Neo Vertika Short-Sale Becomes a Closed Sale
October 13, 2007 by Lucas Lechuga
The 2 bedroom + den/2 bath loft at Neo Vertika that I wrote about on September 4 closed Wednesday afternoon. The unit has 1,255 square feet of interior space, 20-foot ceilings, a large balcony that extends the length of the unit and comes with the upgraded stainless steel appliance package. Since it has never been lived in before it comes "decorator-ready". This south-facing two-story loft is located on the 29th and 30th floors and overlooks the swimming pool and has obstructed views of Biscayne Bay. The unit was sold as a short-sale so my client was able to acquire it at a great price. The purchase price was $303,800 and the appraisal came in at $445,000.
My client's plan was to rent and hold the unit for around 2-3 years before selling it. However, I have received some interest from people wanting to look at it and possibly acquire it once he closed. I will be showing the unit to all interested parties for the next week or two. After that, my client will install the floors and likely rent it as he had planned.
The best priced D floor plan at Neo Vertika is currently listed at $450,000. My client is willing to sell his unit for $385,000, which would make it priced even better than the smaller, and less desirable, 2 bedroom C floor plan units currently available in the building.
The picture slideshow below will show you unit 2919 at Neo Vertika which is the loft that my client purchased:
I also did a video walk-through of the unit:
The following video will show you the common areas at Neo Vertika. This video was shot about 12 months ago and the common areas were not 100 percent complete at the time.
If you have an interest in viewing this unit and the building in person then contact me to schedule a showing.
And round and round it goes. The original owners are greedy because they won’t lower their sales prices and end up in short sale or foreclosure. No-one has sympathy…but your client wants to flip his Condo for a near 30% profit…
So the “original” price was wrong and it cleared at the $305k level. And yet somehow that price must be wrong too. And appraises for $445. Who cares? More taxes to pay…
We all know real estate isn’t an efficient market but that’s taking the biscuit!
The reason some of these units are going to appraise for higher than the contract price is because the only comps are the older, way-overpriced sales.
The unit is worth what someone is willing to pay for it, not what some appraiser says it’s worth.
If someone was willing to pay $304K for it, then that’s what it is worth right now. Could it go up in price? Sure. But right now, that’s the market value until someone offers more for it.
I can’t stand statements like it sold at X but appraised at 1.5X…No, it appraised at X as that is the value the market commanded. The appraisal is uselesss, especially as BB points out, all the comps are much older. There’s no way you’re going to get a lender who’s going to finance it at a higher price when your client just paid $304K for it. Those days are soooooo summer 2006, not now.
I think you got a great price for your client (240/SF), but I’ll be very interested indeed if he can flip it for $385k. It takes a lot of emotional fortitude in this market to say, okay, this bloke just bought it for $304k, but it’s realllllly worth $385k.
Your client should make out well anyway as a LT investor. What does he think it will rent for?
My impression is that the client is greedy. With so much new stuff coming online, I think that he is dreaming to hope for $385,000.
It’s basically an unfinished unit in a so-so area. It will be interesting to see what happens with condo fees as other owners don’t/ can’t pay fees.
PS. I just read your June 5 post, Lucas, Neo Vertika – Living in a War Zone.
At that time you were projecting assessments within six months and making allegations of shoddy construction.
So things have changed since June? Working for buyers and sellers in the same building is a minefield. Please keep in mind, Lucas, that it is your objective reporting which makes this blog so informative and valuable.
I think the post above was very objective. Nowhere in the post did I say anything like “this is a great deal” or “I think this is worth X amount of money”. Everything that was stated was fact. The appraisal did come in at $445,000. All of the comps were from 2007. I never stated my opinion of value.
JM,
He’ll likely get around $2,000 per month for it once he finishes it off with floors, lighting, window treatments, etc.
I’d be careful about buying in Neo Vertika right now. There are a lot of units listed in the building, and prices have fallen significantly in the past 6 to 12 months. Also, it looks like there have been some fraudulent sales. A similar unit to the one listed here, but on PHII, sold for $575k less than 4 months after the previous owner paid $450k. FYI – the PHII level is at least 30% vacant right now, and probably higher.
Be very careful when you’re looking at comps in this building.
Lucas, I’m going to assume your client doesn’t sell but rents. I’ve done “decorator-ready” and I reckon he will get off cheap (and get cheap) if he pays $30k more and takes three months to get it rentable. Window treatments, as the decorators call them, are incredibly expensive in lofts with 20-foot ceilings. Floors are always expensive. I can’t believe I am saying this, because I do think your client got a good price ($240/SF), but he is going to be cash flow negative for quite a while if he rents it at $2000 a month. And to Bill above,… Read more »
Like I said, his plan was to rent out the unit up until a few weeks before the closing occurred. The only reason why he’s even considering to flip it is because I got a call from a lady who is very interested in possibly buying it. I am showing it to her on Tuesday at 4:30pm. If that amounts to nothing then he’ll likely rent it. The $385K price is negotiable. He’s not expecting somebody to actually pay his asking price.
Oh Lucas, are any of us expecting somebody to pay the asking price? It seems there is no bottom to the market here right now.
It seems like from the posts above that people actually thought that he was expecting $385K. That’s not the case at all. Everything in life is negotiable. He’s definitely not greedy. This is the best priced 2 bedroom in the building. It is being offered at $65,000 less than the next best priced D floor plan in the building. An end-user who is interested in buying a D floor plan might be interested in this unit. That’s why I posted this. I’m not saying that an investor should buy this unit. The numbers don’t work for an investor. An end-user… Read more »