Kamikaze Condo Converters?

"In California, the condo slowdown has been particularly pronounced in San Diego and the Central Valley, where rapid urbanization attracted a number of investors who are now rethinking their strategies, according to Michael Carliner, an economist with the National Association of Home Builders."

Or not...

"Homebuyers may be turning sour on condominium conversions in a cooling real estate market, but five Sacramento County apartment owners are pressing for still more. They're seeking approval for 700 new conversions."

"The moves seem to fly in the face of lagging buyer enthusiasm nationally for apartments converted to for-sale condo units. Locally, some apartment owners who won conversion rights have held back on sales plans, while others who went forward have seen slow sales. From Florida to Folsom, some owners of conversion projects have begun a reverse trend of converting condos back to rentals."

"But investors from Los Angeles and the Bay Area say they're pressing ahead in Sacramento County, even though buyers already can pick from an abundant supply of new condos and sales incentives. These apartment owners hope to compete on price in an expensive market, and say if they falter now they'll be poised for the region's inevitable housing rebound later..."

"Apartment owners converted about 2,500 capital-area apartments to condominiums during the housing boom, according to real estate company CB Richard Ellis. Homebuilders, meanwhile, have sold nearly 5,000 new condos in the region since December 2003. With new condos representing at least 26 percent of new home sales so far this year, according to the Folsom-based Gregory Group, conversions from existing apartments are often a second choice for buyers. Experts call condo conversions a sign that real estate markets are peaking."