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Rebecca, Other/Just Looking in Reading, MA

Are condos overpriced right now?

Asked by Rebecca, Reading, MA Wed Feb 25, 2009

I'm interested in buying a place in Woburn or Burlington, but I want to choose a property that I can sell again fairly quickly if I have to relocate for my job. I like condos a lot, but I'm having a hard time believing that they will be able to keep their approx. $300/sq ft value over the next couple of years. The houses seem like a much better value to me.

Are the condos in this area overpriced? They seem that way.

Thanks.

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6
Rebecca, I am a Woburn agent and as a former engineer (in my past life), I put a lot of effort into understanding the trends of the local market. Condos continue to drop in price, and the sales (units sold) are down as well. I have a very telling graph of the last 12+ years of pricing history in the local area, that I could send you if you'd like. One of the problems these days is the financing. Condos have really tightened up and result is that sellers can't sell, and buyers, who might be qualified, can't get a loan on the specific condo. I just had one occur where my buyer was pre-approved, actually got a commitment and the unit was rejected because FHA wouldn't spot approve the condo complex. If you were to find a great buy today, I think you need to plan on owning for a while, perhaps even renting it out, when you need to move on.
1 vote Thank Flag Link Thu Apr 2, 2009
Hi Rebecca
You might need to sell again fairly quickly?? I am not sure what : "fairly quickly" translates to, but if it is within a year or two, I wouldn't buy right now. I certainly don''t pretend to know your area, but, for the most part, this is not the market for a short term purchase.

In regard to a condo versus a house - in my area the condo market has been harder hit than homes - with a higer percentage of depreciation. .We have lost a lot of the move-up empty nesters that would normally be trading down to smaller spaces. They are staying put. The condo market here is mostly populated with first timer buyers now, so there are fewer buyers out there for that type of property. In my area, there is also an over abundance of condo complexes, so the competition for buyers is fierce.
As I said, this is based on my area .

Good luck to you in whatever you decide.
Debbie
0 votes Thank Flag Link Wed Apr 1, 2009
Rebecca,

Call a Realtor to do a CMA for you in the area you are looking. If you are renting you are adding to someone elses personal wealth. Pay yourself first!
0 votes Thank Flag Link Wed Feb 25, 2009
Presently there are a number of considerable values out there for condos, I am looking at one myself but it would be for recreation and investment and this is the issue at hand - financing. Many condo complexes have a number of condos in financial trouble, just by simple numbers of the number of units in a complex - say 410, just one percent having financial difficulty is 4 units......so the banks see this as an issue and they also look at owner occupancy and in this market it is a great time to purchase an investment property (should one have the finances to go forth) so the ratios on owner occupancy may take a hit there too, banks and lenders feel it is much easier to walk away from a second residence or investment property instead of a primary residence. the condo market had great gains in appreciation during the past housing boom and have now leveled off making it a great time to buy. Condos appeal to a certain kind of buyer and single family homes to another certain kind of buyers, will these buyers always be out there, most likely, will there always be a demand to make a condo a liquid asset for a quick turnover...no one has that fortune telling ball, should you come across one, you would not have to worry about selling a condo quickly, you could own the world......remember with risk there is reward! Good Luck! If a first time homebuyer keep in mind the possible $8000credit too!
If i may be of assistance, Marybeth Muldowney, Broker Owner TradeWinds Realty Group LLC
http://www.WeGoOverboardForYou.com or cellular 781-910-7294
Web Reference: http://8000credit.com
0 votes Thank Flag Link Wed Feb 25, 2009
Rebecca, this is a tricky question. In Woburn, it appears that on average, condos are selling around $200 per sq ft, and in Burlington, looking at the recent sales, the costs are around $300 per sq ft. The reason for this could be twofold. Burlington has a higher average sale price than Woburn, which indicates a perceived value that buyers might have. Secondly, the condos selling in Burlington may be newer units with more of the bells and whistles that might be missing in some of the older, condo conversions in Woburn. There is no question that the condo market has fallen in a bigger way than the single family home market as along with lower prices, the volume has decreased as well. I have a chart that I'd be happy to share with you if you'd be interested, showing condo sales and price trends in the local area. Let me know.
0 votes Thank Flag Link Wed Feb 25, 2009
Hi Rebecca,
Condo's are a tough sell right now because of the decline in single family prices, but that doesn't mean the right deal is not there for you. Buying and selling anything on a short term plan could be risky in this market. You should sit down with a Buyer's agent and go over your needs and overall goals. You can use the current MLS data to help you decide the right type of property for you. Once you have a better idea of what you are looking for, you can start searching for the best buy/resale property for your budget. If I can be of any help, don't hesitate to contact me. Best of luck.
0 votes Thank Flag Link Wed Feb 25, 2009
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