Condo conversions revert to rentals

South Florida Business Journal reports:

Six communities with 1,571 units - three in Broward and three in Palm Beach County - have made the switch from condo conversion sales back to rentals.

Some are dubbing it "the great conversion reversion of 2006." It's a move to reposition rental communities, which were slated for condominium conversion sales, back to apartment rentals.

A slowing sales market and a high-demand rental market with rising monthly rates are the motivations for the switches, said Jack McCabe, CEO of McCabe Research & Development in Deerfield Beach. He is the author of the Condominium Conversion Report and the Commercial Apartment Market Report, quarterly data services that track South Florida multifamily communities of more than 100 units.

"It's an early-stage trend that will probably accelerate as the market slows even more," he said. "For well-managed communities, the improved cash flow from enhanced rents may help carry them until the conversion sales market comes back into balance."

In other words, converters might try again in a few years.

Square footage is square footage.Does everyone need a second piece of property?