watch craigslist and see how the number rises daily for rentals at the live2200 complex. There are 19 as of last count. over all…I have seen maybe 3 of those advertised rented in the last month. Plenty for sale also and they haven’t even finished them all out yet…so…many more to come online.

Attempting to rent a 500,000 1br condo for 1750-2000 per month is a losing prospect and a stupid investment at best…whether it financed without a $ out of pocket…or purchased for cash.

The flippers turned landlords will now have two choices.

1..Lose it slowly over a period of time by renting it out…all while hoping there aren’t any periods of vacancy (yeah…sure)…and also hoping that whoever rents it doesn’t take an “oh well…it’s a rental” attitude.

2…Accept the fact that they purchased at the wrong time and sell for the loss that will only get bigger as time goes by, more money is paid in interest costs, and even more buildings come on the market creating an even larger inventory glut. Not to mention the opportunity costs of not having the capital to actually invest in *profitable* investments being that they are waiting and waiting…hoping to get some kind of profit.

It’s not gonna happen.

No…the jobs that are being created do not support the prices of places such as Olive8, Madison Tower, Cosmopolitan, Gallery, Lumen, CedarSt et al…so…more power to the realtor that is able to bring the ugly truth to their clients when they choose to sell their ball and chain of a condo in Seattle.

Realtors shouldn’t be telling buyers to buy because it’s a “buyers” market now…they should be telling sellers to take the money and run because it is only going to become more of a buyers market…anybody that thinks otherwise should take a few economics courses.

I’ve got some clients also impacted by the delays in the Vulcan developments and we’re not that shocked. It’s pretty rare to see one of these projects actually finish on time plus we’re getting hit with labor shortages in construction, delays of some vendors completing their work (eg. elevator installers) and more.

I’m not shocked that more units are on the market for sale and that more are coming up for rent. The good news is sthat we’re back into a landlord’s market on rentals in Seattle and many other local areas so at least these folks may be able to get close to cash flow. Some of these purchasers likely bought for rental purposes anyway – most of the developers have allowed up to 20% for these purposes so don’t be shocked if some folks take advantage of it. Considering more condos than apartments are being built at least these owners are helping to increase the supply of rental housing which is strongly lacking with all of the condo conversions that occurred in the past few years as well.

The ones I get most nervous about are the ones where the buyers initially lied about their loans and whether or not they were buying as primary residence or for investment. Those folks are the ones commiting fraud. They better hope their lenders don’t figure that out.

I say this because I believe that the sales team for the above mentioned are John L Scott representatives & some mix of Vulcan staff, while the 2200 team is a team from Urban Realty – dedicated only (?) to the 2200 Westlake.