SEATTLE (AP) — For Olive 8 and Fifteen Twenty-one Second Avenue — a pair of glistening high-rise, high-end downtown Seattle condo towers — 2009 is a year of reckoning.
Both projects broke ground and began marketing unbuilt homes in 2006, just as the real-estate boom was cresting. Most of the units sold within months.
Now the 400-foot-tall buildings are nearly finished. Fifteen Twenty-one started closing deals with buyers in late November, Olive 8 earlier this month.
But the real-estate bubble, of course, has burst. And some of those once-eager buyers from 2006 and 2007 are backing out, often at considerable expense to themselves and, perhaps, the projects’ developers.
At Fifteen Twenty-one, developer Opus Northwest says more than one-quarter of the original buyers have walked away, some forfeiting deposits of $100,000 or more.At Olive 8, at least 10 percent of the project’s buyers, who either can’t or don’t want to close, have retained lawyers in hopes of getting their earnest money back. “We’re talking $20,000 and up,” says Craig Blackmon, who represents five buyers.It’s hard to gauge how many others are considering pulling out. On an Olive 8 buyers’ blog, however, some write — always anonymously — that they plan to just walk away from their contracts and deposits, usually because they don’t have the higher down payments lenders now require.
Some contend it makes more sense to forfeit their earnest money than to pay 2006 prices in 2009.
“There are some scared buyers out there,” says James Stroupe, a Windermere Real Estate agent who specializes in condo sales. “It’s a new dynamic in this market.”
Tom Parsons, an Opus Northwest senior vice president, and David Thyer, president of Olive 8 developer R.C. Hedreen, both say they’re pleased with how closings are going so far.
Some buyers always drop out before sales close, they say, and the attrition rate now isn’t especially high.
