If you are looking to buy a condo, a recent change to FHA loan requirements may just have made your condo purchase more difficult.

In order to get a FHA/VA loan on a condo, the condo development must be FHA approved. If the development has not been approved, it needs to go through a certification process, which checks various criteria such as: must be 50 percent owner occupied, less than 25 percent commercial use, no more than 10% owned by one investor etc. This certification process takes anywhere in the region of 3 weeks to 3 months once the paperwork has been received.

What’s the problem you may ask, surely most the condo developments must have already been approved. Well yes they were, but a recent change means that any development that has not been approved in the last two years will have to reapply for certification. This means that most developments, with maybe the exception of some of the newer ones, will not be able use FHA loans until they have been recertified, which may take some time depending upon the efficiency of the HOA (HOA needs to provide numbers on owner occupancy etc.) and how long it takes the FHA to approve the certification.

This is not just a Salt Lake City Condo Market problem, all condo developments in the U.S. have had their approval status expire.

The only way around this issue is for the buyer to obtain a conventional loan instead of a FHA/VA loan, thus circumventing the approval process. The problem with this is that conventional loans require stricter credit qualifying criteria, and the down payment requirements are greater.

Read this Buying a Condo Just Became More Difficult article on our real estate blog.

Prices have been announced for the downtown Salt Lake City Creek Condo developments and as you may expect they are expensive. Prices range from $500 to $800 per square foot. To put this in perspective in the first quarter 2009, just 5 condos were sold in the entire downtown area, with an average price per square foot of just $205. That puts the starting price of a City Creek Condo at approximately 150 percent more than the current cost of a downtown condo.

Now don’t get me wrong the City Creek development will be a quality development and probably deserves to be sold at a premium to other condos, but given the current state of the real estate market, it does not seem how such a high premium can be justified.

There are currently two options available if you want to purchase a condo in the City Creek development, The Regent and Richards Court (which in turn is split into Richards Court East and West). Richards Court is located at the gateway between Temple Square and City Creek, the development is comprised of two ten story buildings flanking a tree lined promenade through which flows City Creek. The Regent is a 20 story ultra modern looking building located at the south end of the City Creek Center project on 100 South.

Green building trends, and environmentally conscious living, are growing in momentum all across the United States, and included in that movement is the city of Boston, where a first of its kind green residential development recently opened to the public. The Macallen Building in northern South Boston opened to residents in June of 2007 (see related event information on the Boston Condo Blog) as the first gold-level Leadership in Energy and Environmental Design (LEED) certified condo development in the Massachusetts capital.

The new condo development is nestled among hip, and up and coming, Boston condo developments in an area less than a ten minute walk from the core of downtown Boston, and is immediately accessible via the Boston subway, called the “T”.

The Macallen Building strived hard to achieve the highest LEED green certification level.  Due in part to its green roof, the Macallen will save over 600,000 gallons of water each year, and its systems allow for annual electric savings of approximately 30% compared to similarly sized buildings. One of the most striking features of the Macallen Building is its sloping 6 to 12 story green roof, which is set with sedum, a flowering plant that will change colors with the seasons collecting rainwater runoff for landscaping use.

The entire building is non-smoking, and unique to Macallen is heating and air conditioning systems in each unit that pull fresh air, not re-circulated air, from the outside directly into your unit to maintain the best indoor air quality, while insulation comes from recycled jeans.  The development team, Pappas Enterprises, went so far as to come up with a Green Manifesto.  The Macallen Building at 141 Dorchester Avenue in South Boston has set the gold standard in Green construction for Boston real estate, and it will be up to those following the Macallen to keep pace with the high standards that have now been set for future city of Boston condo developments.