Condos: A Choice Based on Lifestyle
Nearly half of all condo buyers choose their new homes without considering any other style of housing, according to a new survey by the National Association of Home Builders (NAHB) that examines the preferences of condo buyers. The survey found that the majority of condo buyers are looking not just for a home, but a lifestyle.
With lifestyle and affordability the top factors driving condo sales, most industry experts expect the condo market--which had reached nearly half of all multifamily starts in 2005--to stabilize at a healthy and sustainable 30 percent of the approximately 350,000 multifamily units produced annually.
According to the survey, two groups of condo buyers drive the condo market: young, well-paid professional singles or couples who want to own their first home close to urban amenities; and older households who want to remain in the suburbs but shed the maintenance burden of a house. Both groups also clearly indicated that they expect their condos to appreciate in value.
"The core buyers for our product are single, without children, who want a lifestyle that allows them to enjoy the amenities inherent in a downtown environment," said Judd Bobilin, executive vice president and chief development officer of the Atlanta-based Novare Group, which currently has more than 5,000 condo units in development.
Bobilin noted that buyer traffic at his properties is comparable to the traffic the company saw in 2004, with sales continuing to average about five units per month. He also noted that the number of out-of-state purchasers at his properties has dropped to about 20 percent or less, an indication that buyers--not speculators--are currently driving today's sales.
Bobilin's customers, like the participants in the NAHB survey, identified price and location as the top two factors determining their decision to buy a particular property, followed by size, desirable neighborhood and investment potential.
"This is the first research study that probes the question of where condo buyers buy, why they buy there, and what amenities they look for to complement their new lifestyle choice," says Gopal Ahluwalia, NAHB's staff vice president for research.
For the survey, NAHB used a random sample of 1,008 households that had purchased condos in the past, balanced among the four geographical regions of the country, and representing the low, middle and high ends of the market.
State Place at South End is one of many condo and townhouse communities in downtown Memphis.
Riverside 648 offers breathtaking views at its South End location. According to the Memphis
Center City Commission, the downtown condo market is undergoing unprecedented growth
with more than 3000 condos underway or nearing completion to meet Downtown's 10.3% annual
residential growth rate.
