Thursday, December 11, 2008

Answer to condo/loft glut: lease 'em, don't buy 'em

Here's an article in today's LAT that says many of the recently rehabbed condo/loft building developers are now leasing their units because they have been unable to sell them in the current market. You don't say. The article says it is happening in downtown L.A. and to a lesser extent, Hollywood and the SFV. Wow. What a surprise. I have been wondering for a long time when this trend was going to end -- this is not a city like NY or San Fran where mixed-use happened because there was no other kind of use -- people have tended to live where they worked in those cities because, well, for many decades there was no other viable place to live or way to get to other housing. They didn't move downtown from the suburbs because for many decades, there were no suburbs. Our current move-into-an-urban-area-from-the-burbs trend is the reverse of what has occurred in the past.

While I think urban living is a fabulous idea for many, I also think the market for buyers has been more limited here due to there being no schools and few essential services (grocery stores) available anywhere close to the condo/loft communities.

And this trend also tells me that developers, inspite of whatever research they may do, are as susceptible to fads as anybody else.

But hey, if I was 25 and had lots of money, I bet a downtown loft would be a really cool place to live!

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