If you've got a hankering to live in downtown Chicago and you covet a brand-spanking new condo, this is the year to jump into homeownership.

That's because the pipeline for new projects, once so jammed, isn't just about to slow to a trickle. It's about to shut down, and within two years the resale market will be the only alternative for condo shoppers.

That was one of the many messages that came across loud and clear last week at an industry luncheon about the current and future state of the downtown housing market. The other message was that, by any standard, 2009 was just downright ugly when it comes to condo sales.

This year, six new buildings will be completed and ready for occupancy downtown, bringing 1,200 units to the marketplace. That compares with a record 3,600 new units finished in 2009, according to Appraisal Research Counselors' year-end report.

But in 2011, only two high-end properties, the 86-unit Ritz-Carlton Residences and the 198-unit Lincoln Park 2520, both Lucien Lagrange-designed projects, are scheduled to deliver. As of right now, there are no condominium developments scheduled to be completed in 2012 and beyond.

The firm's survey covers an area bordered by North Avenue, Cermak Road, the Chicago River/Ashland Avenue and Lake Michigan.

How do those numbers compare to what the area has already seen? On average during the past 19 years, 2,400 for-sale units have been added to the market each year.

There were almost 1,900 closings in 2009, which Gail Lissner, an Appraisal Research vice president, labeled as "a really good sign" but much of that likely was for condos put under contract during pre-construction marketing programs. The other piece of good news from the report is that the pace of closings increased from one quarter to the next during 2009.

But it's unclear whether that's a trend that will hold. Only 572 new units were put under contract last year, relatively flat with 2008, and price discounts, aggressive advertising and the federal government's first-time buyer's tax credit are largely thought to have had a hand in generating those sales. Before 2008, the number of contracts written for new construction regularly topped 3,000 units annually.

How many of those 572 will close? The rate of contract fallout — when the deal falls apart either because buyers can't qualify for financing or they simply choose to walk away from their deposits — has been running anywhere between 25 percent and 50 percent. Also, investors have largely tempered their interest for brand-new condos and are instead focusing on foreclosed and short-sale properties.

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