Baby, we got a bubble!?

[Admiral Beez]

2-3 bedroom units would be 800-1000 sqft. To hit $500k that means a cost psf of $500-$600. When preconstruction units are going for 2.5 to 3x that amount.

But are they going for that amount now, or sitting “ungone”, unsold? Developers can address the demand side of the volume collapse by offering the market what it wants and can afford. If the market wants and can afford $500 psf then if you want to remain in the mass condo market that’s what you need to make. Perhaps we’ll see developers decide they cannot and leave the market?

 

[afransen]

Seeing as developers don't have 60% margins, I don't think they could profitably offer $500 psf developments. So they won't.

 

[Admiral Beez]

Seeing as developers don't have 60% margins, I don't think they could profitably offer $500 psf developments. So they won't.

Well, developers and their customers losing their shirts maybe costs and fees faced by developers will need to come down.

 

[TheKingEast]

At 500 PSF, you need to have the government build housing. Developers are private businesses who are in the business to make a profit. The math doesn't math.

 

[evandyk]

Does $500/psf even cover construction costs now, never mind the cost of land or financing?