Luke Juday grew up in a spacious house in a quiet suburb. But at age 25 he and nearly all his friends live small in urban apartments. And they intend to never move to suburbia.
Juday says his strong preference for urban living mirrors that of many in his age group. How does he know? Because as a demographer for the University of Virginia, he authored a new study, “The Changing Shape of American Cities,” which relies on census data to show how ever more young adults are gravitating to walkable town centers and cities.
“The trend is clear in every single U.S. city. I think it’s a major cultural shift,” he says.
In the market? Here are a few pointers for condo buyers:
1 Search for a building in a community with a resilient job base.
The vitality of any local real estate market is tied closely to the employment strength of the area. But as Meyer says, homebuyers shouldn’t count on a single employer to keep the local economy robust.
“To guard against the impact that layoffs can have on property values, buy in an area with multiple major employers,” he says.
2 Review data to validate your hunches about the right condo building.
Your subjective reaction to a condo building can help with the selection process. But you and your real estate agent will also want to seek out objective information to better analyze the strengths and weaknesses of a particular building.
“Ask your agent to look at the resale history for the building going back as far as four years. Take note of the median number of days it has taken to sell a unit there. The more days it takes to go from list to sell, the less liquid the building,” Meyer says.
3 Show skepticism about a building with rock-bottom condo fees.
Nearly all condo buildings impose “condo fees” on their owners. Among other expenses, these monthly charges cover the cost of routine upkeep on the building and its grounds, along with support services.
John Rygiol, a real estate broker who works exclusively with buyers, says some purchasers mistakenly shop for a building with the lowest possible monthly fees. But he warns against that approach.
“A building with very low fees could actually decline in value, due to poor routine maintenance. That could make your unit hard to sell in the future,” he says.
4 Avoid buying in a building with numerous renters.
Meyer is wary of condo buildings where a large number of units are not owner-occupied. That’s because renters have a lesser stake in the maintenance of a property.
“Owners who live in their units feel a natural pressure to ensure there’s sufficient money available for upkeep. Renters feel no such natural pressure,” Meyer says.
What percentage of owner-occupants is enough? That depends on the location of the building. In most cases, Meyer says you’ll want to see more than half the units occupied by owners.
5 Shop for the best available unit in the building of your choice.
Even in the ideal condo building, not all units are created equal. Some are much more salable.
“Two units could have the same exact floor plan. But one that overlooks a beautiful park will be worth a lot more than one which overlooks a parking lot,” Meyer says.