Down, Not Out

Look beyond Gay Street for value

 

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There's an interesting dichotomy about downtown—a mix of high-dollar lofts and the homeless, of bohemians and business suits, retired empty-nesters and neo-hippy hipsters. You can see it in the bar crowds. The 30, 40 and 50-somethings fill up the happy hours, while it's often midnight before the 20-somethings come out to play.

There is, however, one trend that is working at cross-purposes with downtown's diverse demographic mix: the housing market. The Sterchi Building, which some folks dismissed as doomed from the start because the rents were "too high," has turned out to be the base model in downtown's loft lineup. And as prices have risen, the market has largely shifted from rental to condos, largely because the booming market means that the gap in the project pro-forma historically filled by Historic Preservation Tax credits is, well, history. If the Sterchi Lofts were being done today, they'd likely be condos. And even the smallest units would probably be priced at more than a hundred grand. Which bodes well for the city's tax base but is a depressing development if you're a struggling 20-something who wants to live downtown but can't afford a six-figure mortgage.

Unless you broaden the definition of downtown, that is. Gay Street may have gotten out of your reach, but five or 10 minutes from Market Square there are beaucoup housing options, particularly if you don't mind being a little bohemian (face it, Gay Street isn't exactly "street" these days ).

Consider, for instance, this 2 bedroom, 1 bath cottage at 813 Hiawassee Avenue in Lincoln Park. With high ceilings and refinished hardwood floors it's got a lot of loft-like features, plus others you just won't get downtown, like three cool corner fireplaces or a back yard for grilling. And where the hell would you hang a porch swing in a third-floor walkup? And at $74,900 it's certainly affordable, whereas the price for 1,261 square feet downtown would probably be pushing $200K these days. ( For a showing contact Charlie Wilson with Coldwell Banker at 687-1111. )

But wait, there's more (how's that for a hard sell?). The city, thanks to the federal government, is offering some pretty generous down payment assistance these days.  Up to $5,000, so long as you make less than the max income requirements—the cut-off point for a single is $29,100—certainly in the ballpark for many 20-somethings. The money can be used to cover down payments and closing costs and comes as a five-year forgivable loan with 20 percent retired annually. Stay in the place five years and you just earned an extra five-grand in equity. And if you're dreaming of downtown, the funds are bumped up from $5,000 to an even 10 grand if you buy it in what is known as the Empowerment Zone—which includes most of the neighborhoods around downtown: Fourth and Gill, Old North Knoxville, Parkridge, Old Sevier, Fort Sanders, Mechanicsville and, coincidentally, Lincoln Park (which means, with the assistance, that monthly payments on this place will set you back less than $400 a month). Oh, and it includes downtown, too. So you could use the down payment for a downtown loft, assuming you can find one for less than the program's maximum eligible purchase price: $125,000. Good luck. m

 

Go to:

www.cityofknoxville.org/development/addi.pdf

for more info

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