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Putting a Value on Your New Orleans Condo, It’s more than just how large the condo is….

   

      The value of a condo is determined by location, condition, style,bedrooms and size of the unit.  Too often many agents, sellers put an over emphasis on the square foorage of the condo. It is a very important factor but other factors should be considered when making an evaluation. Many of these factors can be emotional.  Over the last 15 years of selling over 200 condos here is what I learned.  These factors add value because of the demand for these factors.

 

      Rather than talk about each factor,  I will show you many of the itmes that are desired in a New Orleans condo.  A good appraiser and agent will take all these things into account when establishing a price. If condition and location are equal then these factors will set your unit apart from others.

 

Balconies are a big factor….

 

Royal Street Ferns at Dumaine Street

Views, What you see out the Condo.

1107 S. Peters 413, Federal Fibre Mills Condos, City Views

Pools and Courtyards do Matter, Common Areas

1107 S. Peters, Federal Fibre Mills Condos, Gym and Pool

837 Royal Street  Pool. French Quarter Condos

Large Windows, Natural Light, Window Features

289 Cotton Mill Condos, Exposed Brick

High Ceiling and Wood Floors are  Demand Items

333 Julia Street 226, 14 ceilings, Julia Place Condos

OLYMPUS DIGITAL CAMERA

Parking Spaces are a large factor…

333 Julia St. 209, Garage Parking

Amenties such as rooftops and Common Areas

333 Julia St. 209 Roof Top views

1107 S. Peters, Federal Fibre Mills Condos, Lobby

Historic Features are Desired….

289 Cotton Mill Condos, Exposed Brick

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New Orleans Condos….How do the Common Areas and Amenities Effect the Value of your Condo..?

     Besides Location, Condition, Size and Parking in the New Orleans Condo Market; Common Areas are becoming a more important factor in value and in demand.  More people want areas where they can relax without going outside the complex.  These amenities are courtyards, pools, gyms, lobbies, atriums and things that add to the pleasure of condo living in the city of New Orleans.

      One of the best ways is to show you the types of things that you will not often see from the outside of the condo complex. So lets take a look at some of my favorite ones….Lets start with the pools.  It is as much as the visual images as people wanting to swim.  Having a pool in the courtyard is so soothing and cooling on a Summer day and we have plenty of those. Water tends to have the relaxing effect…..

     What a great way to meet new people.  A great way to bond with your friends.  Your pets like the outside areas where allowed. If this is a second home then you want and appreciate areas to relax and enjoy family and friends. Most courtyards have grilling areas and grills.  Just bring your own food and drink. No need to drive or dress up if you just have to walk out your door….

     Take a look at some of the condo complexes and see what you are missing or have not seen what some of the common areas look like.  The better the areas are kept up then the more valuable in the long run.  Most are well kept and clean everyday.  You do pay for these in your condo fees.

Condos on Chartres Street, Pool and Courtyard

French Condos On Chartres

837 Royal Street L, Courtyard and Mini Pool

French Quarter Condos on Royal Street

917 Toulouse Condo Association , New Orleans French Quarter

French Quarter Condos on Toulouse

420 Old Hammond Highway, 329 , Courtyard views

Pontchartrain Place Condos in Metairie

3915 St. Charles Ave. Condos, View from front Door. St. Charles Gardens Condos

3915 St. Charles Ave., St Charles Gardens

3126 Edenborn Condo, Pool and Patio

Villa D’ Orleans, Edenborn in Metairie

448 Julia Street Condos, Roof Top Views

Gallery Row Condos, New Orleans Warehouse District

1107 S. Peters, Federal Fibre Mills Condos, Gym and Pool

Federal Fibre Mills Condos, Warehouse District

1107 S. Peters, Federal Fibre Mills Condos, Courtyard

Federal Fibre Mills Courtyards

1750 St. Charles Ave. 639 Large Courtyard

1750 St. Charles Ave. Condos, New Orleans

448 Julia Street Condo, Gallery Row Condos, Courtyard

448 Julia Street, New Orleans Warehouse District

3300 St. Charles Ave, Commodore Condos in New Orleans3300 St. Charles Avenue Condo Entrance

700 S. Peters Condos, First floor Atrium700 S. Peters Condos, Light and Atrium

837 Royal Street L,Courtyard and Pool. French Quarter Condos

817 Royal Street Condos, Courtyard and Fountains

1107 413 Federal Fibre Mill Condos, Lobby

Federal Fibre Mills Condos, The Lobby

333 Julia Street 213, Julia Place Condos Club house on Roof

Rooftop at Julia Place, Warehouse District

Federal Fibre Mills Gym, New Orleans Warehouse District Condos

3915 St. Charles Ave. Gym and workout room. St. Charles Gardens

Metroview Condos, Balconies with Ken, Metairie Condos

Cotton Mill Condos, New Orleans Warehouse District, Front door 920

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Three Big Positive Financial Factors of Owning a New Orleans Condo that Buyers Should Remember….It all Adds Up…

What will the NOLA Condo Market be like in 3 to 4 years ?

    People who buy condos tend to move more often than home buyers for a variety of reasons.  People out grow their condos, get better jobs, graduate from school and have to move to another location.  Many will buy a condo because they know they will be here for a shorter time and buying a condo makes more sense.  I am often asked what the market will be like in 3-4 years and will I make money if I buy now rather than rent.  I can only tell them the present trends. I would only be guessing as to what the market will look like in the future.  I can give buyers and sellers a view of the past and the present market trends for condos.

    One thing I can tell them is that may not have factored into the purchase equation is the financial benefits of owning for several years.  You may or may not have appreciation on the sales price but you will get two other large  financial benefits.  At the low rates that we currently have, the “plus” factors are even better.  Lets use $200,00 as a loan amount to see how it works. Lets use a $250,000 sales price.

Paying down the Principal

     Your monthly note is broken down into several large numbers once you take out taxes and the HO6 Insurance policy.  Over a four-year period you will pay down the principal by $13,819.64 at a 4.5% rate.  That is an average of $287.97 per month that you are decreasing the amount you owe.  When you sell, you will get this back as equity that has built up over time.

      You can get lower rates if you finance for 5 years or 7 years amortized over 30 years. You just have to pay off the mortgage in 5 or 7 years.  The pay down of principal increases monthly. Going from 263.37 in month One to $314.03 in month 48.

The Mortgage Interest  Deduction

      The interest you pay over the 48 months is $34,819.12.  This is the cost to borrow the money.  As a home owner you get to deduct the interest you pay on your taxes.  If you are in the 25% tax bracket your deduction is 25% of $34,819.12 or $8407.78. This how much you save on taxes over the 48 months.  You save $8407.78.  The out-of-pocket expense is thus lowered by an average of 181.35 per month over the 4 years.

The Appreciation Factor

      This is what we do not know because we cannot see the future.  Lets just say if the property appreciates by 5% over the 4 years. This is big money.  This has done this in the past and could do it in the future. Last year alone you condo could have easily appreciated 10%.  This figure is based on the sales price.  Let say you paid $250,000. The 5% increase would put you at  an increase of $12,500 over the 4 years.  This number is not certain. Over the last 10 years we have seen 6 years of appreciation and 4 down or stable years.  The down years were 2008-2009.  The even years were 2010 and 2011.

Adding the Number Up

       Paying down the principal and getting the Mortgage Interest deduction is a given and are known factors. If you get the 5% appreciation then it really adds up in your favor. That all adds up to……

$34,727.42 Versus ($72,000) in Rent

That adds up to almost a thousand dollars per month.  You will have expenses as well but you can easily pay $1500 per month or $72,000 in rent over the 4 year period. You never see this again.  This is an especially valuable set of number of you are a student, medical student or resident when you know how long your stay in New Orleans is going to be…..

new-orleans-river

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New Orleans Warehouse District Condo Market Lacks Inventory as We Enter Feb. 2014, Why is the Question?

     The New Orleans Warehouse District has few condos for sale.  It is really strange that there are only 12 active listing in the area. There are 7 units below 400k for sale and 5 condos above the 400k range.  Out of the 12 condos for sale, I know at least half of them are just asking too much.  Prices were up an easy 10% in 2013 but some are easily 20% overpriced.

      In the last 5 years the majority of my sales came form condo sales in the Warehouse District.  Now  we have to work other areas that offer more properties at more reasonable prices.

     Why are there fewer listing?  I am guessing with interest rates below 4% where a lot of recent sales were bought at and a great rental market, many owers can rent at a profit.  Many think pprices are still going to go up.  That may or not be the case.  Another reason is that no new units built in the last 5-6 years.  The 425 Notre Dame is being built right now and most of those are over 600k.

    There are plenty of new rental conversions.  There is historic tax credits availaible to developers for rentals that mature in 5 years and its worth millions to them.  They will not convert early if the rents remain high and they can cash in on the Federal and State Historic Tax Credits.

     There is the extra demand for second homes in the area.  This also puts upward pressure on prices which was not as big several years ago.  Many of the second homers are Baby Boomers and people who have business in New Orleans on a regular basis.

     Once clients see that the supply is very limited, many will look in other areas where the prices are better and there is a lot to do.  The Lower Garden District is getting much of the over flow as are condos on St. Charles Ave.  Many however just want the Warehouse District so there is always a demand for places that are priced right. You See it, You Like it, You had better act quickly….

Streetcar 2014 Canal Street

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What will 2014 Bring in the New Orleans Condo Market ? A Few Changes that I have Noticed…

Newsletter 2014, Oak Tree

 

A New Year and a New Market in Real Estate.  Since the concentration of this blog is about condos I will give you an overview of the market in Condos.  The French Quarter, Warehouse District and Uptown are aall doing well.  The market is Jefferson Parish is still not doing well.  The rental market is very strong.  The strong rental market is making people in Jefferson to take condos off the market and rent them.  The Owners in Orleans can easily rent ot cover their cost and watch their values go up. This is one of the reasons I think there is little inventory on the market today.

The low interest rates have made for low notes.  Tis will also make it harder to part with your condo to move to a higher note.  The interest rates are trending up and the best this week was 4.5% for one of my clients.  You can expect the rates to rise over the year.  There are however more lenders locally competiting for your business for their own portfolios.  You pay 1% for the money and make almost 5% wiith higher fees.  No wonder they want your business.

The Second Home is still very strong with a lot of cash buyers and those willing to put down high percentages above the normal 20% downpayment.  The one thing that is different this year is that many second home buyers expect to live here part of the year and make it a part time home.  You see a lot of baby boomers in this category.  New Is just a lot of fun and that is how they want to spend their time.

We are also seeing more second home buyers in the market that do not live that far away.  Baton Rouge comes to my mine first. Its 70 miles up the road and makes it an easy weekend visit.  They also tend to know more about New Orleans and where areas they want to be in. This is kind of a new trend but after selling 4-5 people from Baton Rouge lately I see the trend.  You also have people from Kenner, Mandeville, and Slidell which are een closer places.

Old New orleans Homes and Old Cars

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Condos in Metairie, La. Have We Seen the Condo Market Bottom in Jefferson?

       The housing market has been strong for all of 2013 in East Jefferson with fewer listing and quick sales being the norm in most areas.  Generally when this happens you expect to see condo sales rebound as well.  You just never know when that may be.  I am thinking that time is now is now.

       The interest rates are climbing so buyers are thinking it is time to act.  The interest has picked up as rents are also going up in all categories.  Much of the inventory that was not selling has been rented out as the rental market for condos has been great all year long.

       People that are downsizing are also looking again to downsize and a condo may fit their need.  They can now sell their house in a good market so they know it is time to act.

     First time home buyers are finding the New Orleans Market almost twice as expensive as areas in Metairie, Harahan, River Ridge, Old Metairie and Old Jefferson.  There only choice may be to buy in Jefferson Parish for what is like a ” half price sale”  The prices have not gone up which makes it better for all buyers looking for a place.

      Many times the condo fees alone are less than the insurance on buying a home.  You then get insurance, water, trash, and upkeep in that fee.   The condo purchase is a more carefree way to live where you are basically renting to own.  You get to deduct the interest on your taxes and build equity at this still low rate environment.

    One other thing I have noticed is fewer older people have been looking and buying.  We are beginning to see some interest in that segment as that was always a large share of the condo market in Jefferson Parish.

Metroview Condos in Metairie, Front Entrance

      The Metroview Condos in Metairie is a great example of what is one the market.  The condo fees for a one bedroom is $162 per month.  The one Bedroom townhouse units are $109,000 along with several good deals to be had on some resales as well.  The condos are almost new and have some great common areas. Included in the fees are water, insurance, upkeep, management fees, common areas, trash, gated parking, and visitor spaces.

      The common area include two swimming pools, full gym, on site management and green spaces.  You are close to shopping areas and all kinds of eating and drinking establishments.

Metroview Condos, Swimming Pools

Metroview Condos, New Appliances, Metairie Condos

Metroview Condos, Common Areas

Metroview Condos, Balconies and Patios fro each unit

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The Lower Garden District of New Orleans is on a roll as a “Place to Be and Live”…for Condo Sales…

New Orleans Condos in the Lower Garden District

The Lower Garden District of New Orleans is fast becoming the next Warehouse District of New Orleans.  The Warehouse District Prices are increasing so the value next door in the Lower Garden District are going to more growth than ever.  I have sold a lot of places in the area and know all my clients who were second home purchaser and those that bought their condo as a primary residence are all happy and glad.

Right now you are getting a larger and more updated place that you could find in the Warehouse District.  Parking is rarely an issue with a lot of condos having their own parking or easy street parking.  The prime area is between St. Charles Avenue and Magazine.  This area has seen strong retail growth in all categories over the last several years.

The Best way for me to show you the area is through photos of the condo associations, historic homes, parks and places people go to enjoy themselves.  Check out the full page on the New Orleans Lower Garden District Condos for a more in depth look.

Lower Garden District Map, New Orleans

 Overview of the Lower Garden District with Photos

Coliseum Square In New Orelans, Fountain

Coliseum Square, Lower Garden District, New Orleans

The Coliseum Square was laid out as a planned community in the early 1800’s and the Square was a focal point of the neighborhood.  Now you have this as a green space for recreation for the entire area. It is only 5-6 blocks from the Warehouse District.

Historic Homes in the Lower Garden District

Garden District Home, New Orleans Condos

Lower Garden District Home, Looks like a Plantation

Condo Associations in the New Orleans Lower Garden District, These are a few of the Many

1520 St. Mary Condos, New Orleans

1520 St. Mary Condos

2325 Prytania Condos, New Orleans

2025 Prytania Street Condos

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Metro New Orleans Condos, Its a Mixed Market and plenty currents….

When looking at the Metro New Orleans Condo market it is like a tail of two cities.  The Orleans Parish Market is very hot and the Jefferson Parish Market is still soft.  The prices in New Orleans are much much higher than in Jefferson. The West Bank condo market barely exist, but this is nothing new.  The demand is pushing prices up in New and there is not a lot of inventory for sale.

The rental market is softer in New Orleans than it has been in quite some time while the Jefferson rental market is doing very very well.  There are just more places to rent as sellers can afford to hang on to property as it goes up in price. Maybe we are getting close to a bubble….

Interest rates are going up steeply in the short term.  They went from 3.5% to 4.5% in the last 30 days.  One of the steepest upticks in years.  All because the Federal Reserve says they may not buy as much debt as they have been doing.  Its like borrowing form yourself.  Actually it is like printing money.

Its hard to see interest rates taking off again.  The USA is the largest borrower in the world.  They are borrowing a trillion a year.  The current debt stands at 16 trillion and quickly heading to 20 trillion in 2-3 years.  If the government has to pay 5% then their borrowing cost would be 5 x 20 trillion or a trillion per year. Then you would be borrowing a trillion and another trillion to pay the interest on the debt.  Not sure this makes a lot of sense unless you know math…..Just my Two Cents…

It hard to tell which door is going to open next.

 

Double doors in New Orleans Humidity

     We are seeing a lot of cash sales as people are not getting a great return on their money and they are so many uncertainties in the market.  We will see fewer and fewer refinances as rates rise and generally you need to get a rate 1.25% below your current rate to make it worth while. The older folks that used to be a big source of condo buyers is not there unless it is a second home.  This means they are staying put.

There are not a lot of young, young first time buyers either.  Not sure what the reason is for this.  It could be that the down payments need to be 10% to get the best rates.  Takes a while to save this on starting salaries these days…Loans are still tight and other loans are becoming a factor…The car note and student loans do add up decreasing a persons buying power.

Certain sellers have been coming up with “Dream Land Prices” that make no sense at all.  It gives agents a place to show while the price drops.  Other sellers price it right and it is gone is 10 days in most cases in New Orleans.  Much longer in Jefferson.

These are a lot of currents to think about.  Stay around another 30 days and things will change.  With that said June , 2013 has been one of my best sales months ever in 15 years of real estate. Five cash sales in a row may also be a record.  Which door is next….

New Orleans Double with triple Blues

 

 

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The Market for Second Homes in New Orleans is Sizzling….

     The Market for second homes in New Orleans is as good as I can ever remember it since I got into real estate in the late 1990’s.  There are few new projects on the drawing boards.  There have not been any foreclosures in the last two years as the rental market is tight and places are easy to rent.

    Oddly enough many of my clients for second homes live in Louisiana, Alabama and Mississippi.  Lafayette, Baton Rouge, Mobile and Jackson is the most common towns that they hail from.  This makes it even harder for people living further away as when something nice and priced right comes on the market it sells quickly.  We can get the people living close to come down and look at the condo  on day one.  This is much harder for people living further away.

     At one time the bulk of the second homes were centered in the French Quarter and along St. Charles Ave.  This has changed and people are focusing on the French Quarter, Warehouse District, Garden District, Lower Garden District, Uptown New Orleans and adjacent areas. In areas that never flooded from Katrina as they are in older areas of town that were built on higher ground.

    A sale that I have now sold the first day to one of my clients.  They lived in Baton Rouge and was able to introduce them to the market and look at the most likely spots where listings would come up.  We toured the complexes to give them some ideas.  I then sent them the past sales from 2012 to date so they could see what they would get.  I then set them up on a watch list to get the new listing each day that met their criteria.  I could then answer there questions about the condos and if they were priced correctly.  We did see a couple of overpriced units, but I knew they would come down in price as time moved on.

Girl Watching Fest 2

     Then when the right one came along they were ready to purchase and had a good idea of what to offer.   They were prepared to make an offer quickly.  They just happened to be cash buyers which makes it easier.  Borrowers will need to get their duck in a row and use a local lender by all means.  We have seen too many deals not make it in a timely manner from out of town lenders or large banks.  We are too happy to give you the best people that do deals in these locations all the time.

      That is the way it has had to be done for the quality places that people are looking for.  There will be more time if the place needs work, complex dated in need of repairs or is overpriced.  These units will tend to stay on the market longer.

The result of a successful search is to be patience and the right thing will come up. Many times we here about new listings from our agent friends so we can get our clients some advance notice.  It has helped me sell several listings  quickly after I had them listed.  It does help to be prepared and in the know as to what are going to be the future choices….

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The Cotton Mill Condos in the New Orleans Warehouse District, Still a Great Place to Live….

Cotton Mill Condos , New Orleans Warehouse District flags

      The Cotton Mill Condos in New Orleans Warehouse District is a great place to be.  It has a lot to offer purchasers in the under $200,000 price range.  It is one of the larger condo associations in New Orleans.  It has amenties like secure entrance with 24 hour personnel on duty, a giant courtyard, updated gym, pool, secure lobby and on site management.

     The 288 units offer a variety of styles and sizes.  The more popular things that people like are the larger windows, the exposed bricks, and the high ceiling with exposed beams.  This is the true warehouse feel in New Orleans.  The vast majority of the condos are one bedrooms but there are some great 2 bedrooms that come up for sale about every 3-4 months.

     One thing I do know after selling at least 30 of these condos is that you will instantly like or dislike them.  So its always worth taking a look to see if it fits your needs.  They are easy to rent and that makes them more popular today.  People will tend to rent their second homes for periods of time so this fits that purpose.  Owners are hanging on to their units for longer periods as they are easy to rent.

Cotton Mill Condos, New Orleans Warehouse District, Lobby

       In 2012 you have not had a large supply of condos for sale in a comeplex that has 288 units.  The demand is there for units that are priced correctly.  You can see from the data below that one bedroom are trading in a tight range.  The differences in price are just just size but the are the Updates, Views and floorplans.

     The two bedrooms are going to vary more than the one bedrooms as the floor plans vary much more.  Two bedroom condos are generally selling for more that are all on one level rather than the style where one bedroom is stacked on the other.  This year you just do not have a lot of sales in tow bedrooms.

  Cotton Mill Condos, Interior Condos facing courtyard

 Cotton Mill Condos, New Orleans Warehouse District, Old Boiler

Cotton Mill Active Listings, October 2012

     Currently there are only four units for sale at the Cotton Mill.  The #357 looks to be a fair buy at under 200k.  The Penthouse for $650,ooo is a one of a kind unit that has been totally redone with some great city views.  The #432 is also a nice unit that will not last lng on the market.  It is a total redo of a large two bedroom with over 1400 sq. of living area. I currently have Cotton Mill #352 under contract after about 3 weeks on the market.  Price it correctly and sell it quicker.

     See recent Blog on Cotton Mill Condos for under 200k, Best New Orleans Warehouse District Buy!!

Cotton Mill Sales since March 2012

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Eric Bouler Realtor
Gardner Realtors
Metairie - New Orleans, La. USA