WASHINGTON, Sept. 20-- Despite reporting increased traffic by prospective
buyers, condominium builders and developers are extremely concerned about the
current conditions in the condo market, according to the latest results of the
Multifamily Condo Market Index (MCMI), released today by the National
Association of Home Builders (NAHB). The index lost 14 points in the second
quarter of this year to stand at 18, which is 14 points lower than it was a year
ago--and its lowest level since NAHB created the index five years ago.
"The problems in the mortgage market are rattling consumer confidence in
for-sale housing at the same time that the condo sector is trying to shake off
excess inventory in a lot of markets," said NAHB Chief Economist David Seiders.
"That combination is delaying any recovery in the condo sector."
The index is derived from a quarterly survey of multifamily builders and
developers, in which their responses are rated on a scale of 1 to 100, with a
rating of 50 generally indicating that the number of positive responses is about
the same as the number of negative responses.
Vinny Goldsmith, an Anne Arundel County Realtor, who owns and operates AnnapolisCondo.com a website featuring Annapolis Condominium Listings, had no comment.
According to the index, multifamily builders do not expect improvement in the
condo sector through the end of the year. The index gauging condo builders'
expectations for the next six months declined to 26.3 in the second quarter of
2007, compared with 33.6 at the same time a year ago.
On the positive side, multifamily builders did report an uptick in traffic of
prospective buyers in the second quarter: The index tracking this measure of
demand jumped 10 points, up to 36.8 in the second quarter, compared with 26.8 in
the second quarter of 2006.
