Condo Developer Hopes To Drive Sale With Incentive
Everywhere you turn there are incentives to entice home-buying there's the $8,000 first-time homebuyer tax credit, for instance. Some realtors tout the low interest rates. But some local condo sellers are getting very creative to drive home a sale.
If you drive up Grandview Avenue very often, you've likely noticed the signs on the side of The Heights condominium building: buy a condo, get a car and trade in your house.
"We're open to pretty much anything," Kolby Turnock said.
Turnock is a sales and planning manager for Stage Capital, the parent company of The Heights of Grandview.
The condos, which are situated on the corner of Grandview and Third Avenues, have been there for four years. They are listed for $500,000. And six of the 20 units are still vacant. Turnock said Stage Capital came on board about a year ago to try to get them sold.
"The market has been tough, especially with condos. We've always had a lot of traffic through the building and a lot of interest. So we just felt if there was something a little extra to incentivize someone to make the purchase anything could help," he said.
Turnock says car incentives are more common in large cities and upscale condo units. At The Heights you can get a BMW 328 lease for three years- if you buy one of the two most expensive units. You can trade in your old house if it meets the developer's standards. And if those don't entice you, they also offer developer financing for two years. He said the incentives are basically negotiating tools for buyers.
"And our last three sales in the past three months have been pretty much self-incentives that the people wanted. And we were able to work with them and get what they needed," Turnock said.
Turnock said often times potential buyers will ask for condo fees to be paid for a certain number of months.
The Heights is not the only group offering incentives. Lifestyle Communities is, too. Russell Boiarsky is their Marketing Director. He says Lifestyle Communities is offering an incentive called "The Perfect Match" where they're matching the $8,000 first-time homebuyer tax credit.
"Our motivation was to, was to really try and move the needle a little bit to get people back out there," he said.
It won't be cash. Boiarsky said the buyer can get $8,000 knocked off the price or get $8,000 in upgrades to the condo. He said this is a better incentive than say a car.
"If you offer then $8,000 off the cost of their home, or $8,000 value to their home, it's something they're going to realize when they go to sell the home. So it maintains itself through the life of the home," Boiarsky said.
Columbus board of Realtors president Sue Lusk-Gleich, said while the BMW incentive is unique, other perks are becoming increasingly common.
"Just some incentive to bring the buyer there," she said.
There are a lot of condos on the market- more than 3,300. And condo sales are down 7 percent over the past year.
"We're seeing more foreclosures in the condominium market than we were in the single family market. I mean, rules have changed in the single family market as well, but condominiums have really been hit hard," she said.
Before, Lusk-Gleich said, buyers could get away with putting down five percent on a condo and with the exception of some community banks, lenders, like the FHA, now require 20 percent or more of the home price.
While prices had decreased for a while, Lusk-Gleich said they're beginning to level out. And she said sellers are doing what they can to get people interested.
"I think it gives them the extra incentive. I mean, if you think about it, the $8,000 credit was enough to bring people into the marketplace. So if you're throwing other things in it could potentially seal the deal," Lusk-Gleich said.
So far in Grandview, no one has taken the BMW...one person traded in their home for a condo at The Heights. Boiarsky, with Lifestyle Communities, would not say how many buyers, if any, took advantage of the tax credit match.