As the 2008 condo market continues to unfold, one thing is for sure, skittish would-be buyers will remain renters for the time being. That one fact has multi-family developers seeing green, as in higher retention rates for their condo dwellers.
Rich Cavenaugh, president of Chicago-based Fifield Companies, a multi-family developer, comments to MultiHousingNews.com that renters are looking for stability in their home life, but want an ownership feel to their rental. "For more and more people, the rent-vs.-buy debate will be pretty simple, and they'll opt to rent for a longer period of time," he says. "Thus rental developments will see higher resident retention rates and, with that, an increased demand for developers to create lifestyle choices and a sense of place."
Another high-rise developer in the Chicago area agrees. John Eifler of Marquette Companies says the new apartment development will be competing with condos on the market. "Since the pool, fitness center and club house are exclusive amenities, residents know each person they meet will be a neighbor," he says. "Beyond the clubhouse, we've updated the apartments to a level today's renters would find in for-sale condos."
These developers' sentiments seem to coincide with the National Association of Home Builders confidence survey released last week, showing builders' low confidence in condo development through 2009. NAHB Chief Economist David Seiders said in a release on the group's website , "Given that the condo market became so overheated during the peak of the housing boom, it is not surprising that the market now continues to struggle, considering the difficulties in the mortgage sector and the fears about the economy in general," noting that it's going to take time for the extra inventory to be absorbed.