Housing Prices

[TheAnk]

I don't think the niche is big enough.. Let me explain.. Being from Boston, I was relocated to RI for work, and bought here.. I didn't even consider the fact of buying in Boston.. Unaffordable at the time.. But 5 years ago, you could get a 2 family house in Prov for around 100k.. That was shocking.. A small condo in Boston then was low 2s.. and rent for a 1 bed/studio was $1000, whereas the rent for a palatial palace in Prov was 800...

So the disparity between Boston and Prov was gigantic.. The niche clientele for these 400k-900k condos is thin. And you can still buy a condo in a gentrifying area like Southie for high 2s low 3s.. Its as urban there as it gets..

There are commuter people definately opening their eyes to Prov as an alternative to Boston.. But for these high end condos, the price is too high.. They are boston prices to live in Providence.. Not happening..

I personally think the condo market in general in Providence is absurd... There are single family houses on the market for cheaper than condos.. There are 3 decker apartment conversions in the Broadway area going for 280kish EACH FLOOR, when you can buy the whole 3 family house next door for 10k more.. Complete insanity..

So while the top, top end stuff like Cosmo, Plaza, Doran and Chestnut and the new downtown stuff probably will have a market, the next tier will get punished.. They won't sell, will get reduced, and send a wave downward..

Just my opinion. Add in the fact that there are just so many going up at once, I think there will be a glut of available units being severely reduced, or turned back into apartments..

[CtownMikey]

if prices do end up being too high (in providence), can't they just be lowered?

[Magellan98]

I think many are overlooking the fact that there are many people out there who aren't looking for a cheaper, Boston-like alternative. Dare I say that they actually prefer Providence - for being Providence. It's urban, but manageable. It's asthetically pleasing. It doesn't have anywhere near the same amount of neighborhood traffic gridlock that Boston has. Parking, while an issue in Providence, does not require the purchase of a space in a garage or lot for tens of thousands of dollars (though I have heard of many 6-figure parking space deals). Providence is much closer to Newport and South County beaches. I could go on and on. It's not always just a numbers game.

I can't tell you how many people I've met begin fawning over the city as soon as I tell them that is where I grew up. People from outside of the Boston area are especially full of praise. I just ran into an old cowworker from San Diego who got her MBA at BC, moved to southern CT, and has now moved back to the Boston area. After living in Brookline for a year, she's left the city and moved to Canton in search of an affordable home. However, all I kept hearing from her was how much she loves the mall in Providence and that the Prov Mall is where she always does her shopping (forget the fact that South Shore Mall is a few miles north of her house), yada yada yada. I think the reason she didn't move further south is because her fiance is a Boston native, with that Boston is the Hub of the Universe attitude who is working in local goverment.

While Providence isn't for everyone, I think we need to give the city the respect and credit it's due.

[TheAnk]

No question, Providence is great.. I love it.. I prefer living here to Boston... Its not even a choice for me... Quality of life is 1000 times better in Prov, mostly in terms of affordability..

But the bottom line is.. Other than empty nest baby boomers, who can afford these places on PVD/RI salaries? The reason many of us jump directly to the commuter crowd as potential residents is the fact that in order to afford these units, you would need to make sufficient $$... And the money and high paying jobs are in Boston..

[ruchele]

And you can still buy a condo in a gentrifying area like Southie for high 2s low 3s.. Its as urban there as it gets..

<{POST_SNAPBACK}>

Some friends bought a 2-family last year in reasonable condition in Somerville for $525K (split it $263K each with a relative)- a really nice residential neighborhood next to the bike path, 2 min. walk to restaurants, cafes, etc, 10 min. walk to movies, bookstores and the T. That's a pretty reasonable price for a Boston-area house. She rides her bike 20 min. to work at the Pru every day. Not downtown, but certainly not suburban living. And yeah, you can buy a condo in Jamaica Plain, one of Boston's livliest neighborhoods, for $400k-$600k- and JP has FAR more amenities then even downtown Providence, if you ask me.

I think you are right that that price niche is very thin here, and the developers are in for a rude shock. Do you think the highest-end even has the market developers seem to think it does?

Good question- will the prices simply drop to $200k to fill them, or will the buildings sit there mostly vacant, and just be written off as a loss to the developer?

[ruchele]

in order to afford these units, you would need to make sufficient $$... And the money and high paying jobs are in Boston..

<{POST_SNAPBACK}>

Yeah, RI wages don't pay nearly Boston prices, that's for sure.

[runturtlerun]

I personally think the condo market in general in Providence is absurd... There are single family houses on the market for cheaper than condos.. There are 3 decker apartment conversions in the Broadway area going for 280kish EACH FLOOR, when you can buy the whole 3 family house next door for 10k more.. Complete insanity..

<{POST_SNAPBACK}>

I agree! Why buy the condo when you can buy the whole house? Providence has gone condo-crazy, but in many instances these condos are not a good buy. In particular, I am talking about the conversion of two and three family houses, for example, into condos. Apparently, these are not very safe investments because if the house needs a new roof, but not all the owners have the money to pay for it, then the other condo owners are out of luck. RI Housing no longer supports these types of first-time home purchases for this reason.

On the other hand, I ask myself who can afford the $800,000 homes in East Greenwich. Based on average salaries in RI, this seems so unaffordable. But obviously, many families can afford this. So, I think that there will be people that can afford the downtown luxury apartments too (granted they won't be the same families as those that would buy in EG ...). I don't know that much about the layout of these luxury apartment buildings, but it seems to me that it would be a good idea if they included different size and price apartments to reach a mix of markets. If they all go for $500,000 to $1 million, then its certainly more difficult.

[Jenkins]

Some friends bought a 2-family last year in reasonable condition in Somerville for $525K (split it $263K each with a relative)- a really nice residential neighborhood next to the bike path, 2 min. walk to restaurants, cafes, etc, 10 min. walk to movies, bookstores and the T.  That's a pretty reasonable price for a Boston-area house.  ?

<{POST_SNAPBACK}>

I read today in the Boston Metro about people buying two family homes to get into the market. The couple they featured moved to the east side of Providence and bought a two family for $310k. Compare that amount to the 525k listed above for the two family in Somerville. If their budget was in the 300k range what choice did they have, really? If your budget is in the 300k range, then you can't just decide to live in Somerville or JP or Southie and some how "swing" the extra 200k. That difference right there, about 60% more expensive to buy a two family in Somerville vs. Providence, runs a lot of people right out of Boston and into Providence. More people than you might think.

[ruchele]

IIf your budget is in the 300k range, then you can't just decide to live in Somerville or JP or Southie and some how "swing" the extra 200k. That difference right there, about 60% more expensive to buy a two family in Somerville vs. Providence, runs a lot of people right out of Boston and into Providence. More people than you might think.

<{POST_SNAPBACK}>

Yeah, but I guess my question is specifically about the condo thing- I can't see someone spending $500K for a condo an hour away from work, when they could get a 2-family house for the same price a lot closer.

I also agree that some people want to move here just because they love Providence- I'd frankly much rather have those people for neighbors then those who move here as a 2nd choice. A lot of the marketing seems to treat Providence like a Boston bedroom community, which it is not, and shouldn't strive to be, as far as I am concerned. One of the main reasons I moved here was because I was frankly sick of Boston after many years (the khaki horror! The baseball cap travesty!) . This is a different place with its own character and benefits.

[Jenkins]

(the khaki horror!  The baseball cap travesty!) .  This is a different place with its own character and benefits.

<{POST_SNAPBACK}>

You are so right! When we moved here we thought that we would be still going back to Boston on weekends to hang out now and again. That has hardly happened, and mostly because the things we would go back to Boston for are already right here, in a slightly different if somewhat smaller form.

[eltron]

Yeah, but I guess my question is specifically about the condo thing-  I can't see someone spending $500K for a condo an hour away from work, when they could get a 2-family house for the same price a lot closer.

I also agree that some people want to move here just because they love Providence-  I'd frankly much rather have those people for neighbors then those who move here as a 2nd choice.  A lot of the marketing seems to treat Providence like a Boston bedroom community, which it is not, and shouldn't strive to be, as far as I am concerned.  One of the main reasons I moved here was because I was frankly sick of Boston after many years (the khaki horror!  The baseball cap travesty!) .  This is a different place with its own character and benefits.

<{POST_SNAPBACK}>

One thing to remember is that there really are not alot of condo units coming online downtown...it is what, like 500 at most? Most are rentals, and those are doing very, very well (which I can see in the Westminster apts, but Jefferson Place? c'mon.)

I think the market can absorb the condo's downtown, and to a certain extent, event the conversions that are going on. It took me a while to let it sink in, but someone has 2 million bucks from somewhere sitting around, and wants to live on the 35th floor of 110 Westminster. For most though, it really just comes down to affordability. Its good entry into the market. A flat in a triple decker in Jamaica Plain is now $400k. Pretty unaffordable unless you have already been in the market. Same exact thing here. $240,000 (and going up). Much more attainable.

And its pretty hard to get a single fam. house in acceptable condition ANYWHERE in RI for under $225,000. For many, its worth a premium to buy a place in the absolute move-in condition and low or shared maintenance conditions of a condo.

On a related note, I just heard that the market rate units, esp. the highest end, are selling very briskly and almost sold out at the Pearl St. Lofts, but they are having a tough time selling the lowest end affordable units (at $115k and $140k). If you are thinking of buying and think you could qualify for the income restrictions, I'd call them immediately...its a steal.

[Lova]

A couple years ago I did some research and concluded that house prices around Brookline/Newton were 1.5 times Providence for similar stock. Im sure this ratio is changed closer to 2 times now. Cambridge has the highest prices in the country.

Providence is tiny tiny tiny. There are only a few streets - blocks really, where there is anything approaching urban living. The downcity (ha!) condos are creating an urban core that does not currently exist, except in our collective pro-Prov fantasies.

Lowel has a much larger and more beautifull urban core than Prov, but we get all the press. I think the well ballanced financial district towers, standing proud of the old downcity blocks and set against college hill, gives Prov an aesthetic beauty beyond the actual scale of living reality. It has romanitc, postcard views.

That said, the smallness, cuteness, general high quality, and easy accessibilty make downtown condos very attractive. Prov is full. There is very little existing stock left to redevelop, orphaned Olneyville excluded. This creates big up-preasure on prices. Providence is hip, popular and people want to be here.

The new condo and apt projects are coming on so fast that banks are getting scared. I've just been warned that they are loath to finance more until things settle down. So many chefs stirring the pot can crash the market.

[Cotuit]

I think we're looking at Apples, Oranges, Lemons, and Tangerines here. There's various people looking for various things, and not all those things are on everyone's radar.

There are people looking at $500k triple deckers in Somerville, and $350k triple deckers in Providence, and seeing a good investment in Providence.

There are the people who aren't even going to bother looking in Boston because of the price, and are heading to Providence as the best urban alternative.

There are people for whom Boston isn't even part of the equation, they are moving to Providence beacuse it is Providence (the proximity to Boston is a great safety net in case the job market in Providence doesn't end up working for you). People work in the suburbs, not everyone commuting out of Providence is going all the way to Boston. There's plenty of jobs in the 495 and 128 belts. You work between Boston and Providence, and want to buy a home in an urban area, it's kind of a no-brainer.

The people looking at the Downcity condos are not interested in Somerville triple deckers, totally different market. You need to compare Downcity's condos with Downtown Boston condos, which are starting around $700k. And the Boston condos are generally smaller than what we are seeing here. To many of us it may seem rather daft to pay half a million for a condo, when you can buy a triple decker for little more than half that. But some people don't want triple deckers, they don't want to be landlords, they don't want a yard to deal with, or to worry about fixing the roof, or painting. They want a handyman, and a doorman, and a concierge, and on-site fitness center... (actually, this is all starting to sound nice...), and they are willing to pay big bucks for all that (not to mention the views from the top of OneTen are going to be worth a million bucks alone).

Also, the $500k+ units are only a small part of what eltron pointed out is not really a vast market of condos.

[Cotuit]

Or, one could pay $7million to live in Portsmouth.

[ruchele]

The people looking at the Downcity condos are not interested in Somerville triple deckers, totally different market. You need to compare Downcity's condos with Downtown Boston condos, which are starting around $700k.

Also, the $500k+ units are only a small part of what eltron pointed out is not really a vast market of condos.

<{POST_SNAPBACK}>

Both good points. But I wonder if people who want to live in downtown Boston, but can't afford it, are more likely to find what they are looking for lifestyle-wise elsewhere in Boston, or here in downtown Providence? Living in a new condo in Southie is still living in Boston. Living in downtown Providence is not "Boston lite," it's a different thing.

I guess I just fundamentally don't understand the appeal of a condo for a young able-bodied person. But I know it does appeal to many.

By the way, there are now single family houses in Elmwood on the market for the mid $400s. How crazy is THAT?

[Liamlunchtray]

Both good points.  But I wonder if people who want to live in downtown Boston, but can't afford it, are more likely to find what they are looking for lifestyle-wise elsewhere in Boston, or here in downtown Providence?  Living in a new condo in Southie is still living in Boston.  Living in downtown Providence is not "Boston lite," it's a different thing.

I guess I just fundamentally don't understand the appeal of a condo for a young able-bodied person.  But I know it does appeal to many.

By the way, there are now single family houses in Elmwood on the market for the mid $400s.  How crazy is THAT?

<{POST_SNAPBACK}>

I know! I have seen a few crazy expensive houses in Elmwood. There is also a multifamily on Chapin Ave right now for $499k!!! Seems crazy! The 2 family across the street from mine is going on the market soon and I think he's planning on asking $399k. Its beautiful, but it still seems totally nuts.

Liam

[Cotuit]

Both good points. But I wonder if people who want to live in downtown Boston, but can't afford it, are more likely to find what they are looking for lifestyle-wise elsewhere in Boston, or here in downtown Providence? Living in a new condo in Southie is still living in Boston. Living in downtown Providence is not "Boston lite," it's a different thing.

<{POST_SNAPBACK}>

I don't think that people who are weighing their options between Boston and Providence are unaware of the differences in the two cities. Providence offers a lot, but you are right, it's not simply a matter of it being a scaled down Boston, it's markedly different.

But you have to look at this from the point of view of the average person, not the urban enthusiast who goes out of his way to post on urbanist message boards. There are people willing to pay big bucks to live in gated communities in the suburbs, there are people willing to pay big bucks to live in cities like (forgive me), Manchester, NH. For someone looking for just a modicum of urban ammenities, Providence has it going on.

Southie is indeed in Boston, and you can live there more affordably than downtown, but there aren't any highrise condos in Southie offering the amenities that we will be seeing at OneTen or the Waterford (Westin). There's numerous trade-offs. One could pay $2-3million to be in a luxury unit in Downtown Boston (likely steps from work). One could pay $1million to be in a granite-counter top luxury unit in Southie (granite countertop as in that's where the luxury ends, at the counter tops), a subway ride from work (one who's in the million dollar market will be turning ones nose at the subway). Or one could pay the Southie prices for the ammenties of the Downtown unit, by choosing Providence. Yes you have to commute to Boston, but on Amtrak, or the commuter rail, not on the subway with the serfs.

Now not everyone in the $2-3milion dollar market is going to go for the trade-off that has them living in Providence, but we don't need very many of them to do so.

And all that leaves out that we're not ony getting people from Boston. As has been said before, we have people right here in Rhode Island that can afford these condos. And believe it or not, people are coming here from New York and elsewhere.

I guess I just fundamentally don't understand the appeal of a condo for a young able-bodied person. But I know it does appeal to many.

<{POST_SNAPBACK}>

And this is where those New Yorkers come in. The Manhattanite moving to Providence to slow down his pace of life, and live more affordably, will be coming from an apartment living culture. They don't know the first thing about maintaining a home, they want a condo. Get a few a of them, a gaggle of empty-nesters, some executives from GTECH and Textron looking for a pied-a-terre in the city, and before you know it, those condos are sold.

[runturtlerun]

There is also a multifamily on Chapin Ave right now for $499k!!!

<{POST_SNAPBACK}>

I love that house, but I can't believe Armory Properties is trying to get $499k! Its gorgeous, a 4-family too so more rental income, but it needs a LOT of work!

[ruchele]

I love that house, but I can't believe Armory Properties is trying to get $499k!  Its gorgeous, a 4-family too so more rental income, but it needs a LOT of work!

<{POST_SNAPBACK}>

Armory represents the $440K single in Elmwood I was referring to, too.

[eltron]

Armory represents the $440K single in Elmwood I was referring to, too.

<{POST_SNAPBACK}>

Yep. They have the eye for the nice historics. The one on Chapin is the top o' the market for the area, but you're right, needs tons of work ($50k paint job and assoc. work to make it stunning), but it IS one block from Cranston Street. Tough.

Here ya go:

http://providence.craigslist.org/rfs/83194236.html

Beautiful house, but... I almost bought a house less than 2 yrs ago right across the street for $279,000. Oh yeah, but it was for all three units! damn.

[Jenkins]

I don't think that people who are weighing their options between Boston and Providence are unaware of the differences in the two cities. Providence offers a lot, but you are right, it's not simply a matter of it being a scaled down Boston, it's markedly different.

<{POST_SNAPBACK}>

And the other point is that it is very hard to figure out all the reasons people chose a place to live. My specific reasons for chosing where I live in Providence are very unique to me, and I doubt many other people could guess them, just from the outside looking in. The biggest indicator to me that the condo's will sell, and that Providence will continue to grow, are almost intuitive: the fact that this website is so popular, the fact that almost any person I tell that I live in Providence has nothing but great things to say, the fact that Waterfire was featured in National Geographic Travelers magazine, etc. There is energy here. There is momentum. And that, as much as anything, is what causes any entity to grow, including a city.

[Recchia]

Yep. They have the eye for the nice historics. The one on Chapin is the top o' the market for the area, but you're right, needs tons of work ($50k paint job and assoc. work to make it stunning), but it IS one block from Cranston Street. Tough.

Here ya go:

http://providence.craigslist.org/rfs/83194236.html

Beautiful house, but... I almost bought a house less than 2 yrs ago right across the street for $279,000. Oh yeah, but it was for all three units! damn.

<{POST_SNAPBACK}>

My dad grew up on Chapin Ave in a four family....anybody got a link to the one for sale?

[Garris]

But I wonder if people who want to live in downtown Boston, but can't afford it, are more likely to find what they are looking for lifestyle-wise elsewhere in Boston, or here in downtown Providence?

[TheAnk]

The only reason a young able bodied person would "prefer" a condo is $$$.. Entry level starter home.. That is it.. Every other person would prefer a single family of equal price..

RE: Those John Arnold condos that Armory Props have on 225 Carpenter.. I saw them.. Nice, but lets be honest here.. 1200 sq ft apt in a three decker for 269-289k? No thanks.. You can granite counter top the entire apt or palte it with gold and its not worth that.. Armory Properties is completely insane with their asking prices.. Between them and Joy Riley's listings you can pretty much get a weeks worth of belly laughs @ the prices they try to fetch..

So yes, people will want loft condos... They are the hip space that people like.. But condo converts in three deckers are born out of necessity; owners cut up these houses to condos to offer entry level housing in an otherwise unaffordable market. Prov is not that market.. Prov is still decidely affordable, and these condos are listed for more than singles..

Its an inverted market.. Makes no sense.. And its the reason some of these condo converts have been on the market for THREE PLUS YEARS.. Yes, you read that correctly.. Don't be fooled by these re-listings.. If you track MLS like I do, you will see that the same condo converts have remained un-sold for years.. MLS numbers are age based; The agents pull them, then relist the same unit w/ a new MLS number so they don't look stale..

So, its not working, even with the small amount of condos on the market in prov.. If by small you mean 100+... Although, one long standing 3 decker condo listing on Westminster (2+ years) sold last week for an amazing 227k. It was originally listed @ 299k, sat forever witth a ton of reductions down to 240k, and finally sold..

So maybe that will be a harbinger for change!

[urbie]

People work in the suburbs, not everyone commuting out of Providence is going all the way to Boston. There's plenty of jobs in the 495 and 128 belts. You work between Boston and Providence, and want to buy a home in an urban area, it's kind of a no-brainer.

Where's the most economic activity these days, in the 495 belt (or the three-point line, as I used to call it when I lived in Hudson, MA)?

Urb