Rent or Buy? The Regatta at 420 E. Waterside Drive
Should you rent or should you buy in this market?
The Regatta at 420 E. Waterside Drive in LakeShore East is one of the new highrises in the “new east side”. It started closings in early 2006 so it has already been dealing with flippers and a rash of renters.
Building statistics out of 321 units:
- 19 for sale
- At least 14 for rent
There are some interesting units for sale or for rent. We can see the direct comparison.
Unit #2804 is a 788 square foot 1 bedroom unit available to buy or rent. I don’t have pictures of it but below are pictures of Unit #2304 which is also available for sale and should be the same layout. Both units are 788 square feet. Unit #2304 is listed for $399,000 plus $45,000 for parking.
Unit #2804: 1 bedroom, 1 bath, 788 square feet
- Sold in June 2007 for $445,000 (included the parking)
- Currently listed for $488,000 (includes the parking)
- Assessment of $264 a month
Or, you can rent the same unit for:
- $1,500 a month
From the listing:
PARKING SPACE P-292 INCLUDED IN PRICE. ASSESSMENT PREPAID TILL JUNE, 2008. EXISTING TENANT WILLING TO DO 1 YEAR LEASE AT $1500 PER MONTH.
Or, if you want more space, you can look into this 3 bedroom unit.
Unit #4114: 3 bedroom, 3 bath, probably around 1880 square feet
- Currently listed for $1,250,000
- Assessment of $661 a month
- Prudential Preferred has the listing
Or you can rent it for:
- $5,500 a month
You can see the discrepancy in the rents between the units as well. Some owners are trying to cover their costs with the rent and others are not. Unit #1208 is a 2 bedroom, 2 bath unit with 1488 square feet. They are asking $5,500 a month.
Hm…a 3 bedroom high floor unit for $5,500 or a low floor smaller unit for $5,500?
a bit off topic…..but this website may interest people.
http://www.feedisclosure.com
it gives an estimate of the third-party fees that you pay when buying/selling a house, which can total about 1% of transaction price.
Great post Sabrina! Renting is much cheaper than buying these units.
By my count, there are currently 12 active listings by flippers and 2 pending sales. In addition, 14 units have been flipped with most occuring late 2006 and the first half of 2007. The early flips got out with some gains, but those still on the market seem to be all facing losses when considering carrying and sales costs (if they can find a fool.) I also noticed additional units which have been pulled from the market when wish prices have not been met. I guess their denial is somehow masked by large monthly outflows of cash. There is bleeding all over this building and it is only a matter of time before it is evident from the street.
This building will help define the timeline for the demise of flippers. The new fool requirement is no longer being met, which only leaves the last fools holding the bag.
G: Yes, from what I could find there were definitely a few successful flips in the building but even back in late 2006 and early 2007 they were having difficulties getting their asking prices.
Most of the flippers have simply rented out the unit. A tipster sent me some info that indicated that about 30% of the building is actually rented out (nearly 100 units.)
I guess that makes it a pretty fancy subsidized rental building, doesn’t it? At least it is the “investors” doing the subsidizing, and not our tax dollars.
Come to think of it, I have always heard that it is subsidies that help to drive up housing prices. This seems to be happening in the opposite direction. Leave it to the flippers to turn more fundamentals upside-down!
I have been renting since arriving here from the S.F. Bay Area, and although this Spring may not be the best time to buy, I would like a place that I can “make my own”. I am interested in Lake Shore East and this building in particular, as it is near my office. Would I be able to get a 2 bd on a lower floor in this project for around $500,000? I am renting a 2bd nearby for 2175, and have a lease that expires in June.
Would some of you advise buying in a newer building like this, or fixing up an older unit in one of the towers nearby? OR should I rent one of these units and hold on for another year?
Hi anonconfused,
Please post your email or send Sabrina an email (contact me on home page) and I will run some searches for you.
Hey anonconfused,
I have actually been tracking a 1250 sq ft 2/2 in the Lancaster (newer building in Lakeshore East) that is under 500K.
Anonconfused: I guess it depends on how long you intend to live in the condo. Do you believe you’ll live there for at least 5 years (and maybe longer)? Then it might make some sense for you to buy.
If not, then it probably makes more sense to rent (financially at least.) There are, of course, emotional reasons to buy as well.
There are some units coming on the market at lower prices but this year will be critical. There will be lots of foreclosures and lots of inventory- which to me means that prices will come down.
Anyone else with any advice?
Sabrina, I love your website – it is so informative for a prospective first-time homebuyer like me. After reading this blog for a few months, I’ve decided to wait up to a year to see where the market goes. For the time being, I’m looking for a condo rental and need some help. How did you find the 14 rentals in the Regatta — or any condo building? I found only a few listings on Craigslist, mostly generalized “building” listings by brokers. How do I find the specific “unit” listings for a building? Thanks so much!
Hi Helen,
Most of these listings are found on the MLS. Please let Sabrina know if you would like me to send you some units to review online. I would just need to know your preferences in terms of location, number of bedrooms/bathrooms, and parking.
cribchatter@yahoo.com
I would agree with all above, and I hear that lawsuits against the developer are accumulating from the Chandler and Regatta, both projects of Magellan Development. Apparently the Lancaster threatened to sue Magellan Development also but they settled. At the Ripoffreports web site there are a couple of complaints against Magellan Development and the LakeShore East Development, with everyone advising against preconstruction buying. I guess if you know what you’re buying post-construction it’s OK, but anyone buying into Aqua or the Park Homes now had better be prepared to be misled or deceived by the Magellan sales offices. Neweastside website also had issues noted with suits made against Magellan.
Interesting reading above. The information is somewhat concerning. I’m in the process of purchasing a unit in the Regatta. What is the status of the lawsuits with Magellan? Also, I am a bit more concerned onwhat the market will do in the next 5-7 years. I have some knowledge of the closing purchase price of the previous buyer. Have selling prices fallen BELOW original preconstruction prices? If so, what should I be asking for? I am looking to purchase and LIVE in the unit with no plans to sell for > five years. Any information on making a soud purchase whould be appreciated. Thanks.
Tony: You are hitting on all the issues right now. The market continues to decline- so that’s a chance you take when you purchase right now.
As for selling prices- they are all over the place.
Sabrina,
Thanks for your input. There are a lot of people desperate to sell and prices seem to be at preconstruction prices. When you say the prices are all over the place, can you be more specific? Based on what you have seen what would be a reasonable selling price for the 3 bedroom units (3014, 3614, 4114)? thanks again.
hey guys….i wanna invest in a place now cause the prices are low…iv a few questions and and a few options in dug out…please help wherever u can..
should i buy now? some people say the prices wont fall anymore and some say they will further decline…
should i look at the best deal or stay in a certain range..meaning if i can get a 2 million dollar penthouse for 1.3 or a 750k 3 bedroom for 600k,which one is advisable…meaning shud i be willing to put in around a million in this market if the price is really gud?
now these are the options i have come across…
(please keep in mind that i have around 600k cash)..
1. a unit in skybridge 737 west washington for 680k..01 tier..3 bedroom. 3 bath.2400 sq feet approx..2 parking spaces…some of the similar units have sold for around one million a few years back..
2. 757 orleans….2 bedroom 2 bath…around 1300 sq feet…beautifull view..450k..with one parking maybe!
3. 420 east waterside..penthouse…830k..2000 sq feet..3 bed 3 bath..floor in the 40’s…facing lake..
4. 2 bed 2 bath in skybridge for 400k with parking..around 1600 sq feet..
all of these are on the 20th floor or above..so all have real gud views…i wudnt buy anything in downtown with out a view..dont c the point..
please rate these properties if u can and inform me if anyone knows of any gud deals that suit my profile..
thank u