The market is slowing down…and not just a little! This is not a bad thing. In fact, I think it is very healthy for the market and helps us avoid a big tumble in the market.
Here are a few interesting numbers that support what was just said….
Inventory: Inventory in the area I focus on, from Pacifica Tower just north of the Freemont Bridge to South of South Waterfront, inventory levels are up 21% since June 1st! That is a pretty big jump in such a short period.
Price reductions: Since July 1st, in the Pearl District, 40% of the listed condos reduced their price.
Days on Market: This one is a bit tricky. Days on market has gone up but one must look at this stat carefully. There is a recent trend that is happening more and more. In a practice that I do not believe in, agents will cancel a listing and then re-list it. It is an attempt to make a listing look “fresh” and show less days on the market to buyers. This is why we must look at Cumulative Days on Market. Now if an agent has it on the market for a month and then cancels and re-list it, the number will reflect those 30 days prior.
What this means in the marketplace? For buyer’s, there is not such an urgency to make a quick offer. Buyer’s are able to look around for the perfect place and have a much better foot to stand on at the negotiating table. For sellers, trying for a premium price may hurt you as your condo may stay on the market longer than it should and in the end it may sell for a lower amount than it would have if priced correctly.
An example of this is one I believe I have discussed on my blog. A little over 4 months ago I went to a Broker’s open house on a beautiful penthouse unit. At that time, the agent listed it for $3,550,000. The agent, knowing that I specialize with condos, asked for my opinion on price. I clearly remember my answer: “ I think it needs to be at $2,999,000 and I think it will sell a little below that.” Well today, after 2 price reductions, it is now priced at $2,995,000. But now, after 4.5 months on the market, you will probably get the sharks swimming around it ready to offer $2,600,000. (It has actually been on the market much longer with another agent that was priced even higher!) … again, this is where you need to look at cumulative days on the market!
Moving forward in this new market, correct pricing will be very important in the sale of your condo or loft!
Yesterday I attended a Mastermind meeting that was an invite only meeting for some of Portland’s top agents. The speaker was very good and covered many good real estate topics. One thing that stood out to me though was something very simple and something we, as agents, hear every year. The National Association of Realtors does a survey every year with real estate customers asking them what is the most important thing to them in working with an agent. You might be thinking it should be a “Knowledgable” agent or something about commissions. Once again the #1 answer was honesty! Buyers and sellers want an honest agent, someone they can trust to have their backs.
I bring this up in my blog because of some recent things I have seen in the market. One of those things is the recent bombardment of ads from Redfin and their new 1% listing fee. Right out of the gate, they are missing the #1 thing people want from their broker, honesty! That 1% listing fee is very misleading because the actual cost to the seller is 3.5% ( On top of the 1% they still have to pay the buyer’s agent 2.5%) One of the reasons that the Redfins and Zillows of the world are not doing great is because they are corporations that care about the bottom line…and not the client! Starting off with a lie, in any business, is not your best way to build trust! Unlike the corporations, agents are independent contractors ( even if they work for a larger chain brokerage firm) These independent contractors care about their clients more …it is their livelihood at stake.
I see many ads that are misleading or just plain wrong. I recently saw a website of a new agent. On their website and Instagram site, they state that they are a “Luxury Home” specialist! It is very funny to me, and not exactly honest, that someone who has not been in the market but a few months and not sold a home over $700,000 claims to be a “Luxury Home” specialist? The worst thing is that I know this person. I really wanted to call her and say to her that the #1 thing people want is honesty and you are starting off with something that is not true. I did not call her because I feel it is not my place to do so, but I wish somebody would because it would do her more good in the long run.
Honesty comes in many different forms. I very much appreciate agents that are trying to get a new listing that are honest in their pricing! I see so often agents that overpromise the pricing to get a listing over another agent. What happens in the end is VERY familiar, the home sits on the market forever with no offers, the agent then starts doing multiple price reductions and then finally the home sells well below where it should have if it were priced correctly. Unfortunately that agent still gets rewarded and the agent that was honest in their pricing, the one that might have sold it for a higher price , gets nothing!
There are many really good agents out there. There are many that give you all that they have to do the job right…and that means putting their needs aside and working for the clients best interest to capture the best price for their clients and take care of all of their needs.
In years to come, you may have multiple options in selling your home. We have begun to see programs that are trying to disrupt the way homes are sold. The interesting thing here is that none of these new programs care about getting you a premium when you sell. It is just about selling the home and collecting a fee. I know, as a person that has been in real estate for 15 years, if I had someone sell a house for me it would be someone that I know has my back and truly cares about me and my finances. It would be someone that I know would spend money to market my home in many different avenues to give it the most exposure ( the big corporate discounters will NOT be doing this!) When an agent does this, more times than not, they will sell that home for a premium price…a price that far exceeds the amount of discount that the corporation says they will be “Saving” you.
Please visit my page on marketing: http://www.luxurycondosofportland.com/marketing
In the end it all gets back to what clients are looking for…honesty! The client can be reassured that the person they hired really does care about them and their finances. The agent is upfront from the beginning ( no bate and switch) They can be comfortable in knowing that that the price they are suggesting is accurate and in the end, that agent will do everything that they said they would do!
Brad Golik is a condominium specialist with Total Property Resources and LuxuryCondosofPortland.com You can reach him at 503-896-8856 or at email@example.com
Brad Golik is a condo specialist with LuxuryCondosofPortland.com and Total Property Resources in the Pearl District. You can reach Brad at 503-896-8856 or at firstname.lastname@example.org
Yesterday I listed a condo at KOIN Towers Fountain Plaza. With the “New and Shiny” buildings we have recently seen, like The Cosmopolitan, it’s nice to be able to go back in time a bit and revisit buildings like KOIN Tower. At the end of last year I sold a unit at KOIN/Fountain Plaza on the 27th floor for $1,750,000. It was a large unit with spectacular views. My new listing, just one floor below, and again, it provides some of the best views in the city! This northwest corner unit offers sensational sunset views to the west, amazing Mt. St. Helens and Mt Adams views to the north and Willamette River views to the northwest. This 1950 square foot unit has wonderful open spaces…and those amazing views! The best part of all, at $929,000, you are getting this for under $500 a square foot! Now remember, 26th floor views at The Cosmopolitan went for over $1,100 a square foot! OK, now the KOIN Tower is NOT The Cosmopolitan, but it represents luxury at a good value!
I believe we are at the beginning of a major transition in the KOIN building. Many of the original owners are gone and a newer, more thrifty demographic is buying in. There are not many condo buildings being built right now (The Vista) and I can see moving forward, many buyers recognizing the potential and value in a building like KOIN Tower/Fountain Plaza.
While current owners at the KOIN have not really participated in the run up of prices the last 10 years, buyers today will find a high quality building with unmatched views and will benefit tremendously moving forward. The area around KOIN Tower is also improving with several hotels with new restaurants, and a high- end grocery store. I cannot really think of a better time to buy at KOIN/Fountain Plaza than right now. To set up a time to see unit #2604, give me a call and be ready to be wowed by some awesome views! If you would like to tour this fantastic unit, give me a call today!
Video at: Aerial KOIN Tower
Brad Golik is a condo specialist at LuxuryCondosofPortland.com and Total Property Resources, LLC. You can contact Brad at 503-896-8856 or at email@example.com
We have not seen many new penthouses come onto the market lately in the Pearl District but we should see a nice one come on by the end of this week and it is in one of my favorite buildings, The Elizabeth. This 15th floor Elizabeth penthouse will be priced at $3,650,000 (so I have heard) and offers 3,443 square feet of living space. If you are in the market for a beautiful penthouse in the heart of the Pearl, give me a call and be one of the first to see this unit!
I mentioned that The Elizabeth is one of my favorites and the reason behind that is that it is a building with a ton of details and character! John Carroll, the developer, does some of the best designs in the city and is a developer that actually spends the money for the extra touches that set his buildings apart from the others. Recent development in the Pearl, including Hoyt Properties Vista, seem very vanilla in comparison with not much thought about the architectural aesthetics involved. Even now, as Carroll introduces his newest project, The Dianne, touches of quality design can be seen, even on this building that has been built to house those wanting to rent instead of buying.
Last night as I drove by the Dianne, I noticed that even the lighting on the building gave it a dramatic look that we have not seen in the last several developments in the Pearl. Like buildings before, such as The Gregory and The Elizabeth, you see touches of detail that often get eliminated by most developers that try to squeeze every penny from the development. On the Elizabeth, you notice many details when you walk around the building starting with its trademark entry doors. Then you notice the tremendous amount of the wrought iron designs all around the building that give the Elizabeth its character. These were a tremendous extra cost to the developer that he could have avoided and increased his profits. Instead, this developer choose to make a lasting impact on a great neighborhood that also has much character. For that, I say thank you to developers like John Carroll!
Brad Golik is a condominium specialist with Total Property Resources and LuxuryCondosofPortland.com. You can reach him at 503-896-8856 or at firstname.lastname@example.org
As many of you know by now, Pearl District Properties has shut it’s doors. I am still in the Pearl District and now at Total Property Resources!
Brad Golik is a condominium specialist working in Portland’s Pearl District, Downtown and South Waterfront.
Just yesterday I was having a conversation with two other agents who do a fair number of condo sales. The topic of conversation was the market and the consensus was that it has definitely seen a slowdown in pricing. With the increase in inventory, we are noticing a slowdown in terms of appreciating prices. In some cases, the pricing could even be slightly less than what we have been experiencing for so long.
And then this happens! Just this morning, on the MLS, a penthouse unit at The Casey went from pending to sold. The unit never hit the market. The sold price, brace yourself, $4.5 million cash! Unit #1503, is a 3667 square foot condo that faces the West Hills. Consider these numbers for a moment. At $4.5 million, this is $1227 per square foot! Let’s compare this to the recent penthouse sales at The Cosmopolitan. Now keep in mind, for comparison sake I will use the penthouse units from the 27th and 28th floors at the Cosmo. The combined unit on the 27th floor sold for $5,441,294, or $1216 a square foot. The two top floor penthouses on the 28th floor sold for $1215 and $1225 a square foot. These units are 13 stories higher and have superior views of the Mt. Hood, Mt St. Helens, the city and the Willamette River.
I will say, The Casey has always been one of my favorite buildings… but really? Is this unit worth nearly a million more than a 28th floor, true penthouse that is 13 floors higher? While the Casey unit does have around 400 square feet more space, (which does not really mean that much once you get over 3,000 square feet) the potential for having views blocked are much higher for a unit that is only 15 stories compared to a unit that is 28 stories. After all, one of the reasons people paid such a premium for these Cosmo units is the fact that the views will be protected much more by being that high up.
What is even more interesting is when we compare the sale of this unit to one that just recently sold at the Casey, unit #1602. This true penthouse unit one floor above has similar views. It has 3273 square feet and sold for $2.75million or $840 a square foot….WOW!
Contact Brad Golik at 503-896-8856 or at email@example.com
Visit us at www.LuxuryCondosofPortland.com
See Cosmopolitan views here: http://www.luxurycondosofportland.com/thecosmopolitanportland
Because I was short of time this week, I thought I would do a video post!
Just like many days, I start my day at Starbucks getting a cup of coffee and checking emails. Yesterday, while in Starbucks trying to warm up, I was speaking on the phone with a client about the current condo market. A very nice lady sitting next to me had heard a few things I was saying to my client and when I got off my phone she had many questions for me. No matter where you go, people always seem to like to talk real estate! This person, who I will call Sue, had many questions but the one she seemed to have the most interest in where my thoughts on the new Cosmopolitan. I did start the conversation with her explaining that I have discussed this project many times here on my blog, and it has not always been favorable. She explained to me that she was one of buyers that have now pushed the project to 88% sold. But she was insistent that I give her my honest opinion…so I did! I did start the conversation saying it was a nice building that I believe residents will enjoy for sometime. She asked me about the pricing and I explained to her my take on the pricing. When I explained that I thought it was fairly overpriced she agreed with me and then went on to explain why she bought. The current unit she was in had it’s views blocked by a new building and she wanted something with a view. She said she had been waiting for a view unit to come on the market but got tired of waiting. This is why she said she decided to pay a higher price than she felt comfortable with. I believe this is the exact situation that most of the Cosmopolitan buyers ran into. They wanted something in a nicer building and nothing was coming on the market! They did not have many options and decided to pay a higher price instead of waiting. After discussing the pricing of the building, Sue then asked me what I thought about the building. Being a future owner, I wanted to be somewhat polite and gave her somewhat of a sugar coated answer. She saw right through my answers, looked me in the eyes and said “What do you really think?” So, I told her!
I told her that early on in the design process the developer had called on many of the top condo agents to give some feedback on the project and to make suggestions as to what they thought our clients would like, which at the time I thought was a smart thing to do. There were some very good suggestions that agents made, most were not implemented. For example, large decks. This is something all condo buyers would like to have. The final build out is nearing the end and one thing I will say, VERY small decks for a majority of the owners! Other simple things were suggested. One of my suggestions, which I had seen in buildings in Seattle and Denver, was a small area on the Mezzanine level where owners could take their dogs for a walk, and do their business. This so that owners don’t have to go down to street level and worry about safety later at night. Again, it didn’t happen. Other agents had suggested a better variety of cabinetry. While Pedini is nice, it’s not for everyone. So instead of variety, the future owners were offered super contemporary with a choice of light, medium and dark! This was something Sue said she struggled with. To me, it did not seem that the developers listened to the agents much. While I was hoping for something very special, to me it is just like The Metropolitan, just a little taller. Now don’t get me wrong, I love The Metropolitan! In fact, architecturally, I like the exterior look of The Metropolitan much more. But for the prices being paid, I was hoping for more. For something pretty special. For these $800 to $1200 a square foot prices, I was hoping for a building with more amenities like those in the Insignia in Seattle, Lumina in San Francisco , Bellevue Towers in Bellevue,WA. Or Spire in Denver. ( http://www.insigniabybosa.com/#/tour , http://luminasf.com/amenities/ ,
http://bellevuetowers.com/#building , http://www.spiredenver.com/amenities/ )
Now, some of these nice amenities come with a price, higher HOA fees. Part of the problem with most of our buildings is that we do not build high enough. While 28 stories at The Cosmopolitan is a good start, it is still not enough to spread the cost of amenities like those at the above mentioned buildings. When you have a building that is closer to 40 stories, it is much easier to spread the cost among more owners. When I toured Spire in Denver, CO (41 stories), I was blown away by the fantastic amenities…and then I was really blown away when I saw the owners were paying about half of what typical owners in Portland’s nicer buildings were paying for their HOA fees. While there are many people that are opposed to building higher, it is what makes the most sense if people want nicer amenities and also keeping their monthly cost lower. Imagine if you will, in the location of the current Centennial Mills, a beautiful waterfront condo building much like that of Bellevue towers. Two 40 story towers that offer the most amazing views, and to be right on the river! Sit on your large deck and take in views of Mt. Hood and the Willamette River. Between the two towers, you have a spacious, park like mezzanine level where you sit by an outdoor fire sipping wine and watching ships pass by! In the summer months, you join your neighbors at the outdoor theatre to watch movies. Perhaps you are a little more active and wish to go swim laps in the indoor pool and then relax afterward in the steam room or sauna.
Ok, back to reality! Big, usable decks would have been a good start!
Brad Golik is a condominium specialist with Pearl District Properties. If you would like to tour some of Portland’s luxury condominium buildings, call Brad at 503-896-8856 or visit http://www.LuxuryCondosofPortland.com
When writing in a blog, it is sometimes difficult because you put yourself out there to occasionally be wrong. When I get feedback from readers it is often appreciated. It is not always positive, but that is ok! After my post the other day about the $2,975,000 unit that I felt was actually under priced, I got an anonymous email from someone that wanted to call me out on a comment a made a short time ago about a unit right down the block I thought was overpriced. That particular unit was another one of the iconic townhomes on 11th that was priced at $1,899,000. That unit was recently sold for $1,850,000…a number I still think was too high. Remember, this townhome had a neighbor that sold about a year ago (with virtually the same high end finishes) for $1,390,000. Do you really believe the market is up 33% in that time span? It’s not! But let’s take a closer look.
The listing agent did get a good price for the seller but this opens up a whole different issue because the agent also represented the buyer. While it could be said that he got the sellers a good price for their unit, the buyers, who he was also representing, overpaid! I am not a big fan of agents representing both sides in a transaction. Have I done them before? Yes, but it is with full and absolute disclosure. Do you think this agent told the new buyers it was overpriced? Now the market value is what someone is willing to pay. I agree with that but, buyers come to us for guidance and our experience and knowledge in pricing. You cannot be telling one party it is a great selling price and then at the same time be telling the buyers it is a good purchase price. As an agent, my duty to the seller is to get them the very best price that I can. In doing so, I will not put my integrity at risk just to get both sides of a transaction. This is where a good agent must step away from both sides of a transaction and focus on his or her duty of getting the best price for the seller. To be fair to the other agent, maybe this agent did disclose to the buyer that they were overpaying for the unit and they were ok with it. Do I believe that the agent said to the buyers “This unit is priced over 33% from it best comp that sold a year ago and the market is certainly not up 33%”. I doubt it seriously.
I do not have a problem with an agent handling both sides of a transaction when something is reasonably priced and full disclosure has been made. When something is selling at 33% over its best comp…that is a whole different story.
As a buyers agent, I would not have advised my clients to pay over $1,750,000 for this unit( still over 26% from comp). If the buyers loved it and were ok overpaying for it, this is ok as it is their choice. But if they are receiving guidance from an agent whose main responsibility is to maximize the sales price for the seller…? I wonder what that same agent would have thought it was worth working as a buyers agent only for someone? Unfortunately, it is sales like this that will mislead inexperienced agents into false pricing. The next thing you know is we will see some agent trying to price one of these single units for $2,000,000!
As for the person that wanted to call me out for being wrong, that is ok! It is people like you that keep me on top of my game so I actually appreciate you and thank you for your comments. I will not always be right but you will always get my honest opinion. Also keep in mind though, it is always good to have a good understanding of the whole picture before making comments, and this is something I always work towards. So in closing, yes, I still think 617 was in fact, overpriced!