Condo market questionable for the near future


We all know that the real estate market in general is causing anxiety for many. But how are condo owners and sellers faring in this market? Maybe even worse.

And it's all thanks to the developers. They're continuing to build and build, continuously adding to a condo market that many people think is already saturated. Consider these statistics for 2008 quoted by the Wall Street Journal: 4,000 new units coming in Atlanta, 4,000 in Phoenix, 10,000 in Fort Lauderdale, and 2,500 in San Diego.

The WSJ also reports that 2007 ended with about a 10 month supply of condos available across the country, and they say this is the highest level since 1999. So there's definitely a risk to all the players in the market, including the sellers and the banks. And even though many of the condos have buyers who paid deposits on units, some of those deposits were so low (only 3% of purchase price) that some fear the buyers will back out and forego their deposits because of decreasing condo values.