Homeowners Making the Shift to Condos
When the S&P/Chase-Shiller home prices indices report for April was released at the end of last week, it showed strong gains in the construction of new housing, with 34 percent of housing starts coming in the form of apartments and condos.
The good news, though, is that despite the shift toward condo living, prices for such housing units is not expected to rise.
“While the shift in consumer preferences for condos versus single family homes seen in the housing starts data may be a change in people’s housing preferences or housing affordability, it does not appear to be changing the patterns of price movement,” said David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones. “Moreover, the shift to condominiums isn’t likely to make home prices more or less volatile than in the past. It certainly won’t reduce the risk of another housing boom-bust cycle in the future.”
Image via flickr/Kevin Dooley