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As Home Building Slows and Land Prices Soar, More Developers Turning to Condos, Townhomes and High Rises
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0 Comments ::  :: REAL ESTATE |
Every real estate developer’s goal in life is to buy a piece of property and develop it at a profit. But what is a developer to do when land prices and availability become cost prohibitive?
The answer is more units per acre to offset rising land prices. It’s not rocket science it’s a hard economic fact. With the average price of a home in McAllen in the mid $120’s developers must sharpen their pencils and use their expertise to make a profit. Condos Townhomes and High Rises are filling the bill for many.
In an article by Kyle Arnold of The Monitor several important facts are highlighted:
1) A glut of vacant housing lots and a dwindling interest in new homes are leading many McAllen developers to look into a new direction - condos and townhouses.
2) In a region where a new home can cost as little as $80,000, developers across the Upper Rio Grande Valley are turning to community dwellings to target young professionals, retirees and Mexican nationals.
3) Land is getting very, very expensive and people prefer to live closer to shopping, jobs and a hospital.
4) Several new condominium projects, mostly in McAllen, are expected to add hundreds of new units to the area during the next 18 months. Developers plan to break ground this month on a $16 million high-end condo project in South McAllen and another group is planning a high-rise tower in Edinburg near Expressway 281. Condos, Townhomes and High Rises are plentiful In Galveston, South Padre, and the other areas along the Texas coast. They will be a new experience for the valley.
Let’s look at some of the benefits they have over single family houses:
1) Amenities- With a lot of residents chipping in through association fees it is easier to afford amenities one could not afford at his own house. Swimming pools, tennis courts, hot tubs, club houses are the norm at most projects.
2) Maintenance- Do you really want to mow the lawn or pay someone else to do it? Many Mexican National homeowners don’t want to fool with maintenance issues while in town. Most condo/townhomes are beautifully landscaped and maintained by the association through fees equally spread among all the owners.
3) Rentals- Condos and Townhomes are better risks for rental income due to their cost, location and maintenance.
4) Location- With the high cost of land in the City of McAllen for many a single family home is just plain too high priced and with the cost of fuel trips back and forth from the suburbs just too expensive. Condos and Townhomes offer better more convenient locations for less money.
Several condo projects are planned for the McAllen area. Several new condominium projects, mostly in McAllen, are expected to add hundreds of new units to the area during the next 18 months. Developers plan to break ground this month on a $16 million high-end condo project in South McAllen and another group is planning a high-rise tower in Edinburg near Expressway 281.
One group expects to complete 37 town homes this year and they are calling the project Barrio Antiguo. Will the townhomes, condos and high rises succeed?
Condos are a big hit on the Texas Coast
One can look at the Texas Coast and see the answer is yes. In Galveston Palisade Palms, Diamond Beach Resort and Spa, and Emerald By The Sea are selling briskly. The developers have dealt with the high priced of coastal land by building high rises and mid rises. In fact the majority of Galveston’s real estate sales are in these three amenities laden projects.
The likely hood of appreciation well above the Texas average has drawn worldwide purchasers along with Mexican nationals to these mega developments. Because of the amenities, appreciation and the weakened US dollar, many see these as solid investments that will carry an edge against inflation and protect their assets.
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Grandly presiding over the west end of the Seawall, Diamond Beach Resort & Spa features Galveston’s only private white sand beach.
This newest addition to the Randall Davis Beach Collection is the only ocean front property protected by the Seawall, bringing the beach to your front door. Enjoy beachfront living with none of the hassels.
Diamond Beach Resort and Spa is attracting buyers with a pre-construction sale available only to the first thirty buyers, so those with interest would be well advised to make inquires about the resort right now and strike while the iron is hot.
The 30 units won’t last long. Pre-construction purchasers at Palisade Palms did quite well on their investment and there is no reason to think early bird purchasers at Diamond Resort will be any different. It being a project by world famous Houston Developer Randal Davis. |
Further down the coast at South Padre Island another Randall Davis development, The Sapphire, is a blazing success as it glimmers in the morning sun.
Ocean Tower on South Padre Island is likewise garnering much attention.
If Condos like these are doing so well on the Texas Coast, will they also do well in the Mcallen area?
Build them and they will come seems to be the message for McAllen and the valley, an area lacking in townhomes, condos and high rises. One thing is for certain, when the price of prime location real estate sky rockets, developers have little choice but to concentrate on high rise, townhomes and condos. When the price of land pushes the price of a single family home way over affordability these projects just make more and more sense.
McAllen has townhouse and condos in its future and you can take that prediction to the bank! |
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