From the Atlanta Journal and Constitution:

The subprime mortgage crisis and subsequent global credit crunch have claimed another victim: the Atlanta condo.

Local real estate developers say financial backing for condo projects has all but dried up. Those able to get financing are turning to high-end rental apartments instead.

“Building condos right now is next to impossible; it really is,” said Stephen Franco, a partner at Franco DeFoor Properties, an Atlanta real estate development company. “It’s just financing. You can’t get financing for condos.”

High-end apartment complexes are in the works across the metro area, from trendy intown Atlanta neighborhoods to more suburban locales. Franco DeFoor is planning to build 250 to 300 upscale apartments on Memorial Drive in southeastern Atlanta’s Reynoldstown neighborhood, not far from a cluster of condo complexes.

“The new darling child of multifamily residential is rental,” Franco said.

Atlanta’s once high-flying condo market is reeling from an oversupply of units and a drop in demand as prospective buyers either can’t get loans or are choosing to rent until the economy improves, real estate experts say.

It’s a dramatic about-face for Atlanta’s housing industry, which became infatuated with condos earlier this decade. The building binge changed the city’s skyline and introduced a generation of Atlantans to high-rise living.

The condo craze was fueled by the soaring popularity of intown living. Growing numbers of young professionals and empty-nesters sought a big-city lifestyle, where they could avoid lengthy commutes and walk to restaurants and shops. Lax lending standards, meanwhile, greatly increased the customer base.

Although the Atlanta condo market never became as overheated as areas like Miami, a glut of units has forced prices down and left some buildings half-empty. And a number of condo projects begun during the boom are under construction and poised to come online, further saturating the market.

With more high-end condo developments being built, expect this trend to continue.