» Subscribe Today!
The Power of Information
Home
The Ledger - EST. 1978 - Nashville Edition
X
Skip Navigation LinksHome > Article
VOL. 38 | NO. 25 | Friday, June 20, 2014

Finding a college condo like a course in futility

Print | Front Page | Email this story

The summer of 2014 may go down in the real estate annals as the most difficult time in the city’s history for a person to purchase residential real estate.

Under normal conditions in this area, from 1987 through 2006, even with the hot market prior to the Great Recession, buyers were able to view a number of homes and choose from those choices.

A typical real estate transaction included a romp through a neighborhood or two to introduce the buyers to the market, allowing the buyers to decide the locale of their future domiciles.

Once their searches were honed, the buyers would visit 10 to 12 homes and cull the list to four or five favorites. A few days later, the buyers, now accompanied by spouses or others involved in the decision, would choose the homes that would make it to the final round.

The winner was chosen in yet a fourth round of the tours in a matter of days.

Buyers usually felt comfortable with the process and were content with their decisions. That is not the case in this market.

Now, price dictates the location, and the listing prices sometimes astonish buyers to the point of nausea, especially buyers moving from depressed areas, rural communities or Americana in general.

Prior to the Great Recession, it was commonplace for parents of students to purchase hoouses/condos for their children, especially Vanderbilt parents.

In the 1980s and 1990s, a condo could be purchased for $125,000 during a freshman year that would sell for $160,000 after graduation, a profit that paid approximately a year’s tuition at the time.

In many cases, the student incorporated a roommate into the model and used the rent as spending money. So, the parent doled out the cash for the purchase and did not have to worry about funding the children’s meals, transportation or any miscellaneous expenses, and then received a rebate of one year’s tuition after the student’s stay.

During the recession, with cash entering the endangered species list and consumer confidence in real estate a memory, those transactions evaporated.

Now, the parents are back with borrowing ability again, many laden with cash. Unlike the parental buyer of old, the modern-day buyers have children scattered across area colleges with buyers from Belmont, Lipscomb, TSU, MTSU, Meharry and others.

Many boast the proud parent stagger – until they get a load of the prices.

For $125,000, they are headed to a place that, based on recent history, may or may not appreciate, will require a long commute to most of the colleges and definitely will not pay a year’s tuition after four years, even with the market on the upswing.

And the process has changed.

Once the price point rules out many areas, parents settle on an area that is in third or fourth place, based location and living space, or reworked their budgets, often doubling the acquisition costs.

On a positive side, the roommates now pay exorbitant rents that could fund more than miscellaneous expenses.

In the past, the parents could knock out this piece of the children’s residential puzzle in a matter of days. Today, these and all buyers are trudging through the muck of leftover properties that were not devoured by the gaggle of buyers over every new listing.

They must determine the area, the parameters of the homes and buy a property in need of work, or await the perfect property, entrust the Realtor to monitor all new listings and have a stand-by airline ticket to swoop into town with checkbooks blazing.

Sale of the Week

This week’s sale is a ranch-style home located at 500 Hogan Road in Crieve Hall.

This 2,000-square-foot, renovated, three-bedroom, two-bathroom home sold for $327,500 in 68 days from listing to closing.

Listed by Andrew Trammel of Benchmark Realty for $345,000, the home was renovated in the fashion of most of the successful sales of this fast-paced era, with glistening hardwoods throughout, a modern day kitchen with the mandatory stainless steel appliances and granite countertops, and eye-poppingly-bright fresh paint applied across the walls and ceilings.

The bathrooms in the master suite were reworked with new tile smiling from floor to three quarters of the way up the ceiling around the new bath tub, shower and double vanities.

The backyard living area includes a covered deck along with a patio.

The Crieve Hall area offers all of this for $163.75 per square foot with a price of less than $350,000. Crieve Hall is located east of Interstate 65 at the Harding Place exit along Trousdale.

Richard Courtney is affiliated with Christianson, Patterson, Courtney and Associates and can be reached at Richard@richardcourtney.com.

Follow us on Facebook, Twitter & RSS:
Sign-Up For Our FREE email edition
Get the news first with our free weekly email
Name
Email  
TNLedger.com Knoxville Editon
RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 0 0 0
MORTGAGES 0 0 0
FORECLOSURE NOTICES 0 0 0
BUILDING PERMITS 0 0 0
BANKRUPTCIES 0 0 0
BUSINESS LICENSES 0 0 0
UTILITY CONNECTIONS 0 0 0
MARRIAGE LICENSES 0 0 0