Why Downtown Condos Cost $250,000
For those who were asking why downtown housing seems so expensive, and whether affordable housing will ever be next …
Why downtown condos cost $250,000 By Steve Lackmeyer
| Tuesday, April 10, 2007 Edition: CITY, Section: BUSINESS, Page 4B |
For the past two years, the question has lingered among those watching the emergence of housing in downtown Oklahoma City: “Why are so many of the new units priced at $250,000 and up?
Such pricing left a lot of young urban professionals who rent downtown frustrated. They could afford to jump from a $750 a month rental payment to a $1,000 condominium payment. But $1,000 a month doesn’t get you past $200,000 without a hefty down payment.
It’s not as if downtown developers haven’t known all along about this pent-up demand. While they might make more money on a half-million-dollar condo, they would be assured a quick sale with units averaging $150,000. Yet in almost every major downtown development announced to date, the prices continue to hover at $350,000.
The Oklahoma City Urban Renewal Authority, recently given a choice between a mixed-use development of lower-price condos and apartments versus high-price residential towers for MidTown, went with the upscale product.
Credit Brett Hamm, president of Downtown Oklahoma City Inc., for offering an explanation that sheds light on the question of high-price housing.
The slant toward higher-price housing isn’t by coincidence — it is a grand conspiracy. Well, that’s not exactly how Hamm worded it. But here’s his take: you have to start somewhere.
You can start with expensive housing in an area and then eventually add lower-price choices to the mix. But you can’t start developing an area by building a lot of lower-price housing and then hope to add more expensive units later.
Downtown housing really was a blank slate as late as 2000. It was then that a study by Houston-based CDS Market Research reported 6,000 people desired to live in downtown Oklahoma City but their interests were thwarted by a lack of available housing.
That was the match that lit the fuse.Much of the development involves land controlled by the Urban Renewal Authority. The Hill, Block 42, The Centennial and now Overholser Greens all are Urban Renewal projects, all involving products generally priced north of $200,000.
Also priced higher than $200,000, but developed privately, are the Brownstones at Maywood Park. On the other side of this equation are the Central Avenue Villas, the Harvey Lofts and the just announced Lofts at Maywood Park as developments offering at least half of their units below $200,000.
But the number of higher-price units far out-number the ones that will be sought after by all those aspiring homeowners living in the Deep Deuce apartments.And that’s just fine with Hamm. One of the often-told rules of buying a home is to avoid the highest-price house on the block.
Take that wisdom downtown and you can see why it’s so important to get the high-end housing under way. You don’t want to buy a $400,000 house surrounded by $150,000 homes. But who doesn’t want to buy a $150,000 house surrounded by $400,000 homes?
Of course, the next question is whether all of this expensive housing downtown will sell. The results aren’t quite in yet, but with The Centennial a virtual sell-out and half the units sold at Block 42, the grand conspiracy is far from a failure.
One year has passed since I wrote this column. Since then, we’ve seen a sell-out at The Centennial and the Harvey Lofts, and only a few units remain at Block 42. Developers at The Hill have not disclosed their sales, and it’s too early to say whether The Brownstones at Maywood Park or the Central Avenue Villas will or won’t be a success. And one more thought. There are two city-oriented online forums in this town, www.okctalk.com and www.okmet.org. Both boards have members discussing this topic, but notice the difference in how they do so.
Here’s the okmet discussion.
And here’s the okctalk discussion.
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Comments
I can’t see a good reason to pay more for a condo than a detached home. We see the crazy condo prices here in San Antonio as well. I single detached home will almost always be easier to sell and even if you live in a gated community the association fees are generally much less. Drive an extra 20 minutes and quit worrying about being so hip and trendy. Condos just don’t make much sense.
I’m originally from OKC. All my family live there and had thought to look for a condo to retire there. However, I am looking at what is on offer and comparing it to other inner city cores I have lived in, in the past. NYC, Chicago, Toronto, among other smaller cities around two hundred thousand people. The BIG difference here is that part of being a condo dweller in the inner city that attracts people is the easy access i.e. walking to everything. OKC still does NOT have this. The prices for the condos on offer are in line with the area in many ways but, the inner city amenities are not there yet.
I’m not sure I’d like to commit that much money to an inner city condo in OKC without the public transportation availability that works so well in so many other cities. Going to the grocery store? You have to drive, going to the pharmacy in the evening? You’ll have to drive. I still don’t see OKC downtown as having the same community spaces as other cities. It’s trying and maybe some day but, not right now. I’m keeping an eye on things though.
It almost looks as if these condo buildings are going in plopped near some amenities but, without actual living day to day amenities in place. The need for a car in most inner city urban centers is eliminated. That and the need for great parks and green spaces being kept in tact. Avenues, with trees etc….OKC could be great in that urban core but, it can’t just be a few condos near Bricktown or one library or one center. There’s got to more of a community core space that people call a “home” than that.
One thing OKC needs to do is REALLY strive for full public transport that is safe, available, reliable and affordable. Most people I know in condos in many other cities don’t even need to own a car! Everything they need is within walking distance of their condo. If they go on a long trip they just rent a car for that purpose or take cabs. OKC, if it wants to urbanize needs to do what other cities that are successfully urbanized downtown do so well. Easy transportation and daily amenities within walking distance of these condos, not just restaurants and bars and arts centers but, real amenities like green grocers, drug stores, flower shops, you know things a “main street” has. Without those the condos will still be in an urban no mans land except for the “eat out” crowd and some amenities for the arts. It has to be it’s own “town” in the core. Right now it’s really not there yet. So I wouldn’t pay three hundred thousand to live down there. More underground parking would help too to get rid of so many unsightly HUGE parking lots. Those things are a no mans land of wasted space and do not contribute to a community gathering space at all.
Having said all that, I am encouraged to see OKC striving to revive that core and make it a real living space. My father owned a store down there for many years and it was discouraging to see how far down the core went for so long. I am so urbanized now, when I come home for a visit my sister laughs at me thinking I can hail a cab to go about anywhere and such. This needs to change. OKC has always been a huge “driving city” and is spread out but, it is NOT impossible for it to become a fully serviced public transport city like others, NOR for the core to be serviced by the same amenities as the suburbs. The reason most downtown cores are more expensive in other cities is that ALL the arts attractions are in their cores BUT you can also live in them. Go to your grocer, your doctor, your hardware store AND have access to the best arts activities, museums etc. OKC does not have the same living attractions in the core of these other cities…….yet.
Add to this that OKC’s core is competing with their suburbs with VERY affordable housing. Solve the transportation and daily amenities issues FIRST before you start adding in more restaurants etc. Each of these buildings would do well with a ground floor grocer for quick access. OR if OKC had an underground like a subway the space under these buildings could be used for shops too. I’m just dreaming and I love OKC but, it’s got a long way to go before justifying the kinds of prices some of these condos are going for.
I adore Block 42 and the townhouses…though they just are not “quite” there yet. If I am living in a condo and trading off having no adjoining walls for “easy access” then there needs to be something there to access besides “entertainment” People have to live day to day. Also, retirees with some cash could be buying up these spaces but, they want to know they will NOT have to drive to everything if they go into a condo space downtown. Why move into an urban area if there’s no “there, there” yet and pay the same as you will pay for a luxury home in the same city? It doesn’t make sense.
All this said, I’m thinking of perhaps buying a space downtown and putting in a green grocer near these existing condo units somewhere. These people need COMMUNITY businesses that they can use every day.
[...] Sometimes comments get posted on older articles at OKC Central and don’t get properly noticed. Such was the case recently when visitor Diane Hooper posted the following comment on an article published two years ago – “Why Downtown Condos Cost More than $250,000.” [...]
$250k for a condo, I wish. You shoudl see what the prices are like in Los Angeles.