find is extremely relevent:

"The results of the analyusis mirror two major economic trends: population growth and improving employment. In the past decade, the South has seen the biggest jump in population, up 14.3% to about 114 million people according to the U.S Census Bureau. The second most populated region, the West, saw its population jump 13.8% to nearly 72 million."

While this article focuses on investors buying property at bargain prices and turning them into rent producing properties, it ties in with my findings that the rental market is doing very well, and that the desire to move into an urban environment is stronger than it has ever been.

As difficult as the times may seem for us, the trend holds great promise for Charlotte and the entire Southeast.

Is Refinancing The Right Decision For You?

2011-06-10T06:23:00.000-07:00

With interest rates still remaining extremely low, the thought of refinancing may make some sense to you. Determine what your motivation is and move forward from there. The prospect of reducing your monthly payments in this market may seem attractive, but it is a risk that things will improve in the near future.

Remember, refinancing will end up adding at least closing costs and probably more interest on the loan to save you some short term out of pocket expenses.

MSNBC has a good set of questions to ask yourself as you consider refinancing. Go here to see the article.

New Hotel Coming To EpiCentre Replacing 210 Trade Condo's?

2011-06-05T17:17:00.000-07:00

Back in February when Charlotte was named the host city for the Democratic National Convention, I made a number of predictions. Here is one of them:

"It has already been announced that The Park will begin its reconstruction early this year. The new configuration of The Park will create over 100 hotel rooms in addition to over 80 condos. Its location between the convention center and the arena almost guarantees its success. I would also expect to see the Two Ten Trade site be reconfigured into a major hotel. Situated in the heart of the city and across from the arena, this site is begging to be completed. It will be a shame that the residential market will not be in a position to take it, but a hotel there makes sense."

Well, The Park, now called Skye, is a beehive of activity, and a number of rumors have surfaced that an announcement is forthcoming that the former site of 210 Trade Street will become the site of a major hotel, and that hotel chain appears to be a W brand. The fact that the foundation is already there to support a 50 story building, an intensified construction campaign could have it built in time for the DNC in late August 2012.

This bit of news will also cast a lot of attention on the cleaning up of the Transportation Mall, the site of a recent fracas following the closing of Speed Street. There may even be renewed interest in relocation of the Transportation Mall, though that would be difficult.

Stay Tuned!

The Demand For Downtown Property Is Returning

2011-06-05T07:02:00.000-07:00

There has been much talk lately about renting vs owning. There are accompanying articles that talk more directly as to the nature of rentals, but this article is addressing more the demand side of what is taking place in the downtown Charlotte market.

I tried in vain to produce this information in a graphical format, but when I recognizing the difficulties of trying to size the graph correctly in this eZine, I decided to just include the table itself. The graphs were all too busy and the data points would be too small to easily see. The data is YTD 2011 for downtown Charlotte.

The nature of my study was to look at the downtown Charlotte condo market in three slices, Non-distressed, Distressed, and Rentals. For the rental slice, I have taken out rentals that were in traditional rental buildings like the Tryon House on Tryon. Also, all the data analyzed here comes from the MLS system. It should be noted that there are sales and rentals that happen outside of that reporting structure.

All the data in this analysis is year to date. So here comes my analysis! The first five months of 2011 has delivered 258 properties either sold, leased, or under contract. Projecting that out over a full year can be difficult because some months are stronger than others, but just using straight math it calculates to over 600 units in a years time!

Non-Financially Distressed properties are selling. A large reason for that is that current owners are pricing their properties more in line with current market conditions. It is difficult to sometimes look at our homes as an asset, but that is what needs to happen. Proper pricing in a market like this one can, and sometimes does, lead to multiple offers. I have seen evidence of units being sold for greater than the asking price, a sign of multiple offers.

Financially Distressed properties are selling at a rate of nearly 5 to 1 YTD downtown, and there are currently only 10 available. The return to a healthier housing market will depend on the foreclosure problem being lessened.

I will repeat that the rentals indicated here are not traditional Rental Properties, but individual units located in condominiums such as Fifth & Poplar, The Avenue, 400 North Church, ChapelWatch, etc. They are the result of owners not being able to sell their property in this market, but finding a way to lessen the impact of the financial strain, or perhaps just waiting for a healthier real estate market to emerge before selling.

With respect to the laws of Supply and Demand, the most important considerations in real estate are motivation, motivation, and motivation! How motivated is a property owner to reduce the financial burden of a property? How motivated is a buyer to move into an urban market? It appears clear that there is enough motivation to begin to bring us back to a stable market and a return to increasing property values.

2011 Projects To Be A Banner Year

2011-06-05T07:01:00.000-07:00

Further analysis of the downtown condominium market shows that there has been a rapid increase in rentals from 27 in 2005 to 328 in 2010. Couple this rental activity with sales activity and this year, 2011, projects to deliver 618 units in the downtown market, exceeding even 2007 the previous peak year.

The ratio of rentals vs sales changed in 2009 to be over 60% rentals. There are several reasons for this. The first reason was mentioned in the previous article, owners cannot sell their property for the value they perceive it to be, and renting is a way of pushing an eventual sale into what many believe will be a stronger sale market. Secondly, many of the units in buildings that entered the market at its peak, Courtside, Court 6, Fifth & Poplar, The Avenue, TradeMark and 230 South Tryon, were purchased by investors with the intent to use the property for rental.

This dynamic has cause concern among most of the Homeowners Associations downtown. Renters generally do not share the same concerns that owners have for the general upkeep of the common areas. A further issue is that many lenders view the percentage of renters in a building as a potential red flag once a mortgage application gets to underwriting. In today’s credit market, lending has become much more restrictive than it was 5 years ago. It is not uncommon to see a MLS listing from Fifth & Poplar with the caveat that indicates that only cash deals will be considered.

If you are wondering why an optimistic person like me is bringing some of this seemingly scary information forward, the reason is simple. The demand to live downtown has never been higher. Gas is taking an increasing amount of disposable income from people. The auto industry is building its rebirth around smaller, more fuel efficient cars. An urban life style of walking to work, entertainment, dining, and shopping, remains attractive.

The trend is clear. I expect that rentals will cool off somewhat and sales will once again become the predominant path to living downtown, and a return of property values.

Nothing New At The VUE

2011-06-05T06:57:00.000-07:00

Just a quick update.on The VUE. I have heard no news at all from the developer, a blog that focuses on The VUE, or the courts that are considering an appeal that the developer has filed to support his request to sue for damages for people who decide to not close. The case is not over yet.

Looking through the recorded tax records in Mecklenburg County show that 14 units through May 31, 2011 have actually closed. The developer claims an additional 200 contracts are subject to close based on the court cases.

It remains a beautiful building, one that will not be duplicated again for at least 10 years. The views are spectacular, and the amenities are luxurious. There will surely be more to come about this property.

Bits Of Positive News From Various Sources

2011-06-05T06:55:00.001-07:00

Listed below are a variety of news bits that address the state of the real estate market and the prospects for its improvement. There was an article in the May 31st edition of the Charlotte Observer indicating that housing prices in Charlotte have declined an additional 6.8%.It is a shame that that a scare tactic like that is forcing buyers to be more demanding.

Consider that this is a buyers market and the number of financially distressed properties that have sold have caused sellers to reconsider their options. Other articles in this issue address the fact that financially sound sellers are choosing to rent as opposed to sell below the true value of the property.

• A report from the Housing Opportunity Index indicated that almost 75% of all new and existing homes sold in the first quarter of 2011 were affordable to families earning the national median income of $64,400.

• “With interest rates remaining at historically low levels, today’s report indicates that homeownership is within reach of more households than it has been for more than two decades,” says Bob Nielsen, chairman of the National Association of Home Builders (NAHB) “While this is good news for consumers, home buyers and builders continue to confront extremely tight credit conditions, and this remains a significant obstacle to many potential home sales.”

• Price declines will end and average U.S. home prices will stabilize by Labor Day. Prices in even the hardest-hit markets will level out by the end of 2012. That’s the latest prediction from the authoritative Moody’s Analytics and Fiserv, Inc, after an analysis of home price trends in 375 markets tracked by the Fiserv Case-Schiller Indexes.

• Fiserv also reports that home prices are at pre-bubble levels, creating affordable housing relative to income which, coupled with a slowly improving economy, will finally end price declines.

• However, while Fiserv and Moody’s project the national U.S. home price average will stabilize in the third quarter of 2011, a 3 percent decline is expected in the first half of this year. “The first step toward restoring confidence in housing markets is an improvement in consumer sentiment, which we expect will increase slowly through 2011 due to stronger job gains and a falling unemployment rate,” says David Stiff, chief economist, Fiserv. “As confidence rises, the decline in home sales that started in 2006 will, finally, come to an end.”

• News released early last week that housing starts and permits were down. New homes are finding it hard to compete with all the great prices of existing listings out there. How could this be good news? When new home construction slows it certainly hurts overall economic growth. However, construction of fewer new homes makes room to get rid of excess inventory caused by foreclosures. In other words, fewer new homes built represents good news as long as existing home sales continue to increase in strength.

• The trend is up for existing home sales which have unevenly increased in six out of the last nine months. Americans continue to see a buyer’s market in housing, according to an April 2011 Gallup poll. Sixty-nine percent of respondents say now is a good time to buy a house.

The Beginning Of The First Ward Park

2011-05-21T14:27:00.000-07:00

Dirt is being turned on the corner of West Eighth and Brevard Streets in the First Ward. The UNCC Downtown Classroom building is nearing completion and is scheduled for a fall opening, and the accompanying parking deck and public park is about to begin. This reshaping and redefining of this area will be a welcome change to the surface parking lots that have been there. Go here for construction diagrams of the park's layout.

This park has been long delayed but signals a start to North Tryon activity that has the potential to reshape the First and Fourth Wards similar to the fashion that the Levine Museum Complex has reshaped the Second and Third Wards.

The major difference between these two sections of the city is that there is a much higher concentration of residents already living in the First/Fourth Wards

The Sign Says Coming Soon!

2011-05-21T14:22:00.000-07:00

Located on the northwest corner of West Third and Graham is a small sign that is announcing that the site is the future home of the Charlotte Knights. While it is great to see that sign, how soon is coming soon?

I have tried to go through my usual contacts for some indication that activity is taking place, but have been unable to get any kind of update. This much I do know. Jerry Reese has run out of appeals on all of his various legal actions against the county, though he claims he is not finish yet.

My belief is that the construction of the stadium will be underway by the time of the Democratic National Convention for these reasons. A vote by the county will be coming this summer to decide whether to begin construction of the Romaine Bearden Park. That should be an easy decision. The Knights have a payroll of close to 70 people, they all pay taxes to South Carolina, a move to Charlotte will require taxes be paid to North Carolina. Currently that area is not generating any tax revenue, whether property taxes or payroll taxes.

The empty space in the Third Ward between Tryon and the railroad tracks MLK Blvd and Fourth Street encompasses close to 20 acres. By comparison sake, the Levine Arts Complex with the Duke Energy Center covers about 6 acres. The Third Ward site needs something to kick start development, and a baseball stadium would do that. The stadium will bring in excess of 500,000 people into the Third Ward covering over 70 events. That kind of traffic draws development. And finally, construction costs will never be lower.

Once this project gets underway, the level of activity will increase the desire of living in the downtown area, and since new construction is down, existing home prices will begin to stop their downward spiral and property appreciation will return.

How To Figure The Right Price For A Property

2011-05-21T14:19:00.001-07:00

In buying or selling a property, there are some guidelines that can be helpful in determining a price.

What are the comparatives? While similar or nearby homes have a bearing on the price they are not always the definitive or decisive reason. That said, getting comps sets the pricing bar as far as determining the fair market value. Keep in mind, and appraiser sent by the bank will do a more detailed comparison to deliver to the bank what price the property should be worth.
Recent sales are the key. Going too far back and you might be viewing a different market. If you do get into contract, these may be the same comparables which will be considered by the appraiser, so looking at them before making an offer can:

How much can you comfortably afford? This is much more critical for buyers than for sellers. Prior to finding the house of your dreams, talk to a mortgage broker to see what you can qualify for. Keep in mind also that the mortgage market is competitive, and rates can fluctuate. Some lenders will have underwriting restrictions that need to be considered. Bottom line is that your payment should be something you can live with.

How many others are bidding on the property? This is another step at which it’s critical to check in with your agent. You need to know what level of competition you’ll face. Buyers should be aware of the competition that could exist for properties. Even in today’s market there are properties that will command multiple offers. I can help you properly value a property, and keep your offer in front of a seller.

How badly does the seller need to sell? Buyers: Has the property you’re interested in dropped in value? How long has it been available on the market. Sometimes a listing or a listing agent will indicate that the seller is highly motivated. That is usually a sign that bargaining room is available.

How badly do you want to buy, or sell, the place? This is all about you – what is your level of motivation? It doesn't make sense to offer more than the list price just because you have become emotionally involved with it, unless you have more cash than you know what to do with. But within the range of the fair market value, it may make sense to move higher within that range if you are highly motivated to get that particular property.
Sellers: think of your list price as the most powerful marketing tool at your disposal. if you really want or need to sell, get aggressive about setting your price as low as makes sense for your your home's value and local market dynamics to attract qualified buyers and help your home stand out against all the competition

My Review of Roku XD Player

2011-04-30T13:14:00.001-07:00

Originally submitted at Roku

The new XD steps it up with 1080p HD video quality and extended-range wireless.

Good Bye Time Warner

By Uncle Dennis from Charlotte, North Carolina on 4/30/2011

Pros: Compact, Easy to use, High quality picture, Built in Wi-Fi, Easy to set up, Great value

Cons: The remote can be finicky

Best Uses: Living room, Primary TV

Describe Yourself: Technophile, Netflix fan

I was getting tired of over spending for cable tv that never had anything good to watch. I found out about Roku and made the plunge easily. I have cut my cable bill by a lot. It was interesting that when I dropped the Cable TV from Time Warner, they contacted me and offered me the entire package I had for less than I was paying!!!!

(legalese)

National Trend For Living Downtown

2011-04-26T05:45:00.000-07:00

Here is a part of an USA Today article on Urban Living:

Living downtown is becoming increasingly appealing to college-educated 20- and 30-somethings. In two-thirds of the country’s 51 largest cities, the college-educated population in the past decade has grown twice as fast within 3 miles of urban centers when compared to the rest of the metro area, the USA Today reports. That is a jump of 26 percent, on average, compared with 13 percent in other parts. Young adults with higher education, in particular, seem to be showing a preference for urban living. Young adults with a four-year degree are about 94 percent more likely to live near urban neighborhoods than less-educated young professionals. (In 2000, that number was about 61 percent.) Even floundering downtowns are attracting more young people. For example, Detroit, which has faced a 25 percent drop in its population since 2000, has added 59 percent (or 2,000) young and educated residents during that time, according to Impresa Inc., an economic consulting firm. Looking to keep the young vibe going strong, Detroit even has recently launched a campaign — ”15 by 15” — to bring 15,000 young, educated professionals to live in the downtown by 2015. To do that, they are offering cash incentives: A $25,000 forgivable loan to buy a home in downtown and stay there for at least five years or $3,500 on a two-year lease. Source: USA Today

This story reminds me of a client (and friend) who moved to downtown Charlotte in 2005 from Boston. As part of our tour of properties, I touted the growing number of options downtown for young professionals. His comment recently to me was that when he moved here, it was Fox and Hound and Rock Bottom and that was really all the night life. Now with Epicentre in full swing, the options are significant.

March 2011 Shows Significant Movement Downtown

2011-04-12T06:59:00.000-07:00

I was doing some analysis work and a client of mine sent me an eMail asking about March sales downtown. I did a recap of sales and properties that have gone under conract in March, and the summary is here.
The numbers show that 25 units sold in March, and 22 units went under contract. That is a pretty significant number as things continue to improve. Of that total of 47 units, 32 were under some form of Distressed Financial Condition. The average $ per Square Foot for the 25 sold units was slightly under $199.
The keys here are that there is a significant increase in activity. Property re-evaluations have come out, and many properties have had their taxes reduced, most noticibly at Fifth and Poplar. Interest rates remain low, though rising slowly, and the low hanging fruit of short sales and foreclosures are being grabbed.
Look for this trend to continue.

The Continuing Saga Of The VUE

2011-04-05T07:46:00.000-07:00

No newsletter would be complete without some information about The VUE. I look at The VUE everyday from my condo, and see pockets of lights in the building. The official tally is that as of this date, April 1, 2011, 16 units have closed.

The developer has been willing to be creative with some buyers to allow them to buy down to other units less expensive, and to move their deposits with them. This may not be an ideal solution for buyers, but it can be helpful.

MCL, the developer claims to have approximately 200 contracts. Today, it was announced that a buyer cannot be forced to purchase a unit they have contracted for, or pay damages as claimed by the developer. They will still lose their initial deposit though.

This ruling should clear the way for closings to begin to take place. Some buyers were waiting to see what the ruling would be in hopes that they would be able to secure their initial deposit back, but that appears not to be the case. The big part of the ruling is that the developer is not entitled to any monetary consideration outside of the deposit itself.

The building itself is really quite marvelous. The amenities are well thought out, and the location is great. The views from the building are pretty incomparable. What the building desperately needs is occupants.

If you wish to take a tour of the building, please contact me to arrange one, I never get tired of going in to The VUE.

In the mean time, what does that mean for current property owners? Currently in MLS, The VUE has 3 properties listed, and they average around $526 per square foot. In 2010, the average price per square foot in the Fourth Ward for a closed transaction was $230. That 2010 price included financially distressed properties, which deflated the value of the sale. So, lets make some assumptions.

1.) The economy is getting stronger, people are feeling better about their jobs, current companies have resumed hiring, and other businesses are relocating here.

2.) With the first lawsuit settled (though it will be appealed) other buyers will need to make hard decisions as to whether they can walk from a significant deposit. For this purpose, lets assume that the majority of the buyers do not walk away.

3.) As more units close (based on assumption #2) there will be renewed interest in new sales in the building.
I cannot make any assumptions as to the developer restructuring the pricing for the building.

My belief is that a renewed interest in the downtown condo market will lead to an increase in the sale of units in other buildings that offer perhaps larger space as well as other amenities. Couple this with the number of financially distressed properties diminishing will lead to the recovery of the market.

Trends Of Financially Distressed Properties

2011-04-05T07:44:00.000-07:00

There appears to have been a slight dip in the sale of Financially Distressed Properties over the last few months. This could be good news, or it could signal that banks are taking more time to put property on the market.

In the past, banks have put REO property on the market with little or no repairs or improvements, leaving that entirely to the buyer. The thought behind this was to price the property so low as to make it move and let the buyer do the repairs. That was in a normal market!

Today's market is acting much differently. Any buyers in a position to purchase are being much more selective, and banks are finding that they are sitting on property longer, and settling for less for the sale. They have seen the wisdom of making necessary repairs, and even making improvements to increase the value of the property. This is more a reflection of the laws of supply and demand than anything else.

Another interesting trend is that buyers are having a much more difficult time in obtaining a loan for a property. Not necessarily because of their financial condition, but more reflective of the property itself.

I hate to pick on Fifth & Poplar, but the combination of rentals in the building, along with delinquency in paying the HOA dues are causing underwriters refuse to give a loan for that property in some cases. The good news for Fifth & Poplar is that the current property re-evaluations have significantly reduced the tax value and therefore cutting the taxes in half in some cases.

In the current downtown Charlotte market, 84 units have either sold or are under contract, 33 of which are Financially Distressed. In 2010, 33 units sold and 5 were financially distressed. Clearly the market is picking up steam.

As The Economy Recovers More Jobs Coming

2011-04-05T07:27:00.000-07:00

The above articles talk about some of the trends that are leading to a recovery, but the main issue will remain JOBS. Sometimes it is hard to tell because most media outlets like to lead with doom and gloom, but hardly a month goes by without an announcement that another company is moving its operations to Charlotte.

Most recently is HVM Corporation, the parent company for Extended Stay Hotels. They will be bringing about 170 jobs from Spartanburg to Ballantyne. The Veterans Administration is planning a major hospital facility in Charlotte. The banks are changing their mix of departments but in general are hiring.

Mark Vitner, a senior economist for Wells Fargo & Co. is optimistic for Charlotte because he believes the U.S. is fundamentally shifting toward a more capital-intensive economy versus a labor-intensive one. A capital-intensive economy requires a highly educated workforce, which Charlotte has.

As these jobs continue to come to Charlotte, other trends will also come into play to intensify the desirability of downtown as a residential environment. Gas prices will be a key factor; lifestyle changes will encourage people to live closer to where they work and where they play. Charlotte's downtown is poised to take advantage of that, and property values will reflect that as well.

A Word From The New Reid's

2011-04-05T07:25:00.000-07:00

It's funny, I still carry around my Reid's Rewards Card on my key chain even after 9 months! It is still sad that the Seventh Street Station location closed. I had lunch recently with Chuck and Pam Richards, and while Chuck is out of the day to day operation, Pam remains fully engaged in the Gift Business.

I asked Pam to write a few words for me as Reid's prepares to reopen on Selwyn Avenue by the end of April.

Its always tough when you hand a huge chunk of your life over to someone else. It was with great trepidation that Chuck and I sold Reid’s and turned the wheel over to new ownership. This change is proving to be one of the most positive and fulfilling moves that we have ever made.

Reid’s does indeed now have a dynamic new leader, Tom Coker Chuck and I both feel that Tom has the best interest of the store in mind and the means to make it work as it used to at the old Myers Park location. The new Selwyn and Colony store is going to be a great palette for the expression of all the special things that Reid’s has stood for throughout the years.

I am very proud to be a member of the team that will be a part of the new Reid’s at opening in late April. Tom has hired many of the key staff from the 7th Street Store to make sure the same feel and level of service will continue. We hope that each of you will find you way to the new store, visit Bucky in the meat market, have a glass of wine at the wine bar and maybe a sandwich or salad at lunch time.

The best is yet to come.

Pam Richards

Results Of Irrational Exhuberance

2011-03-20T15:19:00.000-07:00

The period between 2005 - 2008 were the height of sales and optimism in the condo developers community in Downtown Charlotte. It seemed like all you had to do was announce a new project, apply some pricing, and people would line up to buy.

As we all know, the financial crisis has thrown cold water on any new developments, and has slowed down the closings at properties like The VUE. Financially distressed properties have taken about a third of all sales in the downtown market in the past 12 months. The developments hit hardest are Fifth and Poplar, The Avenue, 230 South Tryon, Courtside, and Trademark.

As this chart indicates, there have been 60 sales in these five complexes over the past trailing 12 months, and of those, 90% have been financially distressed. Fifth and Poplar has the most loss from the LMS (Last Market Sale) at 53%, while TradeMark has had a stronger retention of value, though the number of unit sales is not the same.

This reaction in the market place highlights the influence of investors buying as the market was turning, not giving them the opportunity to flip their investment to make a profit. Additionally, mortgages during the initial sales cycle of these developments were easy to get, and the amount of downpayment necessary to secure a loan provided the banks with most of the risk in these transactions. As we know, many of these mortgages were bundled and sold off.

An ironic twist to this scenario is that a property such as Fifth and Poplar has forced many of the current owners to rent their units as they scale back, and perhaps move in with friends. Couple this with an ongoing assessment which is pushing the HOA dues in that building higher than most and things become difficult. When a property does sell, an underwriter will look at not only the percentage of units not owner occupied, but also the percentage of owners past due on their HOA Dues. This often will lead to an underwriter turning down an otherwise capable buyer due to the inherent risk of the property.

All of these properties remain attractive, and as the sale of distressed properties continues, these five developments will provide the best return for those able to obtain loans. The attractiveness of the prices available coupled with historically low interest rates makes this the ideal time to buy.

Wake Forest University MBA Program Finds A Home

2011-03-15T06:51:00.000-07:00

An announcement is coming today (3/15/2011) as to a site selection for the Wake MBA Program landing at the World Trade Center located on the corner of North College and East Fifth Street. This is great news for creating additional life in that corridor of the city.

Click on the link to get more details.

More About PEV's (Plug-in Electric Vehicles)

2011-03-10T12:51:00.000-08:00

Nissan was at the Square today, (by the Marriott Center City), and was offering demonstration rides in their Electric Vehicle, The Leaf. It is not a Hybred, this car is 100% Electric. It is about the size of a Toyota Prius, and handles pretty much the same. Being Electric, the gear shift is kind of funny, push down and over as opposed to actually meshing gears.

The demonstration and test rides were part of a campaign by Duke-Energy and Charlotte Center City Partners to demonstrate the practicality of PEV's. This particular model gets about 100 miles on a charge, or about the same as 7 round trips from downtown to SouthPark. Based on gas prices at $3.50 a gallon, and a car getting about 25 miles per gallon, 100 miles would cost your about $14 in fuel with an internal combustion engine.The same trip in an Electronic Vehicle would cost about $3.30, for a savings of $10.70 for every 100 miles you drive. If you drive 10,000 miles per year, the difference would be $1,070 - Every Year!

To be sure, a charging station in a condominium for your personal use would have an initial cost of around $1,200, but that would be a 1 time cost. Additionally, there are Federal Tax Credits available, so the costs would be somewhat mitigated.

The Nissan Leaf I drove has a MSRP of $32,000, so they are not cheap. But the interior creature comforts are not lacking and the sound system is good. So, PEV's are coming. There will be early adaptors and later comers on, but it is enevitable that this is the future we have in store.

As Gas Prices Rise

2011-03-07T08:11:00.000-08:00

I have written a few times about the coming move to PEV's (Plug-in Electric Vehicles). Charging stations are currently available in limited areas, and Duke Energy is looking to expand their installation.

The news over the past several weeks has been chronicling the increase in the price of a barrel of gas, and the consequences at the gas pump. Charlotte prices have risen to over $3.50 per gallon. The magic number seems to be $4.00 per gallon for people to begin to make significant changes in their lifestyle. Once that threshold is reached, it is thought that more people will consider public transportation as a serious option.

With the unrest in the Middle East, Libya in particular, the price should continue to climb. When it ends, the price will probably abate some, but there is no real doubt that the long term view has gas prices rising and staying at an elevated level. Remember, there are only so many barrels, and both China and India are in huge expansion modes.

Charlotte is ahead of the curve as to the conceptual development and execution of a comprehensive transit plan focusing growth in 5 major legs, one having already been built, and another about to begin. This access to public transportation and a strong core and corridor plan will focus on increasing property values on any area that is convenient to transportation.

Downtown residents should take heart in this.

Interesting Housing Market

2011-03-04T06:53:00.001-08:00

Many cities are reporting that Depressed Properties are becoming as high as 49% of the transactions. While that is not really hard to understand, as many homeowners who can wait out the market are doing so, it does represent a significant change from the past. Couple that with the fact that slowly rising interest rates are cooling off the number of first time home buyers in favor of investors.

Remember, investors are the ones who seek to profit by purchasing property below the market value, whether the property is move in ready or not, and reselling it for a profit. Nationally, in the past 12 months, the average price for damaged bank owned properties has declined by 16%, while move in ready bank owned properties have declined 20%. In comparison, non financially distressed property has only declined 4%.

Lenders are also becoming more choosy when lending on properties. Underwriters are making more demands, and time to closing is approaching 60 days. While we have not had that severe of a reaction here in Charlotte, we have noticed it.

As an offshoot of this, the number of investors willing to pay cash for a purchase has significantly increased. There are two primary reasons they are doing this; first, to encourage the seller / bank to give further concessions as fewer things go wrong with cash, and second, time to closing is shorter.

All in all, many are predicting an 8% - 10% increase in existing home sales this year.

Two Bits Of Transportation News

2011-03-04T06:52:00.000-08:00

Duke Energy has recently announced plans to create a $1.2 m PEV (Plug-in Electric Vehicles) pilot in the Carolinas. There are issues to be addressed as this technology goes forward, such as will transformers need to be upgraded, will peak power need to be upgraded, etc. Ideally, home users will be able to charge overnight, when peak demand is low, but those patterns need to be understood.

At least one downtown Condominium has approached Duke to become part of the pilot, noting that the potential for many users in a relatively small area can be addressed. Also, many of these condo residents tend to be early adapters, and would give Duke a pretty good read.

With the turmoil in the Middle East, and gasoline prices seemingly heading to $4 a gallon, I would expect to see much more interest in PEV's.

The second item is that Columbia, SC city leaders have come to Charlotte to discuss the initial concept of installing a commuter rail corridor running from Columbia to Charlotte. The implications of this are clear, Charlotte will be on the High Speed Rail Corridor between Washington and Atlanta, and the status as a Hub on that line will expand rail services in several directions. This is not something that will be happening in the near term, but now is a great time to begin exploring the possibilities.

Charlotte's Amtrak Terminal will be located in downtown Charlotte on Graham and Trade Streets.

More Signs That The Bottom Is Here

2011-03-04T06:50:00.000-08:00

In an article on Sunday, February 27, 2011, the Wall Street Journal gave reasons as to why 2011 might be the end of the Housing Crash. They give reasons to be optimistic, and project that it might make sense to jump into real estate.

Housing is more affordable than it has been for decades. This may actually be the redistribution of wealth that many conservatives were worried about during the last presidential election, though the cause of the redistribution is squarely

placed on Wall Street.

Nationally, the cost of a house is equivalent to about 19 months of total pay for an average family, the lowest level that has been at for 35 years. This is the first time I have heard of ownership in those terms. Trying to use that number specifically for just the downtown Charlotte market is difficult due to the lack of data indicating the average income for downtown residents.

When the bottom was / will be reached is difficult to pin down, but everyone agrees that the worst is over. Prices are historically low

, and even another 5% drop on a $200,000 home would only result in $10,000 in savings, or about $50 per month.

Another interesting change is that FSBO (For Sale By Owner) are becoming increasingly rare. Owners are realizing that they often will surrender more than the 6% commission when getting involved in the negotiation and process of a normal sale of a property. Something as simple as pricing the property can become an issue if a subsequent appraisal does not support the owners view of the property's worth.

County Wide Property Re-Evaluation

2011-03-04T06:48:00.000-08:00

It sure didn't take too long for the switchboard to light up at the county assessors office once the single family home assessments were mailed! I have a friend that has a parcel in downtown Charlotte that has gone from $300,000 to over $700,000 in value according to the county.

Wow! So what is in store for us condo and townhouse owners. Figures will be released this month to cover everyone not covered in the initial roll out. Before you accuse the county of being unsympathetic to the current economic climate we find ourselves in, be aware that the county is required by law to re-assess every 8 years.

I know the attached chart is difficult to read, I am still working with my provider to be better able to provide pictures and charts in my newsletter, but the trend is unmistakable. The numbers I am using are only condos and townhouses, and only in the downtown area. Over the years, there have been individual events that have affected the value of property, such developments such as Fifth and Poplar, TradeMark, The Avenue, they all inflated the average $ per square footage when they came on the market. Many of those sales now are dragging the market down.

I have an 11 year history of $ per square foot prices for all the downtown Charlotte associations, and will be happy to deliver you a spreadsheet enumerating those values. Please eMaill me with your specifics, and I will send you the results for your building.

The information that I use is from MLS. I cannot guarantee you that the county will accept your petition, but at least I can supply you with enough information to make it an even fight.

The VUE Is The 500 lb Gorilla In The Room

2011-02-22T13:46:00.000-08:00

There it sits on the corner of West Fifth and North Pine, a majestic structure rising 51 floors. It dwarfs the Fifth & Poplar complex significantly, even though they share almost the same amount of units.

I remember when the developer first came to town in late 2004 and met with the board of The Friends of Fourth Ward and shared pictures and descriptions of the amenities and views that would be available, it was quite something. The early media splash garnered a lot of attention, then they opened their sales office on Trade and Tryon, can't get any better than that.

As sales started to take place, zoning issues arose, then funding issues, then site prep work issues, they were all resolved. Things looked great for this building, until the market fell apart! The developer had contracts in hand, enough to begin construction and went forward with the excavation. Slowly, it began to come out of the ground.

The finished product is pretty much as advertised. The amenities deck is marvelous, the views are stunning, and closings are taking place, just slower than the developer would like to see.

Loans have become issues for some as the appraisals are coming in below the contracted price. The biggest problem for appraisers is what do you compare it to? There is nothing like it, the TradeMark, and The Avenue are no where near the standards for The VUE. The problem with the loans is that the lenders are telling contract holders that they will need to put more money down to secure a loan. Something that many are uncomfortable with.

Some have tried to back out of their contracts, but the developer is holding them to the terms of the contract, which may include financial restitution above the initial deposit. Lawsuits (4) have been filed from both sides.

While that takes place, closings are continuing to occur. It seems like every day there are more lights on in the building. Residents that have moved in seem to be pleased with their purchase and the urban lifestyle that it brings.

My belief is that closings will continue, and new sales will be made. It will probably take significantly longer than the developer planned, but within a year we will see many more lights on in The VUE

Don't Look Now, But Things ARE Getting Better!

2011-02-16T08:13:00.000-08:00

A funny thing happened on the way to a showing of properties for a client I am working with yesterday, 2 of the 8 properties we were looking at had just gone under contract! The listing agents were in the process of taking competitive bids for those properties.

These properties have all been on the market for some time, and yet, they are now looked at as being of great value.

There are several things that contribute to this type of behaviour. First, the prices are very competitive in this market, and have either amenities or location that are desirable. Second, they are in good condition and show well, allowing a potential buyer to feel how that property will work for them. Third, interest rates are in the process of rising, a usual sign that the bottom has passed. And fourth, the banks are awarding their bonuses for 2010.

All of these trends bode well for the continued strong recovery of the market.

THEN We'll Be Cool!

2011-02-12T12:56:00.000-08:00

My wife and I used to play a little game called "And THEN we'll be cool!", the joke being that any one thing would be enough to make a game changing difference. Truth of the matter is that when things happen or change, it is usually due to a series of things.

I bring this up because of a recent meeting I was involved in with the Charlotte Region Visitors Association, (CRVA). We were talking about the successful effort to secure the Democratic National Convention in 2012. Tim Newman pointed out 5 main reasons that had a significant contribution to this success:

A Headquarters Hotel within 5 minutes of the Convention Center
A workforce flexible enough to handle ad hoc needs
Destination Activities
Urban Appeal
Convenient Infrastructure

No one of these reasons by itself would have been enough to convince the DNC that Charlotte was the right place, but having them all in addition to many other amenities, tipped the scale in our direction. An off-shoot of this convention is that the CRVA is now getting calls from convention planners who had always considered Charlotte to be unable to be a host city in the past.

Becasue of the nature of the convention business, the CRVA has an 8 year plan, and they are currently running 108% ahead of that plan. All this will translate into Tax Revenue for the county and city governments.

Another benefit of holding this convention will be the WorldWide attention that will be paid to our city. The cost of going out to purchase this type of exposure would be significantly greater and not have the same impact as this convention will.

Hats off to all that made this effort a success.

The Democrats Are Coming!

2011-02-07T05:40:00.000-08:00

It is not often that I get a chance to comment on breaking news, but here I go. The local media is flooding the airwaves and print with stories of how this will affect Charlotte, what the economic impact will be, what kind of security will be in force, etc. All important stuff, but what I want to discuss is how this will affect property values in the downtown area.

In my January 2011 Report, I mentioned the likelihood of the announcement comin

g in the 1st Quarter, and here it is. I also commented on other topics that would be in the news during 2011, including; The Knights Stadium; The Park; Two Ten Trade; The VUE; and Amtrak.

With 19 months separating us from the start of the convention, I believe the following things will happen. Knight Stadium and the accompanying Romaine Bearden Park will be started, and completed. That whole section of the Third Ward will be filled in to make room for outdoor events during the convention. Both the Park and the Stadium will have long lasting benefits for the city, but to have them available for the convention will be amazing.

Almost coupled with the Stadium and Park is the Amtrak Station and Greyhound Bus Terminal. With the renewed emphasis on HSR (High Speed Rail), a new station in the heart of the city will help punctuate the message that Obama delivered in his State of the Union speech. That terminal will also be home to the Commuter Rail project running up to Mooresville. And, having recently taken a Greyhound Bus trip, I can tell you that the bus terminal needs improvement/replacement. I would also expect to see the extension of the LYNX to the University area to be in full swing.

These three projects connect a swath from Trade and Graham to Tryon and Third Streets and they all represent infrastructure improvements.

It has already been announced that The Park will begin its reconstruction early this year. The new configuration of The Park will create over 100 hotel rooms in addition to over 80 condos. Its location between the convention center and the arena almost guarantees its success. I would also expect to see the Two Ten Trade site be reconfigured into a major hotel. Situated in the heart of the city and across from the arena, this site is begging to be completed. It will be a shame that the residential market will not be in a position to take it, but a hotel there makes sense.

The VUE will continue to have closings at a pace slower than the developer would like, but as the climate for residential changes, and little new inventory is added, this property will begin to take on new contracts.

The question is how will all this affect property values in the downtown market? I often speak of trends that are taking place in society. Northern cities will continue to shrink as infrastructure costs will force taxes to rise, making it difficult for both individuals as well as companies to remain there. That trickle will increase.

Efforts by the Chamber of Commerce supported by the banks and Duke will continue to encourage related companies to move here citing lower costs of doing business, progressive governments, mild weather, an airport with direct flights both nationally and internationally, close to the mountains and the beach.

So, as this inevitable growth takes place, and there are no, or few, new residential projects available, the laws of supply and demand will lead to higher property values, and that can't be any too soon!

Housing Trends - Mortgage Rate Increases

2011-02-07T05:36:00.000-08:00

December 2010 saw a sharp jump in the Distressed Property Index as reported by Campbell Surveys. The index was at 47.5% of all sales on a national level. These properties were not distributed equally around the country, with 66% of all transactions in California being distressed. Arizona and Nevada were next with 62%. My research into the downtown Charlotte market put our number at just under 35%, significantly smaller, but still a good share of the market.

Distress properties need to be sold off the market in order for a more traditional appreciation of property values to take place. I recognize the need for this to take place, and have partnered with USHUD.COM to represent foreclosure activity in the NW Mecklenburg County area. Please follow this LINK to see this.

Concerning mortgage interest rates, Freddie MAc says a 30 year Fixed-rate mortgage averaged 4.8% on Jan 28th , up from 4.7% the previous week. These rates are volatile, and will vary, but the trend line is up. That appears to be a clear sign that the bottom of the market has been hit, and a return to appreciation has begun though remains modest.

The availability of distressed property, plus still favorable but increasing interest rates, should continue to fuel the regrowth of the real estate market.

Downtown Property Valuation

2011-02-07T05:34:00.000-08:00

In the February 1 edition of the Charlotte Observer, there is a story about the county doing a revaluation of properties, the first one since 2003. The article goes on to explain that property is selling from 6 – 8% above tax valuation. This prompted me to focus specifically on downtown Charlotte for calendar year 2010.

The source of my data is through MLS. Certainly there were other sales not recorded in MLS, but these are the only stable statistics I can use. I have made 2 exceptions from the 142 properties that were reported as being sold, 5 sales in Metro 10 West showed no tax value, and the unit that Michael Jordan purchased in The Trust for over $3.4 million was also removed.

The remaining 136 properties sold for an average price of $246,232 for an average of 1145 sq ft, or $215 per square foot. The average tax value of those properties is $268,765. So, in the case of downtown Charlotte, properties sold at 8.4% below the tax value!

If you wish to have a copy of this spreadsheet, please eMail me and I will forward it to you. I have sorted it by complex in an effort to help define specific buildings.

Public Market And Farm To Fork Foods

2011-02-07T05:32:00.000-08:00

It was almost a year ago that Reid’s announced that they were closing Reid’s Fine Foods at Seventh Street Station. The building has been vacant since the middle of June. Charlotte Center City Partners announced an ambitious plan to create a “Public Market” based on the models of Pike’s Market in Seattle, and The West Side Market in Cleveland. Part of their announcement included a plan to ask the local governments to contribute $1 million dollars for the upfit.

Well, judging from the lack of enthusiastic support, that request was quickly pulled back. What has happened since is a number of workshops from local groups, both from the community as well as the farmers and craftspeople to try to gauge the likelihood of this actually happening. Private donors have been secured to fund the project without governmental help, and the plans are moving forward very fast. I would expect a major announcement before the end of March, and a targeted opening in early summer.

This bodes well for people like me who do food shopping every day. I by fresh, cook fresh and throw nothing away! I let the markets be my refrigerator. But more than just that, the ability to buy foods that are not processed offer a chance to better control my diet.

In view of that, Executive Chef Cassie Parsons is preparing to launch a local food program to make it more convenient for the people of Charlotte to obtain the same high quality products we serve at the Harvest Moon Grille as well as support our local farm economy. This online local store will feature Carolina raised proteins and produce, artisan cheeses, preserves, and many other wonderful items made right here in our community. More information will be forthcoming over the next several weeks, but it promises to add to our urban lifestyle.

Fear, Uncertainty, And Doubt!

2011-01-23T06:32:00.000-08:00

While news reports are a valuable source of information, they can often lead to making assumptions that are not accurate. Two examples come to mind. Last year as the economy began to show signs of making significant progress towards recovery, talk of a likely "double-dip" recession was reported everywhere. The effects of this is difficult to measure, but the undeniable result is that many companies delayed hiring, or capital spending in an attempt to defend against such a "double-dip".

The second example appeared in the Charlotte Observer on Sunday, 1/23/2011. The headline read "Over half of 2010 sales were troubled mortgages". The related documents do lead to a surface map that then shows the location and extent of the problems, but the initial impact of the headline can lead potential buyers to expect bigger price drops, and sellers to also make hasty decisions.

I have analysed the past 12 months sales activity for downtown Charlotte and have found that of the 147 sales recorded in MLS only 51 were classified as financially "distressed". That is just under 35%, and many of those can be related to contracts that closed during the peak of the market.

There is increased activity in this market, potential buyers are feeling more comfortable with the general direction of our economy. To be sure there are "financially distressed properties" available, and will likely be more, but the recovery process needs to have these properties addressed and sold, and faulty information can result in a longer time for that to take place.

How Should We Interpret Higher Gas Prices?

2011-01-21T06:41:00.000-08:00

I have always loved this parable:

"They say that if you put a frog into a pot of boiling water, it will leap out right away to escape the danger.

But, if you put a frog in a kettle that is filled with water that is cool and pleasant, and then you gradually heat the kettle until it starts boiling, the frog will not become aware of the threat until it is too late.

The frog's survival instincts are geared towards detecting sudden changes. This is a story that is used to illustrate how people might get themselves into terrible trouble.

This parable is often used to illustrate how humans have to be careful to watch slowly changing trends in the environment, not just the sudden changes. Its a warning to keep us paying attention not just to obvious threats but to more slowly developing ones."

What brings this to mind is the rising price of oil. It has passed $90 a barrel, and continues to rise. The continued rise in oil prices will make living farther from the city more problematic, both for one's own personal expense as well as a municipalities ability to sustain it with utilities and governmental services. The likely outcome of higher oil prices is to continue to develop infill lots.

The "frog" part of this story is that the gradual rise in gas prices will not have an immediate impact, but a slow deterioration of lifestyle until it is too late.

Many people who read my newsletter or this blog have already subscribed to the theory of living closer in, more densely packed. Some also subscribe to public transportation. The long term truth is that the entire auto society we live in has a termination point as it exists, it may be reached as oil is depleted, or it may be reached as oil becomes too expensive, but it is coming. Retooling our society for the next fuel source beyond oil will be a huge and extremely expensive task, one that I believe many will not want to do.

So, do we jump out of the water now, or wait until it is too late?

Charlotte's Street Car Future?

2011-01-20T17:38:00.000-08:00

The Charlotte Business Journal reported today that Kinkisharyo International has brought a Streetcar to downtown Charlotte for exhibition just north of the Seventh Street Station by the Ninth Street current terminus of the rail line. To be sure, this is but one potential winner for what will be the first in-street rail line for probably 40 years.

One of the most intriguing aspects of this particular design is that it runs off a rechargeable battery, allowing it to run without overhead lines. The aesthetics of this Streetcar running down Trade Street without the overhead wires has significant advantages

It is no secret that I am a big proponent of mass transit. I hope you can all take the time to see this Streetcar.

Beginnings Of North Tryon Rebirth?

2011-01-19T06:42:00.000-08:00

First it was Palomino's, then GW Fin's, now, here comes Delta's! The cavernous space located in the 525 North Tryon Street Building has been vacant for over 2 years. The most significant disadvantage to this location is that it is 5 blocks from Trade and Tryon, and is an island unto itself.

While Palomino's was a moderately priced restaurant, GW Fin's was more of a high end restaurant, and they provided live entertainment several nights a week. Fin's featured a New Orleans style cooking.

Delta's seems to be more in line with GW Fin's, focusing on Southern Style cooking, and an aggressive entertainment schedule. The targeted opening date is June 2011. Click here to see their website. Welcome to Charlotte!

Why Are People / Companies Moving Here

2011-01-12T05:39:00.000-08:00

Charlotte's growth, even during the Recession, continued to increase. Somewhere in the neighborhood of 3,000 people a month targeted the Charlotte Region as a place to live. January 10th, the largest accounting firm in the southeast was created when a firm from Winston-Salem, Dixon Hughes, and

a firm from Virginia Beach, Goodman & Company, merged and made Charlotte their corporate headquarters.

Opportunities for better jobs or better weather, present time excluded, are bringing people here. Better business conditions, or opportunities for growth are bringing companies here. The two feed off eachother.

Couple with that the increased cost of living in the north. Here is an article from Associated Press concerning Illinois raising their personal tax rate 66%! Wow!

http://www.chron.com/disp/story.mpl/ap/top/all/7377751.html

The infrastructure costs, and pension / health care costs continue to rise while the current revenue base continues to not be able to meet the committments. As companies look to control expenses, this tax will be a major consideration. As people look to control their expenses, this again will be a major consideration.

Illinois is just one example. Any and all of the northern states are in a position to do the same. Look out, here they come.

Renting vs Owning...Which Is Better?

2011-01-04T06:17:00.000-08:00

Franklin American Mortgage Company sends out a weekly newsletter. In this week's edition, I found the following information that points to the benefits of long range (5 years or more) ownership over renting.

"House price appreciation may not be what it used to be, but most participants in the National Association of Realtors’ annual profile of buyers and sellers still believe home ownership is a sound investment. Of the folks who purchased homes during the 12-month period ended in June, 85% said owning is a good financial investment. And of those, 47% said ownership was a better investment than owning stock, according to the survey, which was released at NAR’s annual convention in New Orleans. The results were similar, whether the buyers were first-timers or repeaters, or bought new or previously-owned houses. Ditto whether they were married or single, male or female. Sellers weren’t asked how they felt about their housing investments. But those who held their properties for five years or less didn’t do nearly as well as people who owned their places longer. Sellers who owned just two or three years were unable to realize any gain, while those who purchased in the 2004-2006 time frame took a profit of only $6,000, for a gain on only 3%. After that, sellers’ gains started piling up: $17,000 (11%) after six years, $35,000 (26%) after eight years, $49,000 (40%) after 11 years, $79,100 (78%) after 15 years and $108,300 (152%) after 20 years. But in an interesting anomaly, sellers who sold after 12 months or less bagged a $37,600 profit, or a 17% gain, probably because they had purchased a distressed property and substantially rehabbed it prior to putting it back on the market. Source: National Association of Realtors."

What To Look For In 2011

2011-01-02T08:40:00.000-08:00

As employment begins to increase and our growth starts to return to pre-recession levels, 2011 will bring about some significant issues/opportunities that will have an impact on our property values.

2012 Democratic National Convention. The decision as to the location of this event seems to be between Charlotte and St. Louis. The economic impact of a convention this size is substantial, but of even more importance to Charlotte will be the national attention focused on our city. Expect a decision early in the 1st Quarter.

Rhode Island School of Design. This is a topic that originally surfaced about 4 years ago. It was rumored that in part due to the success and growth of Johnson & Wales, RISD was looking to open a campus here. The likely site was located in the First Ward near the UNCC Downtown Classroom building and the LYNX Light Rail Line. The synergies for this Fine Arts College to be connected both with the downtown area, and the UNCC Campus via the impending rail extension are great. Great also will be the associated development this will bring along the North Tryon corridor.

Knight Stadium, Third Ward. This will need to be the year this is finally decided. Jerry Reese is almost out of appeals, he has not one any of his petitions. Construction costs are likely to be as low as they will ever be. The impact of this development will create the opportunity for upwards of 10,000 people to find their way to the stadium some 70 times a year. This will bring out merchants and restaurants to take advantage of that traffic flow.

Amtrak/Greyhound Stations. Stimulus funds will be used to do some track relocation near the ADM plant which will be the needed impetus for these stations to be built. The double impact of the Stadium and Stations will breathe life into an area that has been abandoned for the past 20 or so years.

The Park, Two Ten Trade, The VUE. All three of these developments were caught in the recession, only The VUE proceeded to completion so far. The Park is scheduled to finish its construction this year, only different from originally planned. It will now be a Hybrid of condo’s and hotel rooms. An interesting product, and one that is used in many cities. Two Ten Trade (Epicentre) is finally coming out of the courts, but I do not expect anything to substantially develop on this site for some time.

The VUE is entering a time of legal action. Some buyers are suing the developer

to get out of their contracts, and the developer is suing some buyers for non-performance on their contracts. I would expect the legal action to settle down by summer, and believe that by the end of the year there will be over 150 units (of the 408 in the building) to be occupied. All legal action aside, there will not be another building in the city like The VUE for the next 10 years. The size, the amenities, the location, and of course the views are all incredible. It is a shaky birth, but I believe it will survive.

To be sure, there will be other issues that will come up, but I expect that these will be the talk of the town!

Cities With The Biggest Drop In Housing Prices

2010-12-19T14:34:00.000-08:00

Cleveland, Minneapolis, Portland, Dallas, Phoenix, Chicago, Boston and Atlanta.

These are the "Big Eight", not really a distinction I would like Charlotte to have. When you look at these cities, it is a mixture of older cities with less desirable weather, or cities that experienced runaway appreciation which led to the housing crisis by a large degree.

As you look at the recovery and the number of businesses moving here, both of those reasons, weather and a stable economy, are major factors.

Will Rising Interest Rates Finally Push Buyers Back Into The Housing Market?

2010-12-19T08:10:00.000-08:00

Coupled with the article I entered here on December 13, Forbes is reporting that ironically, it could be rising interest rates that finally push home buyers off the fence and into the market.

While Congress debated the tax-cut compromise, the financial markets have interpreted the proposal as a development that will likely push mortgage interest rates higher than they have been for months.

Analysts are predicting that buyers will move quickly when it looks like rates are going up and are unlikely to come down. "Once people see this might actually be the bottom, they’ll go for it," says Paul Dales of Capital Economics.

The average rate for a 30-year fixed loan increased to 4.61 percent in the week ended Thursday, Dec. 9, from 4.46 percent the previous week. The average 15-year rate rose to 3.96 percent from 3.81 percent. Rates vary from lender to lender and are also predicated on other issues, so yours may be different from the above.

Have We Passed The Bottom Of The Market?

2010-12-13T06:59:00.000-08:00

Statistics are wonderful, they can be used to justify just about anything. Take this graph for instance. I have calculated the percentage of annual sales during the last third of each year for 2007 through December 12 2010. This gives us a look back at the high times of 2007 before the recession took it's toll.

As one would imagine, 2008 was a weak year, and only 15% of the annual sales happened during the last third of the year. In 2009, the year of the first time home buyer tax credit sales spiked to over 50% for that last third. The real interesting thing to note is that while 2010 is not yet over, and the first half of this year we had the extension of the tax credit, we have exceeded the number achieved in 2007!

To be sure, we still have a way to go, but when you are trying to find your way you look for signs, and this is a clear sign that the bottom has been hit.

One last thing to support this theory, interest rates are beginning to climb.

Today I Go To Mourn With A Friend

2010-12-09T06:16:00.000-08:00

This has nothing to do with Real Estate.

Lynn Weis is a friend of mine. His wife died on Saturday evening.

Death is always around, sometimes expected sometimes not. Mary Weis falls into that last category. She retired a few years ago and was enjoying her retirement. My thoughts and prayers are with her.

So, today I go to mourn with Lynn. I have known Lynn for 11 years and we have worked closely on many neighborhood initiaves. His presidency of Friends of Fourth Ward was instrumental in my becoming involved. Lynn is a great manager, politician, and friend.

I have not talked with Lynn since Mary's death. I am not sure what I will say to him today. Mary was such a large part of his life.

Retail In Downtown Charlotte

2010-12-07T10:37:00.000-08:00

When many of us think of retail, the thoughts of Miracle on 34th Street is brought to mind, with Macy's and Gimble's huge multi-floor department stores battling each other. Those days are gone for Charlotte. In the past, our versions were Ivey's and Belk's along with others.

During the urban renewal years, many old buildings, both storefronts as well as commercial buildings were torn down in the name of progress. Merchants also changed their models to have preprogrammed stores to plop into a suburban mall full of ample parking. Today's environment has also built parking garages to surround suburban malls.

As I identify trends currently taking place that will affect our property values, I am finding that there is indeed retail in downtown Charlotte, sometimes in plain view, we just don't notice it. The old Ivey's Department Store building, now Ivey's Townhomes, is a living example of thriving retail. Many of us walk by Ivey's everyday without realizing that the second floor has an expanded retail presents (see insert).

Sure. We see the fast food restaurants, along with the secured entrance for the townhomes, but who knew that there was a "Dollar Store" doing a great business on things we all use everyday?

Everything from a barber shop to a chiropractor, and all the spaces are filled.

If you haven't shopped there, stop in when you walk buy. While you won't be walking out with a major department store bag, you will probably have your hands full. Give it a try.

Housings Future

2010-11-30T05:58:00.000-08:00

I am copying an article I received from Franklin American Mortgage Company that puts some definition around reasons I believe the market is coming back. Particularly, while some indicate that current conditions will direct more people to rent vs own, the statistics continue to support ownership.

"The average homeowner has a net worth that is about 41 times greater than that of a renter, according to a report from the National Association of Realtors. Homeowners’ net worth averaged between $150,000 and $200,000 this year, according to NAR. The trade group for Realtors said homeowner equity accounts for a substantial part of that net worth. NAR based its research on results from a 2007 Federal Reserve Survey that provides a snapshot of family income and net worth in conjunction with basic demographic makeup. The Fed survey is conducted once every three years. A 2010 survey has not yet been released. Homeowner net worth back in 2007 was 46 times greater than that of renters, reflecting the economic conditions before housing price declines and a decreasing equities market. The average net worth of a homeowner was above $200,000, while the average net worth of a renter in 2007 was $5,000. Source: HousingWire

Total housing sales in 2010 will be down about 8 percent from last year, and will mark the bottom of the downturn, says a monthly report from Fannie Mae economists. The economic outlook from Fannie Mae is fairly upbeat looking ahead. Foreclosures will keep housing sales subdued in the final quarter of this year, the report says, but sales will see gradual improvement in 2011. “We expect home sales to increase by about 3 percent in 2011, says Fannie Mae (OTC BB: FNMA) chief economist Doug Duncan. “However the pace of the recovery will be largely determined by labor conditions. If hiring improves at a faster pace than expected, home sales will likely see a stronger gain in 2011 and vice-versa.” Improving financial conditions and recent encouraging signs from the labor market should set the stage for an above-par growth trend by mid 2011, the report says. Source: Washington Business Journal

A tougher economy is changing the way people regard housing design. Here are some of the new realities:

• The ideal home size is less than 2,000 square feet, according to Trulia.com.

• Formal living rooms and dining rooms are out; flexible space that can double or triple as home offices,

guest rooms or dens is most appealing.

• Porches are back.

• Energy efficiency trumps everything, with a private wind turbine in the back yard a real winner.

Source: USA Today"

Fifth & Poplar

2010-11-18T08:19:00.000-08:00

There is a new listing at Fifth & Poplar that I find quite incredible. It is on the 7th floor and is a large 2 br 2 ba unit. It is a Short Sale, and the price is $224,000. I showed it this morning and was very impressed at the size and finishes that it affords.

I have mentioned before the great values that are available in this building. To be sure, the tax value of the property remains high, and the HOA dues are high, and there is a monthly assessment surcharge of around $100 as well.

Despite that, this building is one of the best values in the city. The amenities, including an interior park of about 1 acre, a swimming pool, a fitness center, a cyber lounge fully equiped, indoor and outdoor fireplace, a patio deck above the Harris Teeter, and of course, it sits on top of a grocery store. Include with that a 24 hr a day concierge, and a location 2 blocks from the center of town.

Wow!

More On The VUE

2010-11-16T06:28:00.000-08:00

The VUE remains the biggest topic in this marketplace. Standing 51 stories tall, and looking front on to the Charlotte skyline it can hardly be missed. But the size is only one of the reasons it is a Big Topic here.

Born in the heady real estate days of the mid 2000’s, it promised to deliver a location, style, and ambiance that would be unsurpassed. Several other towers that were planned or in the works have either never developed (One Charlotte) or have disappeared due to legal and zoning battles (210 Trade Street).

The sale center for The VUE was prominently located at the center of town, on the corner of Trade and Tryon.

Back in the mid 2000’s per square foot pricing downtown was comfortably over $300, and in the case of Fifth and Poplar, The VUE’s next door neighbor, the prices were well over $350. A natural progression of value would have pushed the pricing levels to somewhere between $450—$500. Initially, all sales were handled internally by the developer. Several times during the sale cycle, changes were made to the staff. Some of the contracts that were written were done directly by that team, with the team acting as a Dual Agent, meaning representing both sides of the transaction.

Those of you who have purchased new from a developer will recall that the contract you signed was written specifically to cover the developer in almost every instance, only the 7 day right of rescission remained.

The VUE is complete now, just work on interior finishes or build out’s. Closings began in September, and of this writing, two units have closed.

Contract holders have received notices to set their closing, and they are finding that the appraised value of the property, that is the number that a lender gauges the amount of a loan they are willing to give, is coming in anywhere between 15% to 35% below the contract price. Faced with not being able to secure a loan for the balance of their purchase price, they will need to bring additional dollars to the closing.

The developer is sticking with the contracts in hand and can sue for non performance if the buyers do not close. Courts have upheld contracts when a buyer has the means to close.

There are no mulligan's in real estate. When you make a purchase make sure you have proper representation going in.

Foreclosure Myths Explained

2010-11-16T06:20:00.000-08:00

Go to this article to read about common myths regarding Foreclosures. It is important also to note that foreclosure is a process, and not a tangible thing. This means that when you see the word "Foreclosure" it is referring to the process.

Today's market is providing plenty of opportunities to purchase at significantly below the market value. It is unfortunate, but it is the market we are in.

Ahead Of My TIme?

2010-11-04T07:15:00.000-07:00

The article I have linked here discusses the potential beginnings of a trend away from car ownership. The article talks of many reasons for not owning a car, but the best reason can be found in the last paragraph. It appears these generation "Y"'s are realizing that they can best allocate the assets they have in other directions.

Way Cool Transit Information

2010-10-19T12:13:00.000-07:00

Go here:

http://toddata.cnt.org/

Register (it is free) at this site and you will have the ability to get an incredible amount of information on existing and proposed transit stations in terms of population and median income. How do they know this stuff???

Here in Charlotte, you can select the station (example: Seventh Street Station), and find out how many residents or jobs are within .5 miles, or .25 miles. So you can compare which stations are most TOD friendly with real numbers. You can also do this for future lines in Charlotte.

Could The VUE Consider This?

2010-10-18T06:18:00.000-07:00

Before I get into this, please note that this is just pure speculation. I have not talked to any potential owners, and I have not talked to the developer or the sales team for The VUE.

That said, please go to this article: Equity Sharing It might be a vehicle that would allow someone to close on this property without the developer having to make pricing adjustments from the contract price to meet the current appraisal value.

In this situation, again this is just unsupported conjecture, a unit which went under contract for $1,000,000 with a $150,000 down payment might only appraise for $800,000. A lender would in most cases only provide financing for $640,000, leaving a shortfall of $210,000. The developer might choose to do an Equity Sharing agreement, taking that $210,000 as part ownership in the property.

If as the developer says, the property will increase in value as we climb out of this recession, the developer may stand to make more long term profits on the property, if not, the developer will stand to recoup the investment upon the sale of the property.

Sale prices will be maintained for appraisal value, and mortgages will be able to be obtained.

Not a perfect situation, but food for thought on a sunny October morning.

Freezing Foreclosure Action?

2010-10-14T05:24:00.000-07:00

1. What is robo-signing and what all the fuss is about? The phrase robo-signing refers to what we’re now realizing has been a very common practice in the banks’ foreclosure document processing divisions, where one person was essentially given the job of signing as many 10,000 foreclosure documents per month, by hand. These individuals were supposed to be reviewing the files, making sure grounds for foreclosure actually existed, signing the docs in front of notaries. But because of the volume of documents, what they actually did was just sign thousands of documents at a time, without even reading them, and ship them off somewhere else to be notarized.

If you do the math on an 8 hour workday, you'll see that that only gives the staffer 1.5 minute to review each file and documents to make sure the foreclosure is warranted. That's not humanly possible, which is how these staffers got the nickname “robo-signers”

Government regulators are very concerned that the banks may have been taking people's homes without following the proper legal procedures. As a result, 40 states' attorneys general are teaming up to launch a multi-state investigation, and the federal Comptroller of the Currency and federal attorney general may also get involved in investigating this issue.

2. Will the freeze will make the banks cancel buyer contracts on REO properties? Currently, the freeze impacts bank-owned properties that are owned and/or serviced by Ally Financial/GMAC Mortgage, JP Morgan Chase, and some properties that were owned by Bank of America. Generally, contracts to buy these homes are being put on hold and extended for 30 days. As well, the banks are often reaching out directly to buyers and offering them the option to cancel their contracts and recoup their deposit money.

3. Is it safe to buy a foreclosed home? There's lots of talk right now about the "clouds" that this scandal will create on the titles to homes that were foreclosed by the banks' foreclosure mills. And that makes sense: if the home wasn't properly foreclosed on in the first place, then the legitimacy of the bank's resale can be called into question. Normally, don't worry about it, buyer - that's why you'll get title insurance! But last week, 3 of America's largest title company insurers declared that they will not offer title insurance on a number of the homes that may have been involved in this scandal.

In the vast majority of cases – when the foreclosure was justified and a bona fide purchaser, someone who was not involved in the bank’s wrongdoing, has purchased the home, courts will not reverse these foreclosures or their sale to buyers. But if you’re in the market for a foreclosure, get clear on which bank owns the place as soon as you can, and run the property past your title insurer before you get too far into the transaction to make sure they can write a policy of title insurance on the property before you spend too much money on inspections and appraisals.

4. How the foreclosure freeze will impact American home values, say after you buy. In the short term, these freezes might cause prices to stabilize, as we expect to see the supply of foreclosures for sale start to shrink. However, if these freezes stretch out for a long period of time, they could simply be delaying many inevitable foreclosures, which could delay the recovery of the housing market and home prices, over time.

Fifth & Poplar Moves Distressed Properties

2010-10-09T19:16:00.000-07:00

Fifth & Poplar located in the Fourth Ward has always been a wonderful location. The interior park is peaceful, and well maintained. An apartment conversion project, it sold out during the peak of the market back in 2005 - 2006. It was not uncommon to see square foot prices as high as $385!

Back then, lenders were both lending, and being creative with the types of loans available. Balloon mortgages were frequently the mortgage of choice, and many others got a mortgage and a second mortgage basically putting nothing down.

The beauty of this property was that it was chocked full of amenities, everything from a great pool, to a doggie park, to a concierge, etc. These things all cost money, and the HOA dues, based on square footage, was in the upper $300 range.

Due to maintanence issues and needing to develop a legal fund to potentially pay for legal action against the builder, the HOA fees have been increased by around $110 per unit per month! Yikes.

The recession cost many their jobs, or lead to transfers out of the city. As the market went down, the balloon payments became due, further strapping the abilty of some owners to meet their obligations. Foreclosure activity and Short Sales began to be the norm.

I have shown the building many times, and there are significant deals and values to be had there. The good news is that it is beginning to work. Since July 1, five (5) properties have sold, and another six (6) have gone under contract. The average selling price is under $200,000, and the average $ per square foot is at $200!

There are still properties available, and I would love to help you to secure one if you are motivated. Call me.

Interesting Times At The VUE

2010-10-08T12:09:00.000-07:00

There have been some rumors going around that some of the people who have contracts to purchase at The VUE were considering walking away from their investment. There is a blog VueCharlotteBuyersBlog that has reported much of this, and describes the difficult wavering that some are experiencing.

There was a post on that blog from the developer MCL which links to a court order on a different property ruling in favor of the developer and instructing the buyer to go through with the purchase of the unit they contracted for.

Court Order

Stay tuned, more to come!