This article from today’s News & Observer takes the temperature of downtown Raleigh’s current condo market, essentially making the case that while it’s still frosty, it’s at least no longer arctic. The story counts the remaining units left to be sold in the four most-recent downtown developments and provides this chilly forecast:
Based on the recent pace of condo sales, it’s conceivable that the remaining new units will be sold by summertime. After that, the only option for people seeking a downtown condo will be to purchase one that’s been previously occupied.
And that is likely to remain the case for years to come. Given recent history, and the fact that banks now flinch at the mere mention of the word “condo,” it is highly unlikely that any new projects will be built in the downtown area for at least another five years.
In sunnier news, the multi-family rental market should remain hot now that the Raleigh City Council has approved a 250-unit mixed-use project on Oberlin Road. For more on the state of Raleigh’s multi-family rental market, see my October 23, 2011 blog post here.
November 4, 2011 Update: Raleigh’s multi-family construction boom appears to be part of a national trend. According to Mark Obrinsky, Chief Economist for the National Multi Housing Council (“NMHC”), strong demand for rental housing is driving increased multi-family activity in most markets: “Powerful demographic trends along with changing attitudes about homeownership and tighter mortgage underwriting continue to drive a shift toward renting, which is fueling a ramp up in new construction.” The NMHC’s October 27, 2011 news release can be found here.
November 6, 2011 Update: More evidence of the multi-family construction boom can be found here, from the Charlotte Observer’s “Development” blogger, Kerry Singe. The “Coming Rental House Wave” report mentioned in Ms. Singe’s blog post can be found here.