[mja]

Originally Posted by CondoGuru

Yes and no. The fact that there were NOT rampant speculative buyers flooding Philadelphia was the reason why most of the past proposals never got built. And thank God for that! Philadelphia buyers are 90% users, meaning they buy real estate to occupy as their primary residence. Miami's problem was that the vast majority of its buyers were speculators for whom they overbuilt. Speculators are typically not committed buyers and are usually subrime candidates. The oversupply down there is due to these speculators not getting loan approvals, defaulting on their contracts, and losing their deposits. When the market couldn't absorb the oversupply, speculators couldn't flip their contracts. Most developers in Philly with the exception of Waterfront Square, never allowed reassignment of contracts in order to discourage that speculative investor from buying. Philadelphia has not seen any of this due to the demographic of its buyers. We're very conservative here and the psychology of buyers is completely different. It's entirely possible that Parkway 22 may very well happen, it's just not going to happen as soon as they claim. If the developer is totally committed and they get construction financing, it will rise. The cost of construction will only ever go up, so for a building slated to be completed in 2010 or more likely 2011, the market may be very different by then and will most certainly be on an upswing, making a new building like this more desirable. But if they undersell their units, getting financing will be tough, unless they dramatically raise their prices to cover the units they undersold. Putting down 10% or even 20% for a $369,000 unit that you won't have to close on until 2010 or 2011 is a no brainer. I just don't see how it can happen at such low numbers.

The developer has owned this property for a very long time. The parcel cost them basically nothing. Perhaps this is why the price point is lower than some other projects?