Downtown Silver Spring. Photo by faceless b.
Now that there are signs of life in the new condo market, prospective buyers are wondering what DC-area neighborhoods developers will pick for new projects. Unfortunately for those with their eye on Downtown Silver Spring, that area is probably low on the list.
Five condo projects delivered in Downtown Silver Spring during the condo boom from 2003 to 2006: The Aurora, The Crescent, The Silverton, 8045 Newell Street, and Mica Condominiums. All of those were new buildings save Mica, which was built as apartments in the 1970s then converted to condos in 2006.
The problem with the Downtown Silver Spring market now is that a large percentage of the recent condo sales are distressed properties, Mark Franceski, director of market research at real estate sales and marketing firm McWilliams|Ballard, told UrbanTurf. There have been 41 condo sales across those five buildings since the beginning of last year, and 19 of them were either foreclosures or short sales. As of last week, there were nine foreclosures and short sales on the market.
All that distressed activity has driven down average prices to around $275 per square foot. During the boom, the same condos were selling for $400 per square foot, which is the price range developers would look for now to justify starting a new project, according to Franceski. So prices would have to come up markedly before developers consider new projects in the area.
The silver lining for a would-be condo buyer in Downtown Silver Spring is that now could be a good time to buy, especially for those willing to endure the unpredictable process of buying a foreclosure or short sale. The inventory of distressed properties in the area could be absorbed in the next six to twelve months, after which presumably pricing will start to firm up and potentially increase.
For more UrbanTurf coverage of Downtown Silver Spring see:
- Downtown Silver Spring: Experiencing a Resurgence After a Bumpy History
- New Silver Spring Apartment Project to Break Ground Soon
This article originally published at http://dc.urbanturf.com/articles/blog/dont_expect_new_condos_in_downtown_silver_spring_anytime_soon/3177
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