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Atlanta condo projects feel weight of housing crunch

By
Services for Real Estate Pros with Harlan and Associates, LLC

From the Atlanta Business Chronicle:

Atlanta's biggest condo projects aren't immune to the rash of foreclosures that has swept through the city's residential real estate market.
 
Several prominent condo towers from downtown to Buckhead have been affected, including Novare Group Inc.'s TWELVE Atlantic Station, Julian LeCraw and Co. Inc.'s The Paramount at Buckhead and Condominium Ventures of America Inc.'s 1280 West.

and:

At Atlanta's 15 largest condo projects, the rate of foreclosure ranges from 1 percent to 5 percent.

"I don't want to be an alarmist, but the numbers we're seeing right now are serious, especially given that oversupply on the market has been a huge issue and will continue to be," said Jude Rasmus, president of Rasmus Real Estate, which works on behalf of banks to sell foreclosed homes and condos.

The foreclosure data is combined from Equity Depot LLC, an Atlanta-based real estate research firm, and Haddow & Co., one of the few real estate services that tracks the health of the city's condominium market.

When compared with Georgia's broader residential real estate market, the percentage of foreclosures among large intown condo developments is higher. About one of every 351 homes, or less than 1 percent, has been foreclosed, according to national foreclosure research firm RealtyTrac LLC.

and:

Developers are adding big incentives to sell a unit - up to $4,000 to brokers who complete a sale in some cases. That makes it hard for some sellers to compete.

Central City Condominiums, an 88-unit development downtown, has slashed prices on its one- and two-bedroom condos by 27 percent and 28 percent, respectively. One bedroom homes that once sold for $180,000 now sell for $129,900. Two bedrooms go for $204,900, down from $287,000.

It certainly has become a tough time to sell a condominium in Atlanta. With the recent program changes by the private mortgage insurance companies and new declining market guidelines by the mortgage lenders, is it becoming increasingly harder to find qualified buyers for metro-Atlanta condos.

With the number of condos coming onto the market, and the continuing difficulty that buyers are having in obtaining financing, that condominium projects are showing a higher-rate of foreclosure when compared to the rest of the market will only serve to depress prices further.

Intown condominiums have long offered ease-of-lifestyle as a strong selling point. Less traffic, easy access to restaurants, museums, and other attractions have long made living in the city attractive. These days, that ease-of-lifestyle is not enough, and prices are taking the big hits as developers, individuals, and the lenders all try and sell.

 

 

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