A slowed housing market and excess inventory of condominiums is causing several Baltimore-area developers to rethink their development plans.

“The market is changing, and there is a glut of unsold real estate on the market,” said real estate agent Robin Green of Long & Foster. “Properties are staying on the market longer, and developers are drastically reducing prices and offering incentives to get rid of their inventory. The condo market is taking a big hit right now.”

Recently, developer Struever Bros. Eccles & Rouse was forced by depressed market conditions to redesign its plans for luxury condos in the Charles Village area and instead convert the project to smaller, market-rate apartments.

The $83 million project on the 3200 block of St. Paul Street called The Olmsted was to include more than 100 condominiums, 12 floors of residential space, and 15,000 square feet of retail and parking on the lower level. The condos would have cost up to $700,000.

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The Icon Tower building, a project planned for Canton, was voted down by Baltimore City Council members due to community concerns about the height of the building and that excess inventory of condos on the market would reduce property values for existing residents.

RWN Development Group has put on hold its plans for twin tower condo buildings in downtown due to the market, and other developers are making similar changes in response to the market.

“The pipeline of buyers has become truncated by regulatory changes in how buyers are qualified for loans,” said Anirban Basu, chief executive officer of the Sage Policy Group. “Many people who would have qualified four years ago no longer qualify, and it is affecting the market, which leaves more product on the market, and developers see that.”

Basu said high-interest adjustable rates and the virtual shutdown of the subprime market have limited the number of lenders for borrowers with checkered credit histories or no history at all. And proposed changes in the lending industry will make homeownership for many Americans a thing of the past.

“It is no longer a buyer’s market, because more stringent lending guidelines are cutting their numbers,” said Ashidda Khalil, director of the Baltimore office of the Neighborhood Assistance Coalition of America. “Developers will no longer find a steady stream of buyers to hawk their inventory to.”

rchappelle@baltimoreexaminer.com