Condo, Loft Units Selling Well in Ann Arbor Housing Market
The success of this year’s University of Michigan football team isn’t the only thing Ann Arbor residents have to be happy about.
Their city is defying the norm across the state of high unemployment and a struggling housing market.
In the next two years, almost 800 new residential units will become available for living in downtown Ann Arbor, a city of 110,000. According to The Detroit News, this compares with 274 units that became available between 1990 and 2000.
Moreover, demand for residency and mortgage loans appears to be keeping pace. Of the 353 units in five projects, just over half have been reserved or sold by prospective tenants.
First-time buyer Shirli Kopelman, 38, closed last week on an upper-floor, one-bedroom unit at Liberty Lofts that features views of Michigan Stadium, floor-to-ceiling windows and a spiral staircase. She said it’s possible to get almost anything she needs downtown without driving.
“For me, it’s starting to feel like a city,” said the former resident of New York, Chicago and Israel. “It’s really a community and something I never felt growing up in Ann Arbor Hills. I’m not a big fan of fences.”
The success of the hundreds of condos and lofts - most of them for sale but including some rentals, along with low-income and affordable housing units - is being closely watched by developers, planners, city officials and others interested in the future of downtown.
From Jan.1 through Sept. 30, condo listings were up 13 percent in Washtenaw County even though sales were down 11 percent, according to the Ann Arbor Area Board of Realtors.
Prices for the three downtown projects currently under way range from $180,000 to $990,000. Contrast these figures with the $163,000 median sale price for condos countywide and you see why some home loan applicants may be waiting for prices to drop further.
Michigan’s 7.1-percent unemployment rate for September was the second highest in the country, 2.5 percentage points higher than the national rate for the same month.
While Washtenaw County might be a bright spot in Michigan’s economy, some developers concede that interest in downtown units cooled when it was time to sign the dotted line. Downtown Development Director Susan Pollay said the question isn’t whether too many projects have come online, it’s how quickly they’ll be bought.
Christopher Leinberger, director of the graduate real estate program at the University of Michigan, said he expects buyers to continue to invest in downtown dwellings. Ann Arbor boasts walkability and has a highly educated work force drawn to downtown living, he said.
“There’s no question there is a pent-up demand for it,” he said. “The issue is whether the economy will allow people to move.”