Trying to turn renters into buyers in Dorchester
As developers chase potential buyers, they are getting aggressive with the incentives.
I mean really aggressive.
Just take the Carruth, a new residential complex in the Ashmont section of Dorchester that had the misfortune to open just as the real estate market was starting to fall apart.
Trinity Financial has sold just a handful of units, renting the remaining 36 units out.
The developer has already cut prices – down to the $239,000-to- $399,000 range, down from $299,000-to-$499,000 previously.
Now Trinity Financial is rolling out two more incentives in a bid to turn renters at the Carruth into buyers.
Renters interested in buying now have the option of putting three months rent – at an average of $1,800 a month – in an escrow for use in closing costs or in making a down payment.
That still leaves another big hurdle – the 20 percent down banks now expect from condo buyers.
Trinity Financial will now cover three quarters of that down payment on a $229,000 unit – or $34,350 – through a loan to the buyer.
Independently, the developers note, there’s also the $8,000 a year tax credit from the federal government and a $1,400 city residential tax credit.
It’s quite the sales pitch, but will it work? While there are signs home sales may be starting to pick up again in the Boston area, Dorchester has been one of the hardest hit neighborhoods in the Bay State when it comes to foreclosures.
There are a lot of foreclosed condos out there and they are going for a lot cheaper than even what the newly reduced units at the Carruth.
That said, you get what you pay for, and a $50,000 foreclosure special may cost you another $200,000 or more to make habitable.
Nor are there a lot of new, market rate residential complexes like the Carruth out there to pick and choose from in Dorchester.
We’ll see how it works out.
