Overview of Charlotte Housing Market

July 26, 2008

Lynnsy Logue The Real Estate Lady and Condo CanDo, Charlotte, NC

Just returning from a quick trip to my home places, I gathered up the newspapers to catch up on our Charlotte Real Estate market. Of course, there are many opinions and new sets of figures from each source. The ones that more closely resemble my own are from Karla Hammer Knotts. She writes:No reason for fear about Charlotte housing market
No housing ‘bubble' here, just normal market ups and downs.

Karla Hammer Knotts
From Karla Hammer Knotts, owner of Land Matters, a real estate consulting company:
If you're waiting for home prices in Charlotte to fall significantly before purchasing a home, be careful. You may have been misled – or “Case-Shillered” – by a notoriously negative barometer of the national housing market.
Released at the end of each month, the Case-Shiller Index measures home prices in 20 U.S. cities. It's the media's report of choice on the housing market. Robert Shiller, creator of the index, claims home prices “will fall further than the 30 percent drop in the historic depression of 1930s.”
Why such alarming predictions? Seven of the 20 markets analyzed in Case-Shiller are from hard hit-areas in the West and Florida, places such as Las Vegas (prices down 25.9 percent), Miami (down 24.6 percent), Phoenix (down 23 percent) and Los Angeles (down 21.7 percent). This skews the index and leads to headline-grabbing proclamations that may result in a false fear that prices in Charlotte have a long way to fall before bottoming out.
For an example of a disconnect between the index and reality in Charlotte, look at May's Case-Shiller report and subsequent media coverage which concluded “home prices fall 14.1 percent.” At the same time, home prices in Charlotte, the only N.C. city measured by the index, actually rose.
So what's really happening in Charlotte? On June 18, the Observer declared “Housing slump slams Mecklenburg builders.” Building permits are down to lows not seen in years, the article tells us. This is true. While some view these numbers as further proof of impending doom, savvy observers understand these are signs of recovery and opportunity.
Charlotte is in the middle of a normal real estate cycle. We hit our peak at the end of 2006 and will quickly reach a bottom. Why? Charlotte's strong fundamentals (that is, no bubble) delayed the slowdown, allowing builders to anticipate the downturn and cut new starts and inventory quickly. Evidence of this foresight is clear in the latest building permit data: It shows a sharp, but expected, decline.
Our market had excess permits in 2006 and 2007. Those houses have now sold and permits are balancing with demand. This is good news for homeowners. For prices to stabilize and rebound, builders must eliminate inventory of finished homes. To opportunistic homebuyers, this is a signal that now is the time to buy.

Lynnsy Logue The Real Estate Lady and Condo CanDo, Charlotte, NC

The Power of One...

July 24, 2008
Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte.com
The Power of One…
From global to local…we live by the numbers these days. Interest rates, the numbers of foreclosures, the price of oil per barrel, the cost of gas per gallon, the number of building cranes uptown, the number of condo towers stopped, stalled and in litigation. Then the more human side: the number of jobs lost, the number of employees to be laid off, the number of plants closing, the number of top executives leaving the building, the amounts they have been paid, are being paid and benefits they collect. The numbers in our own checkbook, the months we can stay in the water.And what it boils down to, for me at least, is today. I am heading off to a farm in Virginia. It is an historic farm and has been in the family for generations. Not my blood family, my family by close bond, shared laughter, decades of history…and yes, numbers.Of the twelve children born on that farm in Virginia, one is 82, my 8th grade school teacher, another is 83, also a school teacher who lives in another part of the farm with her family, and another sister 85 who tends the herd of cattle, has a beer now and then and wears a baseball cap. Many others will join us as we head out to their lake house to cook breakfast tomorrow morning…a celebration of birthdays, mine at 69 and those other Leo’s mentioned before.I throw some things in my van and take out the signs and info boxes…data sheets and water bottles from my journey around Charlotte this week. Yes, some projects are stalled, some seem stalled, some though are finishing up and look terrific, some of the towers uptown have reported sales. There is buzz about the numbers of large apartments that can’t be found. . The news of how much the market is down. What I focus on is what is being sold in the market, the activity I see in the mortgage offices, the news I hear and read about new companies coming to Charlotte or the region. What I delight in is how people are adapting, how folks are being creative, how many help each other by sharing a ride, and grocery pick ups. What really touches my heart is the vast number of conversations about how we will get through this, the numerous discussions about how we can do something about the economy, the dozens and dozes of thoughts, ideas and articles about how we can approach global warming. It is about the power of One.

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte.com

Charlotte Uptown Condo Tower Report-July 2008

July 24, 2008
Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte,NC
Regarding Charlotte’s Uptown Condo Status:

Is Wachovia going ahead with its First Street Cultural Campus which includes a new headquarters and a planned condo tower?
Tom Wurtz, Wachovia's chief financial officer, said to expect “continued progress on all fronts.”
“No change in schedule for the office tower,” he said. As for the planned condo, he said it is “of great interest to us.” However, Wachovia might pursue that project with a partner.
Uptown's condo market has struggled in the downturn, with two towers postponed, one in foreclosure and another stalled by a legal dispute. David Furman, one of Charlotte's early high-profile condo developers, said Wachovia has a year or more to consider its next steps because the condo would sit atop a museum still under construction. “It's not worth worrying about today,” Furman said.

And on another tower, from hotel-condo to hotel:

This is a rendering of the 16-story Hotel Sierra planned beside Time Warner Cable Arena.
A sliver of land beside Time Warner Cable arena that didn't work for a large condo-hotel development is getting a 16-story hotel without the condos.
LodgeWorks of Wichita, Kan., plans to start construction this summer of a 163-suite Hotel Sierra on a third of an acre on the Caldwell Street side of the Charlotte Bobcats home court.
Denny Meikelham, senior vice president of development, said LodgeWorks originally cooperated with Charlotte developer David Furman and his partner on a project that would have combined condos and hotel rooms in a 25-story tower.
When the plan fell through last year due to site restrictions and construction costs, LodgeWorks decided to buy the land from the city and proceed on its own.
“There is so much opportunity in this area, and it's close to everything,” Meikelham said. “This is a forever location. It's only going to get better with the NASCAR Hall of Fame and what's going to happen around it.”
He expects construction of the $35 million project to take about 14 months, which would put the opening in late 2009.

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte,NC

Yes, There Are Condo Buyers in Uptown Charlotte

Jul. 23, 2008

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Fall could be a catalyst for new condo's success so w rites Doug Smith of The Charlotte Observer

The Catalyst has already sold 58 of its 462 units. And the developer is pleased.
A rendering of the Catalyst condo tower under construction on South Church Street.
The Uptown condo market has suffered setbacks over the past few months, but that apparently isn't scaring buyers away.
The Catalyst, a 27-story tower under construction on South Church Street, has sold 58 one- and two-bedroom units during its first three weeks on the market.
It does have a ways to go – the project includes 462 residences priced from the $180,000s to more than $300,000 – but given the season and the economic climate, Atlanta developer Novare Group is pleased.
“Fall is always a good time in uptown Charlotte,” said Wendy Field, who leads the sales and marketing team. “If we are doing this well now, we feel good about where we will be then.”
Condo developers are selling in the face of some of the worst news the uptown housing market has seen since the center city high-rise boom began about four years ago. Two towers are postponed, one is in foreclosure and another is stalled by a legal dispute.
Developers are reluctant to try new high-rise projects, as lenders aren't interested in financing them until the economy improves.
Yet “inventory is line with a healthy market,” said multifamily analyst Emma Littlejohn of the Littlejohn Group. “The problem is with delivery.”
Littlejohn said about 1,200 high-rise and mid-rise units are under construction or in the pre-sale stage in the center city, and more than half of those are under contract for sale.
The central Charlotte area that includes uptown is performing better on sales and resales than the overall residential market, she said.
With four major projects now in doubt, Littlejohn said, a bigger issue for the center city could be a potential undersupply of high-rise condos.
She wasn't surprised to see an initial surge in demand at Catalyst. “People are out there on the sidelines,” she said. “They still need a place to live.”
Field said buyers today are less impulsive and more likely to secure financing before making an offer.
Catalyst, unlike most condo projects, was started without a pre-sales campaign and is expected to open early next year.
“It gives people more confidence to know they don't have to wait two years,” Field said.
Novare targets 25- to 40-year-old buyers with a predominance of one-bedroom units and amenities packages that include a fitness center, a club room, a pool, an Internet cafe and concierge service. About 65 percent of Catalyst's condos are one bedroom.
A good mix of one- and two-bedroom units have sold, Field said, with the project being typical for a high-rise: “The most expensive and least expensive tend to sell right away.”
Catalyst (catalystcharlotte.com) will overlook a planned uptown park, and that was a lure for many of the initial buyers, Field said.
Also a factor: gas prices. “Many of the people who come in are asking where the light-rail stop is in relation to the project,” she said.

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Point, Counter Point, Rezoning for Towers

July 22, 2008
Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Council OKs tower on South Boulevard
No opposition voiced; controversy over views
By Clay Barbour

Developers are planning a 230-foot apartment tower, a 200-plus foot office tower and a 180-foot hotel on approximately 2.74 acres next to The Arlington (in background).
The Charlotte City Council Monday approved a rezoning bid for another high-rise tower along South Boulevard.
The approval came in spite of the recent controversy over the proposal. Residents of the nearby Arlington tower had complained that the new 230-foot-tall building would block their views of uptown.
But on Monday no one spoke against the proposal and the council passed it unanimously.
“We are excited and a little surprised,” said Tracy Finch of the Harris Development Group. “We expected more opposition.”
Harris applied for a rezoning of the former Simpson's Lighting property. The apartment tower is part of a $200 million project that includes a 200-plus-foot-tall office building and 180-foot-tall hotel on approximately 2.74 acres.
The Charlotte-Mecklenburg Zoning Committee unanimously backed the $200 million project last month, with some changes. Center City Partners also supported the plan.
But earlier this month some residents of The Arlington, South End's 300-foot-tall pink residential high-rise, complained that the new project would block their views and lower property values. They said they have a right to their views in the non-legally binding South End Transit Station Area Plan approved in 2005 – about two years after The Arlington opened. That plan caps building height in the area at 120 feet.
Hundreds of thousands of dollars sometimes separate condos with views of the city from those without. At The Arlington, available condos facing away from the city are larger and cost around $335 per square foot. Available uptown-facing units top out around $372 per square foot.
Finch, who spent the early part of Monday going back and forth between council members, said the idea that Harris' new project would hurt Arlington's property values is not accurate.
“They will go up than The Arlington isn't without its own controversy. Some residents of the Factory South Lofts complained about their view being blocked when the tower was built.Thanks to us,” she said.
And Counter Point:
South End tower wins swift OK
Reporting live, from City Council: Mary Newsom of The Charlotte ObserverThe City Council launched the vote-on-rezonings part of its meeting at roughly 6:25 p.m. By 6:39 p.m. it had finished its rezoning decisions. They ripped through 18 rezonings, all except one of them approved unanimously with no discussion on any, except for about 30 seconds on the one that was approved 7-2 for a day care center at The Plaza and Barrington Drive).That proposal to allow a 250-foot high-rise tower in South End? The one that was in violation of the South End Transit Station Area Plan, which set a 120-foot height maximum? I didn't have a stopwatch, so I couldn't tell you whether it was 5 seconds or 10, but there was no discussion, nothing. Unanimous approval, and on to the next agenda item.Sure, the council's rezoning meetings can drag. The public hearing part of the meeting tends to bring out developers and neighborhood opponents. It's 7:34 p.m. and they're just on No. 6 in a 15-item public hearing agenda. And council member Michael Barnes just pointed out that there have been numerous violations of the Northeast District Plan in recent years. So why didn't he -- or anyone else -- think it was worth maybe a little public discussion about why they were violating the South End station area plan, adopted in 2005?Maybe there were good reasons. Maybe the 120-foot maximum height limit adopted as part of the Transit Station Area Principles isn't a good idea after all. You, the voting public, have no way to know why the council members decided to treat their own adopted plans as virtually irrelevant.They're on auto-pilot. The biggest issue facing the city for decades has been growth and how to deal with it and pay for its impacts. You'd like to think your elected officials are thoughtfully debating the pros and cons of different growth proposals. Guess what. I'm watching them tonight, and it's pretty hard not to conclude they've abdicated that responsibility.

We see more and more of these decisions...and question their wisdom for the long term.

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Here Come The Americans!

July 21, 2008
Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC

Here come the Americans…
I believe in the spirit of this country and have read so much about all the sub-prime mess…looking for the rays of hope. What I seek is the pathways that led us here and then the ideas and the pathways, even though we may have to blaze them, out and to better ideas of what we can and might do.Applause to Neal Peirce of the Washington Post Writers Group for his ideas.
I am selecting his very good ideas for path out of and not the path into this mess.
He first calls for Assistance for low-income renters through the national affordable housing trust fund… and then the restoration of HUD.
He writes: With a will, we could have top-notch leadership and a rejuvenated agency staff focused on a full spectrum of housing for all Americans. Though maybe with a caveat-to rename HUD the Department of Housing and Metropolitan Development. Why? To think more expansively, to make connections. No Other developed country lacks a national policy on cities, recognizing the vital importance of urban regions. We need such a policy-and department.He continues: Build in anti-sprawl incentives. Incentives for coordinated development could be built not just into housing but also highway or transit bills, requiring our nationwide set of metropolitan planning organizations to take on land use, working with city and suburban governments to limit wasteful outward sprawl of regions.But a HUD focused especially on cities and housing could be a special steward of the new relationships, providing incentives for core cities and suburbs which increasingly need housing supports, to work together.Plus a new HUD could watch to see that housing has meaningful income mixes and that it works hand-in-glove with transportation-making sure, for example, that when federal housing dollars are used, there will be upgraded zoning around highway interchanges or transit stops, providing higher density, more energy efficient and socially inclusive housing together with job-providing commercial development. That way, isolated housing projects for the poor and federally financed roads to developers Greenfield projects would be history.We could do all these exciting things. But first, we’ll have to make some smart choices-candidates with vision, and some tough political hides-in the November elections.
We have problems. We have solutions. Here come the Americans!

Lynnsy Logue The Real Estate Lady and Condo CanDo in Charlotte, NC