Lenders who financed major condominium projects while the economy was stronger, and prior to the current mortgage crisis, are now reaching the point where their purchasers need to decide whether to complete their purchases, or walk from their (often significant) down payments.
The New York Times reports that one lender, Corus Bankshares, has 92 percent of its developers’ accounts receivables in condominiums. The condominium construction boom is peaking this year, with completed condominiums up 45 percent from 2006. Meanwhile, sales have fallen 12 percent. In the last three months, sales in Vegas are down 46 percent.
Right now, I think I’d prefer to have my money on a table than on a down payment.
Here’s a link to the article.