tag:blogger.com,1999:blog-6208142538381626414.post3137253188758810990..comments2023-06-02T09:11:54.767-04:00Comments on Columbia Talk: The $440,000 CondoColumbia Talkhttp://www.blogger.com/profile/15837022564514347836noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-6208142538381626414.post-40043709906548365102009-11-06T19:06:37.874-05:002009-11-06T19:06:37.874-05:00don't you just love, @hecker? i do. so smart, ...don't you just love, @hecker? i do. so smart, sane and reasonable. ;-)jessiexhttp://www.twitter.com/jessiexnoreply@blogger.comtag:blogger.com,1999:blog-6208142538381626414.post-71103229989117387292009-11-05T16:50:15.014-05:002009-11-05T16:50:15.014-05:00I haven't read the "Downtown Columbia Fis...I haven't read the "Downtown Columbia Fiscal Impact Analysis" document thoroughly, but there were a couple of things I noted in a quick read:<br /><br />First, the estimated mix of condos includes 29% one-bedroom units, 45% two-bedroom units, and 26% three-bedroom units (see p.50 in the appendix "Market Value and Rental Estimates"). Thus looking at comparables for just one-bedroom units, or even just one- and two-bedroom units, is somewhat misleading.<br /><br />Taking your Palladium examples and extrapolating: If we assume all one-bedroom units are at $360K (based on the example contract price), all two two-bedroom units at $510K (estimated 15% discount from the example $599K listing price), and all three-bedroom units are at $650K (just guessing here), then given the GGP-estimated mix of units the average price would be just over $500K (0.29 * $360K + 0.45 * $510K + 0.26 * $650K), well above the $440K estimate.<br /><br />Second, since the $440K estimate is an average (not median) price it could be further increased by the presence of expensive high-end units.<br /><br />Finally, the $440K estimate is part of the "high market value" scenario. There's a separate "low market value" scenario in which the estimated average price is $352K (20% below the high market value scenario).<br /><br />So the bottom line is that the estimates used in the analysis seem pretty reasonable to me, and still somewhat conservative even allowing for recent real estate market reverses.<br /><br />A final note in case someone else comments "But they aren't allowing for marketing appreciation over the next 30 years!": All estimates in the analysis document are in fixed 2009 dollars, so using current price estimates for comparables is in fact the correct thing to do.Frank Heckerhttps://www.blogger.com/profile/16845773854690611041noreply@blogger.com