L.A.'s new luxury condos having a tough time

Developers were expecting their projects to sell out before completion, but the reality has been quite different. The new properties are only 6 percent to 45 percent sold, according to THR - and that's after prices were cut by as much as 30 percent. "The volume is very low, considering all the new inventory," agent Drew Fenton is quoted by the Reporter. "My outlook on it is that they still haven't hit their bottom with prices."

Real estate brokers say that developers who counted on droves of wealthy foreign buyers overestimated demand. And it hasn't helped that the decline in residential values has made luxury homes more affordable. "When you think of L.A., you think of swimming pools and views from the house in the hills. You don't think of condos," says Kurt Rappaport, co-founder of the brokerage Westside Estate Agency.

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If there is a project that could be deemed a success so far, it's the Montage Residences, a collection of 20 European-style condos built atop the Montage Beverly Hills hotel. According to industry research firm Mark Co., nine units have been sold at the property, with an average sale price of $2,250 a square foot -- the highest of the new developments.