The Augusta native purchased her three-level condo on the corner of Walton Way and Milledge Road, in part, to be closer to her mother, who had bought in a similar condo development just up the street. After looking at single-family homes in a nearby neighborhood, Murphy decided she preferred a more hassle-free way of living.
“I think for someone like me, it’s a perfect size,” said Murphy, whose homeowner association fees pay for lawn care and other property maintenance. “I don’t have to spend all my time cleaning. It’s nice to lock the door and leave.”
Murphy, however, represents a small segment of Augusta residents who chose condo living.
A few things factor into why homebuyers here aren’t as inclined to purchase a condo.
“It’s supply and demand for condos, and it’s financing for condos, and it’s location for condos,” said Meybohm real estate agent Nick Greene. “What slows them down really is financing. It’s a little better than it used to be. There was a time when the market really got sloppy, that you could not get financing. The only way you could buy a condo is to pay cash for it.”
Two years ago, Murphy paid $147,000 in cash for her home. Greene, who was Murphy’s agent, said another client also paid in cash in July to buy a $150,000 condo in the Summerville area.
Banks tightened regulations on condo financing after the housing bubble burst in 2008. Places such as Florida, coastal cities and other condo-heavy areas were dealt a hard blow as many owners walked away from their units, causing homeowner association fees to quadruple in some cases.
Now, unless a development is on approved lists from the Federal Housing Administration, Fannie Mae, Freddie Mac or the Department of Veterans Affairs, many mortgage companies are reluctant to issue a loan and borrowers have to jump over more hurdles.
Additionally, projects on these approved lists can drop off at any time if occupancy shifts to more renters than owners or if homeowners default on paying their HOA dues, said Jenny Caldwell, president of First Choice Mortgage in Augusta.
“It’s hard to get a condo project approved because of those two things right there,” she said. “So projects approved several years ago or even two to three years ago may be denied now.”
Each condominium building is different in the way financing terms are handled, but extra documentation is a prerequisite when compared to buying a standalone residence, said Bart Chandler, senior vice president of Georgia Bank & Trust Mortgage.
“There’s just additional limitations that are placed on what the association of those units have to do so that they remain eligible for secondary financing,” said Chandler, adding that condo financing represents a small percentage of his overall mortgage business. “There can be regular financing available, there are just more complications involved.”
In the past two years, Greene said he’s not sold more than five condos across the area and they tend to stay on the market for at least six months. He currently has an 11th-floor unit in the pink Port Royal building off Reynolds Street on the market for $224,900. He predicts the two-bedroom, 2.5-bathroom property could take about a year to sell. It took a colleague about 14 months to find a buyer for a similar home in that same building.
“There haven’t been seven sold in that building in the last 10 years,” he said. “There’s nothing wrong with it. It’s fabulous. The view is incredible. The reality of it is that there’s only one of those in Augusta. If there were 25 or 10 or five, like there are in other cities, that would be a much more interesting property.”
Greene said he’s surprised that developers didn’t take advantage of prime real estate property along the Savannah River over the years for multi-use projects, but added that market demands dictate what type of development an area will see.
In Augusta, there are sparse pockets of condos mainly scattered downtown, near the Hill and off Steven Creeks Road.
“They come on the he market sparingly,” Greene said. “They take a little bit of time to sell, and that’s good because it keeps the prices fairly steady.”
For Murphy, her three-bedroom, 2.5-bathroom condo complete with original parquet flooring and a reclaimed fireplace was just up her alley, but she can understand how many would prefer more privacy.
“It’s sort of like apartment living but on a more permanent basis,” she said. “It’s not for everybody.”