Condo Hell

CONDO HELL….The latest from the Wall Street Journal:

The condominium market is about to get worse as many cities brace for a flood of new supply this year — the result of construction started at the height of the housing boom.

….Regulators have been sounding the alarm for weeks about the exposure of small and mid-size banks to commercial real estate, which mostly means construction loans to developers of condos and single-family housing.

Lenders of all sizes have $42 billion of condominium debt on their books, according to Foresight Analytics. In just three months — between the third and fourth quarters of last year — the delinquency rate rose to 10% from 5.9%, says the Oakland, Calif., research firm.

Oh goody.

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