Friday, January 25, 2008

Is condo bust good for some 'hoods?

In my neighborhood of Rogers Park, the recent condo boom transformed whole blocks of formerly affordable (and often run-down) apartment buildings. A survey by Lakefront CDC counted 3,600 condo units created or converted since 2003, and my own walks around the neighborhood suggest the long-term numbers are much higher.

Is this a good thing? For Rogers Park and other hot 'hoods -- Logan Square, Humboldt Park, Pilsen, Albany Park -- the gut renovations and Euro kitchens will extend the lives of hundreds of courtyard buildings, six-flats and corner buildings. With millions invested by developers, and shops and restaurants following the money into the neighborhoods, these areas have a good shot at long-term stability.

That's mostly good, especially if the alternative is losing buildings to decay and demolition.

But thousands of renters have had to move -- and not just down the block, because those buildings are turning too. Next door on Pratt Avenue, we watched two corner buildings shift from rental to condo with 100 percent displacement. Down the block, condos took over a 60-unit string of courtyards that had been well-kept and affordable for decades -- housing many families who sent kids to nearby Kilmer School. The new occupants are noticeably younger, richer and whiter.

Not such a good thing. Which is why I've been heartened to see that the condo market is collapsing -- witness the auctions and extended sales periods -- and that in Rogers Park, at least, some buildings are being renovated for rental, not sale. One building at Pratt and Sheridan has all the characteristics of a condo conversion, from balconies to duplex units, but the sign says "Now renting."

Of course rents will be higher on the renovated buildings, but the slowdown in conversions means Rogers Park, and other places, can take a breather. Kids can stay in the school they've been attending, families can avoid the disruption of finding a new neighborhood, and the diversity that makes such neighborhoods interesting and healthy can be sustained and nurtured for a few more years.

good, no question about it.


Anonymous said...

What I'm supposed to feel bad for buying a condo?

Patrick Barry said...

You should feel good about buying a condo -- and about getting involved in your new neighborhood. But what I think long-time residents of these neighborhoods would appreciate from new condo owners is a willingness to learn about and respect the community that was there before the condo conversions took place. A small percentage of newcomers, unfortunately, want to remake the neighborhood into something radically different than what it has been. And that can rub us old-timers the wrong way.

johnk43 said...

I don't think how condo owners feel is the issue, but how the condo wave has subtly transformed Northeast Chicago and what this bodes for the future is. I think Patrick presents a balanced picture, but there's more to the picture. Condos are a bonanza for real estate agents. They turn over constantly; at least they did until the recent downturn. A building behind my house always has a for sale sign in front of it. Apartment buildings sell much more slowly, and nonprofit affordable doesn’t represent a market for real estate agents at all.
They also mean more cars. I live in a neighborhood, like most of NE Chicago, of extremely varied housing stock: One block of single family homes, the next block of multifamily apartment buildings (now 90% condo buildings). There was always tension with the Apartment dwellers parking in front of the single families. (Garage owning single family dwellers feel they own the street after all.) But after the condo conversion waive there's no more parking on the block after 8:00 PM. Condo dwellers may have more cars, but they have fewer kids. Condo owners have more cars to park than low and middle income apartment dwellers. However, schools that were recently overcrowded now have empty desks.

What does the future hold? As the resale market goes flat, more condo associations may change their by-laws and allow renting so owners can get married and move to the suburbs, and form the new absentee owner class. So maybe the buildings will shift back to renters. And as neighborhoods closer to the loop loose value, will condo/housing in Northeast Chicago be even less desirable? Maybe working class families will be able to live in the neighborhood again? Or will rents for units with granite countertops and four nozzle showers still be out of reach? But I imagine that condo owners, anxious about maintaining the sale ability of there threaten condo investment will lobby against any form of affordable housing. The real estate market and community development. Sometimes work real well together, as Patrick points out -- condo conversion has saved and refreshed old buildings created a market for blocks of restaurants and shops (such as Andersonville) and brought new residents. But it is always changing But in the end will spitting up a multifamily building with one absentee owner into a multi unit commodity/profit center for developers, real estate agents and owners who thought their condo investment would always appreciate, really create stable neighborhoods for the long term? We'll see