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It's getting harder to overpay...
Listen, I get it. No one wants to be the dope who overpays for a condo in Center City.  If you are my client, it is my job to make sure you are not said dope. 
     But I have to be honest, it is getting a little harder to think that you might be overpaying in the midst of a local market that is segueing from a buyer's market into a seller's market. I am not suggesting that the seller is holding all the cards here in our 2013 Spring Center City real estate market but as I stand on the front lines of the condo market, I see the tides are  turning in favor of many sellers. Not all, but in many segments.  And we are seeing an increased sense of urgency on the part of the buyers coupled with a declining inventory levels- And that equation has to be accompanied by a willingness of buyers to open their purse strings a bit, no? I think it is safe to assume we have bottomed out in terms of value here in town, and I am seeing properties have competing offers, and many developers have raised prices on some of their condominiums.
   As we make this transition into a seller's market, comps are harder to come by, and sometimes you just have to "wing it" in terms of facing higher asking prices. Comps become less reliable as we try to look back over the past year- when the market WASN'T this hot, and try to cobble together a reasonable asking price. One which won't get blown out of the water.  I think we have a very long, if not slow ride up the hill of values for Center City condos- so it IS getting more a bit harder to overpay as the market makes this shift and appears to have a fairly long shelf life ahead of itself.
   So if you are faced with a dilemma of having to pay an extra few thousand to secure the condo you want...then you may just have to suck it up. I'm sorry, but that is what the market is telling us in spring 2013.  
Hottest Market I Have Seen Since Say 2005
 How do I make such a statement? Pretty easily, actually.
I see how many showings I have on various condos (as opposed to the showings I would have had even 6 months ago) and I look at the number of multiple offers, the number of times I have been in multiple bid situations, and also how many condos my buyers have gotten out-bid by stronger offers. Oh, and the shorten "days on market" coupled with "closer to asking"
sale prices.
I sell a lot of condos every year. I watch the condo market here in town like a hawk...it is just my thing. And I can tell you I have not seen this kind of frenzy in a growing number of segments since say late 2005. My production numbers alone for the month make me want to go out in the middle of the street and sing & dance.
Some segments of the market could easily start to increase their asking prices, and still eek some dollars out of the growing number of buyers. I think that is a pretty easy equation when you see multiple offers on day one or two of a new condo being put on the market.  
How much is in the Kitty? 

  You never really know when you are looking at condos how much money the association has on hand. And I am not privy to that information a lot of the time. You will have a "condo doc review period" in which you will find out...but how much is enough? Many larger buildings in town have over $1,000,000, and many smaller associations have zero (in all fairness though, think of how limited the common area is in say a Brownstone Building). I think looking at the overall condition of the building should help alert you to the need for strong reserves (money in the kitty). And comparing that with similar buildings in the area is a good idea should you have concerns.

And here is a new twist I hear from local lenders-


IF A CONDO ASSOCIATION IS NOT PUTTING AWAY 10% OF THEIR MONTHLY COSTS INTO RESERVES....MANY BANKS WILL NOT OFFER LOANS ON SUCH CONDOS....And this may seriously screw with your ability to resell your condo at a decent price....If your condo can't be financed- the demand for your condo is going to fall off the side of a cliff, perhaps.


If I may be the unpopular voice of reason....I think this is a good thing for your association. All associations need a cushion to save for a rainy day. Because you know what?  One day that roof will leak.  And even doing simple upkeep items like keeping the hallways bright, clean and freshly painted only adds to your condos value. Condo buildings are like hair-dos and automobiles- they need to be maintained to keep their appeal.  So collect, save and spend.  Know that new constructed buildings in town may need significantly less in their kitty, as there is no deferred maintenance to contend with....


If you are wondering if your condo is collecting enough money/spending it

in a way to help protect the value of your condominium...

Give me a call and let's chat...perhaps I can give my two cents.

 Mark Wade  267.237.3404

Funny & Stupid MLS Photos :-)
  You have to see some of these:
Priceless!  I know these photos will make you want to call me to buy THAT condo...   :-)
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Mark Wade   Prudential Fox & Roach Realtors
  Standing on the front lines of the
Philadelphia Condo Market Since 1989
And I have to say, the view ain't too bad
here in early 2013....
Mark Wade
Prudential Fox & Roach Realtors
530 walnut St. Phila., Pa. 19106
215.627.6005 / 267.237.3404 cell
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