Do Your Homework if You're in the Vintage Portland Condo Market
Recent tremors underground may indicate that Portland is overdue for some significant seismic activity. The problem is that the city still has many of the most vulnerable types of buildings, unreinforced masonry structures, within its borders.
The clear solution would be to use seismic retrofitting to modify these buildings so that they have a better chance of surviving an earthquake. These modifications could include various techniques or combinations of techniques:
- External steel frames
- Base isolation
- Structural reinforcing walls
Unfortunately, all of these solutions come at a significant cost. Furthermore, the expertise necessary to determine which strategy is best for given building usually also comes at a premium. For many Portland owners, this has the potential to add up to a significant bill.
When it comes to the discussion of who's at the epicenter of these retrofits costs, the individual condo owners for these URMs keep coming up. Some estimates put the individual cost for a 400-square-foot unit at $80,000. Even with the way property values have increased over the years in Portland, that price tag could represent a complete leveling of equity for some owners.
Condo associations with high reserves — or those with high tenancy and financially sound ownership — may be able to handle this change of circumstances. After all, these types of special assessments are the reason that HOAs manage these reserve accounts in the first place. Of course, it goes without saying that not every unreinforced masonry condo building will be so lucky.
To make matters more complicated, Realtors have differing opinions on whether the seismic reinforcement status of a building should be disclosed. It begs the question: What should buyers do?
Most of the new high-rise buildings that have gone up in Portland's rapidly renewing areas should be as safe as technologically possible during earthquakes. As for buildings on the URM list, buyers may be well advised to do a little homework of their own before signing that final contract.
It's safe to say that the seismic tremors aren't the only disturbances in Portland these days. This retrofit topic is causing some chaos of its own. The bottom line is that, until the issue is resolved, it could be a buyer-beware environment for those shopping off of Portland's URM list. We encourage potential buyers and sellers alike to reach out to our team of local experts to develop strategies and stay informed of changes in the market.