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As the prices of single-family homes continues to soar, along with homeowners’ equity, people are turning to condos as alternatives or investments.

One project in the Foothills that will put 132 units on the market within the next two years looks to fetch $319,000 for a two-bedroom, 1,074-square-foot condo. A one-bedroom, 765-square-foot model will start at $253,900.

Meanwhile, the average new home price in the Tucson area stands at nearly $430,000 and the average resale home price is $360,000.

Creating condos in Tucson was of high interest in 2005, 2006 and 2007 when the housing market was hot.

Several projects, predominantly downtown, were in varying stages of development when the housing crash brought most of them to a halt.

Data from the Tucson Association of Realtors shows the average sales price for condos and town homes climbed more than 27% in 2021 to $241,692 versus $189,752 in 2020.

Currently, the availability of condos up for sale is less than a month’s worth of inventory.

The Placita Escondida project near River Road and Campbell Avenue, behind St. Philip’s Plaza, involves the renovation of a 72-unit condo complex with plans to add 60 more.

“Our company is a group of Tucson natives, and we wanted to get some more living space in that area with the shopping, restaurants and riverwalk,� said John Jackson, a broker with the project’s developer, Andy Courtney Properties. “We also wanted to create something affordable for that area, at the base of the Foothills.�

The monthly HOA will be $225 a month when the project is built out.

“There are not a lot of condominiums in the Tucson area,� Jackson said.

Records from the city of Tucson commercial plans report the developers are investing about $15,000 in each of the renovated units.

More condos likely

Demand for all types of housing is high, and so is interest in second homes or investment homes, said Randy Rogers, president of the Tucson Association of Realtors.

“With all this equity in homes, people are looking to diversify their income and buy a rental property or second home, and Tucson is so desirable,� he said.

Winter visitors are also attracted to condominiums, and the Placita Escondida project is proof of that — the first 24 units that were finished are sold out.

“There’s a tremendous opportunity for builders,� Rogers said. “I think we’re going to see more condos come online.�

He said there is a buzz about trying to get more owner-occupied dwellings downtown, as most new developments are predominantly rentals.

Monthly rent in new complexes downtown are up in the $3,000-to-$4,000 range.

Rogers said income like that will likely spur some condo development in downtown Tucson in the near future.