As the [tag]housing market[/tag] cools, it may be a good time to take a hard look at buying into a community association for a more affordable first home, a vacation home, rental property, retirement home or long term investment. Speculators are bailing out of once super hot condo markets and some potential first and second-home buyers, thwarted by higher energy costs, are opting for the rental market instead. As a result, [tag]condo inventories[/tag] are rising and the sector is turning around faster than the single-family detached home market.

Depending on the location, the growth in city core condo concentration is due to reduced land availability; the need for more practical, affordable, and high-density housing as well as high-end condos; the anti-sprawl movement; and the cool factor — young professionals want to be where the action is. NAR spokesman Walter Molony says price-boosting demand for condos can also be traced to capital gains tax relief beginning in 1998 and empty-nest baby boomers moving down or buying a second home, but seeking appealing amenities. Also, during the last housing boom, condos were selling like hot cakes to speculators and investors.

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