Townhome Trend

[roadrunner]

I wasn't sure which forum to post this in, but Real Estate seemed the most fitting.

The Loop has been experiencing a townhome boom over the last 5 years or so. Is this something unique to Houston? I lived around Alamo Heights in San Antonio for the last 4 years (sort of equivalent to inside the loop), and I did not notice the same townhome buildup that Houston is experiencing. Is it happening in Dallas? Austin? Fort Worth? the rest of the country?

Edited January 17, 2008 by roadrunner

[sowanome]

I wasn't sure which forum to post this in, but Real Estate seemed the most fitting.

The Loop has been experiencing a townhome boom over the last 5 years or so. Is this something unique to Houston? I lived around Alamo Heights in San Antonio for the last 4 years (sort of equivalent to inside the loop), and I did not notice the same townhome buildup that Houston is experiencing. Is it happening in Dallas? Austin? Fort Worth? the rest of the country?

I can only speak for Chicago and another few midwestern cities in saying that Houston is behind and once this trend is done, then you will likely see more mid/high rise condo projects because of the lack of land. For example, 5 to 7 years ago in houstons inner loop you could easily purchase a two/three level townhome with a private backyard and driveway for less than $275K. Now, obtaining a private backyard and an unshared driveway is likely to cost you more than $400k easily.....Look at how many townhomes are being bought and sold for more than $400k without a private yard or driveway! It's all about location, location, location and this is also why developers have developed the 4th floor terraces with an outdoor kitchen, etc.. If you can't build up...Build out!! Think about the eastern cities rather than the western cities when you question the townhome trend and you will see that out east and throughout the midwest, the townhome trend is a very old tradition built with all brick instead of Stucco.

[crunchtastic]

I just returned from a week in the Nashville area and the shiny flat roofs are still popping up there, too. Pricing, from what I could tell in the papers and the signs, seems consistent with Houston, actually. The high end isn't as high, but the low was about right. Even further out of town, there were some still going up in the 190-200K range--surprising to me, since 20 minutes out of downtown NashVegas is a world apart from suburban Houston. Those people really like their space between them and the neighbors.

[ToryGattis]

I think traditional single-family-home residential zoning in most cities would prevent the types of townhome projects we see in unzoned Houston, where an old, small house without deed restrictions can be demolished and replaced with 3+ tall, thin townhomes.

[Scott08]

I think traditional single-family-home residential zoning in most cities would prevent the types of townhome projects we see in unzoned Houston, where an old, small house without deed restrictions can be demolished and replaced with 3+ tall, thin townhomes.

Close to home, Austin and Dallas seem to have more mid and high rise multi-family projects in their inner cities than the townhouses in Houston. Less of them, but denser. I'm kind of torn about them. I hate to see perfectly good cottages in old neighborhoods mowed down to put up multiple townhouses, and yet I understand the need for more density, and the desire for homebuyers for more room and more modern amenities. In the last few months while I've been considering my moving options, I've toured some newer townhouses that were stunningly beautiful, I've also been in some that are the very definition of style over substance. Poor construction seems to be rampant in this segment too regardless of the asking price.

[plumber2]

The thing I don't like about townhome construction on small lots in older neighborhoods is that it leaves no room for off-street parking. The curb cuts are so close together that the only place for a visitor to park is in front of a nearby original home that still has a full lot. Not fair if you ask me. I prefer the type of townhome construction that has driveways in the rear, or grouped together between them.

[musicman]

The thing I don't like about townhome construction on small lots in older neighborhoods is that it leaves no room for off-street parking.

this is becoming more common. i know some friends that live on hawthorne (near dunlavy) and they are quite frequently pissed because the street parking is populated with customers of the shops on westheimer. it'll be interesting to see whether resident permit parking will become the norm in areas like this.

Edited January 27, 2008 by musicman

[TheNiche]

I wasn't sure which forum to post this in, but Real Estate seemed the most fitting.

The Loop has been experiencing a townhome boom over the last 5 years or so. Is this something unique to Houston? I lived around Alamo Heights in San Antonio for the last 4 years (sort of equivalent to inside the loop), and I did not notice the same townhome buildup that Houston is experiencing. Is it happening in Dallas? Austin? Fort Worth? the rest of the country?

It's happening to a limited extent in Austin, but basically only when they can replace a vacant or commercial property with two or three dozen townhome units at a time. Single-family homeowners have ridiculous levels of political power in Austin; NIMBYism runs rampant.

Can't speak to Dallas or Fort Worth. I suspect that if San Antonio lags in the trend, it may be more of a demographic/income issue than anything else. Quantitatively, SA also doesn't have as many edgy new multifamily projects coming out of the ground as the other cities.

[rapturematt]

Let's just be thankful that we are not doing what they are doing in the east coast states and doing condo conversions with old apartment complexes that really should be torn down for better built structures.

[TheNiche]

Let's just be thankful that we are not doing what they are doing in the east coast states and doing condo conversions with old apartment complexes that really should be torn down for better built structures.

That trend has a lot to do with regulation. The barriers to (re)entry are often so high that the only thing that makes economic sense is to rennovate existing complexes; whether they're then marketed as for-sale or for-rent has a lot to do with prevailing macroeconomic factors, but the physical result is the same.

I can only think of a couple cases of condo conversion in Houston, and they were both somewhat newer complexes near the TMC, where it might've actually made a lick of sense.

[jscarbor]

The thing I don't like about townhome construction on small lots in older neighborhoods is that it leaves no room for off-street parking. The curb cuts are so close together that the only place for a visitor to park is in front of a nearby original home that still has a full lot. Not fair if you ask me. I prefer the type of townhome construction that has driveways in the rear, or grouped together between them.

You know I noticed this to when I lived in the montrose area but it wasn't the townhomes that were needing the extra parking it was the little cottage house with a garage apartment or the duplex with 1 driveway that was creating the need for all the parking on the street. The townhomes actually help IMO because you can park 2-4 cars at 1 house where some of these older homes park 1 car in driveway and have 2 more in the street. Just an observation I had when I lived in the area.

Back on subject I remember seeing some townhome construction in Chicago when I was there last on the west side. of course there was a lot of townhome/brownstone built in the early part of the 20th century?

[bostonhater]

I wasn't sure which forum to post this in, but Real Estate seemed the most fitting.

The Loop has been experiencing a townhome boom over the last 5 years or so. Is this something unique to Houston? I lived around Alamo Heights in San Antonio for the last 4 years (sort of equivalent to inside the loop), and I did not notice the same townhome buildup that Houston is experiencing. Is it happening in Dallas? Austin? Fort Worth? the rest of the country?

Dunno about other places but Houston inner loop sure does have a boom going on. Just went there today to check out to see the construction between Memorial Park and Allen Parkway. It is just unbelievable.

I have seen so many houses being built and at the same time you can see cars, SUV's stopping and questioning the Mexican labourers as to how much or when is it gonna finish.

What striked me the most is the fact that you see 400K townhouses with beautiful model-like women sitting in their patios chatting on the cellphone and on the next lot there is a slum with dogs running around and their yard looks like a junkyard. Oh and the house looks older than Tom Sawyer's hut.

I am dying to see the same area in 5 years again. But before that, I need to grab something out there. If not then the 5th ward. I don't want to miss the train this time.

[sifuwong]

This townhome trend is going on in downtown San Diego also. Actually, more midrise than anything.

[bpe3]

Just to clarify, the latest townhouse trend has been going on for 15 years. It started in earnest in the early 90's and hasn't stopped. As stated above, the trend is largely unique to Houston due to non-existent or expired deed restrictions in many older, well located, neighborhoods combined with our lack of zoning. In Austin, Dallas, or just about anywhere else, you just falt out can't bulldoze a 1,200 SF cottage on a 5,000 SF lot and build two new 3-story townhouses with a combined 6,000 SF of living space and two 2-car garages.

Houston is WAY ahead of the curve in allowing this type of development. You can't do it all with mid-rise and high-rise condos like they are trying to do in Austin. Most of the close-in housing stock in Austin is woefully obsolete. The powers that be in Austin prefer to just let it sit and rot in place.

A perfect example of this is Austin's West Campus neighborhood. This is some of the most valuable real estate in the city. There were some condos build there in the 80's, but nothing else for 20 years. The city's zoning limited the height of buildings to 3-4 stories. Developers couldn't build high. Land cost were effectively capped. Landlord's enjoyed receiving top dollar for decrepit 50-year old buildings. They had no incentive to sell to a developer at artifically low land prices. FINALLY, some one in City Hall looked at the neighborhood and agreed it was time to redevelop. They raised the height limitations and wa-la, the developers swam in, tear everything down and start building taller buildings.

It's too bad West Campus is the only residential neighborhood in Austin where you can do this. The rest of the city's neighborhoods will have to sit and wait, maybe another 50-years, until City Hall thinks their neighborhood is worthy of redevelopment.

I'll take Houston's imprefect development strategy over city's "plan" any day of the week. I have visitors from around the country come to my 1993 vintage, fee-simple, no maintenance fee, 3-bedroom, 3.5 bath, 2-car garage, 2,400 SF, 3-story townhouse in 77019. They are BLOWN AWAY that I bought it in 2004 for $275k. In MANY other big city real estate markets, the EXACT same thing would cost $1 to $1.5 million, maybe more.

People in Houston have no idea how good we have it.

bpe3

[GoneGator]

Here in Orlando, FL we're seeing a few townhomes, but many more lowrises built out to street level with commercial development on the first floor. I suppose it's some sort of pseudo-urban look. I'm sure it will mark the 2000s the same as turquoise and pastels marked the 50's-60's.

[missmsry]

Ok, I'm inside the loop, living in a 1927 duplex (owned free an clear). At the end of the block they are currently building 6 townhomes, 4 stories, with a fifth-floor roof deck, and don't forget the elevator. Supposedly, we are in a housing downturn, so what's the deal? Is it location or has the Houston economy not caught up yet?

[TheNiche]

Ok, I'm inside the loop, living in a 1927 duplex (owned free an clear). At the end of the block they are currently building 6 townhomes, 4 stories, with a fifth-floor roof deck, and don't forget the elevator. Supposedly, we are in a housing downturn, so what's the deal? Is it location or has the Houston economy not caught up yet?

Construction of starter homes has declined precipitously, reflecting that class of buyers' lesser ability to get mortgages these days. Middle-priced homes have seen construction starting to wane, but only in the last quarter, and it isn't crashing because mortgages are still available, albeit with somewhat less favorable terms. Even high-priced homes are doing even better as far as construction goes.

Bear in mind that Houston is still adding upwards of 60,000 jobs per year. Our economy is still in great shape. We can't avoid all the financial problems, but our fundamentals still look pretty damn good. We aren't overbuilt.

[N Judah]

On the townhome issue in Sea-town:

http://seattlepi.nwsource.com/ae/353511_arch04.html

http://www.king5.com/business/stories/NW_0..._LJ.e81c96.html

[musicman]

On the townhome issue in Sea-town:

http://seattlepi.nwsource.com/ae/353511_arch04.html

the projects' typical worst feature, the driveway or "auto court" that bisects the eightplexes to provide access to garages and, frequently, main entrances as well. "Who wants to look into these narrow, dark, paved-over spaces?"

concur.

[bpe3]

The Seattle projects referenced are nice, but they sure aren't cheap.

"Prices range from $695,000 for 1,575 square feet to $925,000 for 2,200 square feet."

Four of the units are priced at $325,000 to $350,000. That undercuts the typical two- or three-bedroom Craftsman townhouse, but these are one-bedroom lofts of just 776 square feet.

There's an active thread on this same board where Houstonians are scratching their heads about how people can afford to pay $300k to live inside the Loop. Most Houstonians have no idea how good we have it.

bpe3

[midtownguy]

I have visitors from around the country come to my 1993 vintage, fee-simple, no maintenance fee, 3-bedroom, 3.5 bath, 2-car garage, 2,400 SF, 3-story townhouse in 77019. They are BLOWN AWAY that I bought it in 2004 for $275k. In MANY other big city real estate markets, the EXACT same thing would cost $1 to $1.5 million, maybe more.

People in Houston have no idea how good we have it.

bpe3

That's nice, but I prefer my 1944 vintage, fee simple, no maintenence fee, two bedroom, one bad, one-car garage, 1300 square feet, renovated, ARCHITECTURALLY SIGNIFICANT, close in in a quiet, tree-lined neighborhood house in 77009.

Every single house in my neighborhood is different. EVERY SINGLE ONE. Nothing is cookie cutter.

I like that.

You assume that we don't know how lucky we have it here. I do. I think about it every day. I paid 150k for my little cottage, and this neighborhood is improving rapidly. Houses over here don't stay on the market for long.

[bpe3]

It's a great world we live in. There's something for everybody.

bpe3

[N Judah]

The Seattle projects referenced are nice, but they sure aren't cheap.

No lie. There may be a reason for that, too --

http://www.crosscut.com/blog/real-estate/1...housing+prices/

http://seattletimes.nwsource.com/html/busi...4_eicher14.html

Of course, even at these prices, people continue to snap them up. The geography of the area is really appealing (in my opinion).

Edited March 10, 2008 by N Judah

[bpe3]

That second link is right on point, Judah. Here's a quote from one of the other links above about townhouse development in Seattle:

It took him five years to get all the proper permits and approvals.

You don't have to be an economist to figure out what would happen to real estate prices in Houston if it took FIVE YEARS to get approval to build townhouses, apartments, etc. Prices would be through the roof. Demand is demand. Houston has created 170,000 new jobs in the last two years alone. These people have to live somewhere. If you you don't add the supply, prices go up. In my option, one of the best things Houston (and the suburbs) has managed to do is allow the supply keep up with the demand.

Houston's moderate real estate prices have become a magnet for talented people. I know of several college educated couples who decided to move to Houston specifically for the affordable real estate. I'm good friends with one couple that moved here from Chicago several years ago. Both were college educated people with decent careers. They wanted to get married, have kids, etc., but they looked around Chicago and didn't see how they'd ever be able to afford the lifestyle they desired. They didn't want to raise their family in a 1,000 SF condo and the didn't want to move out to BFE to buy a home. They both started looking for jobs in Houston and within six months they were here and gainfully employed. A year later they bought a home just west of the Galleria. A year after that they started a family.

They looked objectively at options all across the country and chose Houston as the best combination of big city amenities and housing affordability.

bpe3

[houstongal]

The Seattle projects referenced are nice, but they sure aren't cheap.

"Prices range from $695,000 for 1,575 square feet to $925,000 for 2,200 square feet."

Four of the units are priced at $325,000 to $350,000. That undercuts the typical two- or three-bedroom Craftsman townhouse, but these are one-bedroom lofts of just 776 square feet.

There's an active thread on this same board where Houstonians are scratching their heads about how people can afford to pay $300k to live inside the Loop. Most Houstonians have no idea how good we have it.

bpe3

Having our home prices cheaper than other places has nothing to do with a person with annual income of $80K being able to afford a $300K home. Regardless of whether the home prices are $1.5m or $500K, if you can't afford it you can't afford it. You can't say just because some markets are more expensive than others it's okay to put yourself in unnecessary debt.

[bpe3]

You can't say just because some markets are more expensive than others it's okay to put yourself in unnecessary debt.

Where did I say anything like that? I think you're in the wrong thread. This thread is about the townhouse trend in Houston. There's another thread about people making $80k a year and buying $300k homes. If you read it, you'll see that I clearly said you need to do one of two things to be able to afford a $300k home:

1. make a lot more than $80k

2. put down a large down payment.

I agree with you 100% that leveraging one's self to the hilt to buy a home is a really bad idea. When I bought my home, I bought FAR less than I could afford. I put 20% down and paid off the rest of the loan over 12 months.

The fact of the matter is that Houston home prices are a SCREAMING bargin when compared to many other large American cities. I realize that certain neighborhoods are still out of reach of many homebuyers. If you can't afford the house of your dreams in Houston, you should take solace in the fact that if you lived in many other cities your dream would be even farther away from reality.

bpe3

[N Judah]

Of course, for people who were homebuyers/homeowners in these areas prior to demand going up, it's in their best (financial) interests to restrict supply as much as possible.

Actually that may be a cynical way of putting it, as many of these people (who in most cases grew up in the area) genuinely want to protect their neighborhoods' character (a problem that Houston does not have).

You don't have to be an economist to figure out what would happen to real estate prices in Houston if it took FIVE YEARS to get approval to build townhouses, apartments, etc. Prices would be through the roof.

Actually, I think that since Houston (unlike everywhere else) does not have height restrictions etc. they would simply compensate by making the highrises even taller.

Edited March 11, 2008 by N Judah

[houstongal]

Where did I say anything like that? I think you're in the wrong thread. This thread is about the townhouse trend in Houston. There's another thread about people making $80k a year and buying $300k homes. If you read it, you'll see that I clearly said you need to do one of two things to be able to afford a $300k home:

1. make a lot more than $80k

2. put down a large down payment.

I agree with you 100% that leveraging one's self to the hilt to buy a home is a really bad idea. When I bought my home, I bought FAR less than I could afford. I put 20% down and paid off the rest of the loan over 12 months.

The fact of the matter is that Houston home prices are a SCREAMING bargin when compared to many other large American cities. I realize that certain neighborhoods are still out of reach of many homebuyers. If you can't afford the house of your dreams in Houston, you should take solace in the fact that if you lived in many other cities your dream would be even farther away from reality.

bpe3

Okay. Gotcha.