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Residential development on a precipice?
By adamg on Thu, 09/29/2022 - 11:18am
Scott Van Voorhis reports financing for construction of new apartments and condos seems to be drying up really quickly - and that some developers who have approval to put up new buildings are looking for buyers rather than starting construction themselves.
With apartment rents at all-time highs in the Boston area, any drop off in construction would be bad news.
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Comments
NIMBYS rejoice
nothing makes NIMBYS happier than neighborhoods filled with empty post-industrial lots and abandoned buildings, as long as nothing new gets built there.
All in the name of preserving a weird status quo: maintaining an artificial supply scarcity. But think of the traffic and children that were saved!
Oh you're just looking at the Harvard lots
Obvs
9 trillion(!) in stock market losses
In the last six months coupled with very high borrowing rates and a lot of uncertainty makes this no surprise. All those people that were looking to buy a home instead of rent are stuck renting with 7% mortgage rates for well qualified buyers compounds the rent issue. It’s not good and will likely get worse before it gets better.
Doesn't matter.
No more mean tweets.
Blaming Biden for this?
Blaming Biden for this? America is doing a lot better than some other countries. Look at what conservatives have done to the UK.
"mean tweets"
They were a symptom, not the actual issue. Yes, many of us prefer that the President not be an asshole and bully. But the real concern is that he is a fascist authoritarian. When the question is that of fascism vs. liberal democracy, I am going to vote for democracy. Every. Single. Time. No other issue matters as much. So keep posting that mean tweets meme, all you are telling us is that you'd be cool with a fascist dictatorship.
Present tense, present President?
To be sure I reread this post several times. Each time I came away with the idea that Biden is called a fascist authoritarian. The reason I keep thinking I misread this is that the paragraph is intelligible and so i would have not question about the writer's base intelligence.
Yet I can't interpret the statement any way other than as directed toward Biden.
That claim is absurd, silly, wacko and so utterly divorced from reality that I wonder if there is a person on another planet channeling the idea to the writers.
If a person perceives Biden as a fascist authoritarian, YET, implicitly acknowledges that the last White Resident was an asshole and bully, then I am concerned for the writer's brain wiring. There is a cognitive dissonance that makes a severely out of tune piano sound smoother than a kitty's purr.
Sorry about the confusion
It was not a statement about Biden, but about any President in general. Hence, my use of the present tense. But for a specific example, indeed the past tense would be the way to go, because Trump is indeed the "mean tweets" guy most likely referenced in the preceding comment.
Bit of advice:
When that is your reaction, you probably are reading things incorrectly. The Internet is a rather informal medium, and some conventional rules of writing don't always apply. Occam's razor, though, always applies.
Thanks for the clarification
Yes, I did indeed read the comment as referring to Biden.
Bit of advice via a book title: "Eats, Shoots and Leaves." What does that mean? Of course context tells the reader what the title means.
The context that I saw was one where there is 1 paragraph, where the reference is to a president that is he and is uses present tense. One paragraph suggests that the reference is to one president, not future presidents. Using he in the context potentially excludes women as president in the future - since he is generally not used to refer to men and women, and well, present tense refers to what is happening here and now.
I believe that clarity and precision in communication matters. Not that anyone is perfect. Heck no. Like all good things these qualities require constant practice.
Add that it is by way of the the purposeful lack of clarity that people who spread disinformation and lies manage to sound truthful and factual.
I agree that referencing Ockham's Razor is useful. What I've learned is that Ockam's Razor suggests not adding more than is necessary for an explanation or communication. But it does not mean keeping out what is necessary to clearly and precisely communicate.
For me at least clarity and precision in communication are hard. Both attributes require more energy than fast and loose communication. But the results are worth the effort.
No More Hiding American Destroyers Either
https://www.washingtonpost.com/politics/2022/09/29/new-details-bizarre-e...
But all hail the idiot king, who most certainly never experienced stock market crashes during his reign, either...that YOU can remember
Damn that Brandon
He should really stop turning down that giant knob in his office labeled "stock market prices".
That’s literally what the fed is doing
.
Damn that Brandon
He should stop using all that power he has over the Federal Reserve to force them to take specific actions, since that's definitely a thing that's covered under his Presidential authority.
big slowdown...
Residential construction starts are going to slow in the next couple years to levels not seen in Boston since 2009-2010 or so. Interest rates, construction costs, and now new regulations being proposed that require anything over 20k sq. ft. to be "net zero" immediately. Things will not pencil out. Boston is only going to get more unaffordable as demand for housing will continue to far outstrip supply. Bank on it.
Does that mean
contractors will become more available for current homeowners who want to get work done?
Ya Suffolk and et el
Will be lining up to fix your gutters.
Although they operate in the same industry, they’re not the same.
Honestly, yes
But loan rates and material costs are high so might want to put it off unless you’re paying cash.
Maybe
They won't want a 50% deposit on work they're not starting for six months, either.
The free money party is over.
And a lot of projects which might have made sense with commercial loan rates in the 3-4% range are completely infeasible with those same rates at 7%. The subset of home buyers who can afford a $750K condo/starter home is much smaller at 7% than it is at 3%.
Plus the rapid increases in construction costs fueled in part by all that free money make it even more difficult to make the numbers line up for new projects. I don't even think the life sciences projects will move forward since venture capital money is probably going to dry up, too.
Looks like things are going to be a lot quieter for the ZBA and BPDA for a while.
Yep
I had a project I've been involved with for the last 6 months that's a new 4 story lab / Office building that has passed the ZBA in the last month go on hold yesterday due to financing not finalized.
If apartment rents are at an all-time high
doesn't that mean there is plenty of demand for these projects?
Yes
But the cost of practically everything else is also at an all-time high -- construction materials, land, labor, etc. About the only thing which isn't (yet) at an all-time high would be interest rates; they were much higher in the late 1970s/early 1980s, but this is still the highest they've been in decades.
Even if you can get people willing to pay $5K/month for an apartment, you still can't move the project forward if the financing is going to cost you $6K/month per apartment.