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No bargains here. Show me a new building with a view (not conversion) at $150 per s/f.
Nothing there would cash flow positive with 20% skin in the game.
Click Broker,
Finally people like you are seeing the light.
You call these bargains?! Shit buildings and no views. View?? Club On Brickell???
you said “Show me a new building with a view (not conversion) at $150 per s/f.”
That is not going to happen my friend. I have been saying that for a while and the talking heads on this blog keep predicting that you and the likes can pick a desirable flat in a desirable building with views for pennies on the dollar.
If one wants to pick up a dog house for $150/sf , maybe it will happen. But if you are looking for a decent flat in a good building with at least some views, be prepared to pay $300/sf (down from an all time high of $600) or you can keep waiting.
AJ……. I’m very curious if you think bay view units at Everglades will ever be available at $300/sf. If so, I feel really horrible purchasing a city view unit at about that price point.
Everglades bay facing units will definitely hit $300/sf and probably even lower. Marina Blue has numerous units already at $350-$400/sf asking price and MB is considered by most to be of better quality than Everglades. Let’s not even mention the scandal of Everglades’ developers shortchanging buyers on square footage which will further push prices at Everglades down.
Let’s face it everyone………$150 a sq. ft. is just around the corner.And that will be a luxury suite with VIEW’S.The SMART MONEY is waiting till then and it’s coming FASTER THAT YOU THINK!!!!!
Alan,
Maybe. Maybe not. But do not second guess yourself. You did what you have to at that time and those circumstances.
If bayview units ever hit $300-325/sf in any building, that would be very brief and not long lasting. It also may not be across the board. It will be sporadic and specific to some buildings. IMO that is the absolute bottom for a bayview unit. But you and me very well know that we cannot time that bottom. If we were able to do so we would be gods. Don’t we?
“If bayview units ever hit $300-325/sf in any building, that would be very brief and not long lasting.”
What magic happens at $300 sf? Why that number? Is it the same reasoning that will prevent Google from breaking $400…. Google still is over $400 isn’t it?
JL – AJ is just being a nonsensical pollyanna. All macro econ indicators point down, period. A once in a century over supply combined with lack of financing will continue to drive prices down. Even the NAR says further declines are ahead with no bottom in sight unless the fed govt does something to stabilize prices….well the fed govt can only do so much and is pretty much out of bullets so further declines are ahead. Again, we will know when the bottom comes in when supplies approach 125% of the norm (say 8-9% supply max) which will be close to that pricing. The bottom in pricing will stay for many months and even stagnate at the bottom for years in real dollar terms. There is no rush, there are plenty of “premium” view units, Alan paid too much but that is life and not bad if you have already made the purchase, are living there, don’t plan to move, and it is within your affordability range so as to not be house rich and cash poor. Misery loves company and AJ must be lonely…wonder if he takes requests? How about throwing on some Bruce Springsteen – I’m going down…
http://www.youtube.com/watch?v=ZarmRLa2p9Q
Oh, and more condos are going down down down….one is even gone with The Wind (or at least being foreclosed upon):
Miami’s Wind by Neo condo in foreclosure:
southflorida.bizjournals.com/southflorida/stories/2008/12/01/daily34.html
And Lofts on Clematis (sounds like some sort of disease you’d catch from one of those ladies or if traveling in a 3rd world country) – Lofts on Clematis files for Chapter 11:
southflorida.bizjournals.com/southflorida/stories/2008/12/01/daily33.html
Like from The Matrix “There is no spoon.” well “There is no bottom.” it is all illusion…
RT,
You state…<>
well, there is a govt. proposal to offer 4.5% 30 year mortgages through Fannie and Freddie to qualified new homeowners.
Personally, I believe that is a great plan where the govt. is finally addressing the underlying cause of this entire mess and helping those in need.
I know you are the consummate epitomy of negativity, however, even you must realize that this will provide an excellent opportunity for many to become owners who previously could not afford.
Never in history, could one obtain a 30 year fixed rate at 4.5%.
If this proposal becomes reality, it would be hard to believe that a large part of the inventory would not be absorbed which in turn will stabilize the market.
Now, take a look at your current situation. You love the unit you are renting and this 4.5% mortgage is now available to you. Run the numbers. All of a sudden buying starts looking enticing.
sorry for the ommission in the last post..some reason your quote did not paste.
..you said prices will still decline unless the govt. does something to stabilize prices.
Michael
You fail to include in your analysis that there is probably no way to get those mortgages without 20% down. The days of 100% financing are over and we are getting back to basics (and even overcorrecting as banks just don’t have the money to lend).
So, even if the 4.5% 30 year mortgage is available, a person buying a 2 BR, 1,200 sf condo in Miami at AJ’s suggested “bottom” ($300/sf), would have to come up with $72,000!!!
How many “working class” people do you think can shell out that much coin in this environment?
My guess is that even if they did have it, you have to believe that some are just not willing to commit it when unemployment is growing rapidly and this recession will last a long time.
AJ
Somehow you believe that Economics 101 don’t apply to Miami Condos. Wonder why that is…. At $300/sf and the current rents, none of those buildings even reach break even, but you seem to think that people like to lose money on investments.
the neo wind foreclosure is pretty significant. it’s the first big project to go down. whether others will follow remains to be scene. too bad…it’s not a horrible looking building.
it’s also worth mentioning that the guarantors behind neo are not nearly as wealthy as some of the other high rise players in downtown miami (i.e., leviev and perez) that have new projects coming online.
The Wind is a hardsell with its crazy open no walls floor plans. Most people like defined rooms unless its more authentic loft style. The view will also be gone if building 4 ever gets built on the river.
Michael – The 4.5% mortgages to NEW homeowners (wouldn’t make much of a difference if to all homeowners) is pissing in the wind. It isn’t the creative financing that needs fixing, it is the PRICE. 4.5% will “help” but it is far from a “fix”. It is too little to late and won’t inflate the bubble back. Do you fail to realize what has happened? Their was a credit bubble, not just a housing bubble, that allowed for credit to be extended to people that would never pay back the principal…housing, autos, credit cards….you name it. The principal repayment obligations were allowed to be passed on with a rating that said it was risk free when it wasn’t. The fed govt is throwing home builders a bone to shut them up, it won’t fix things. Those that already qualify will just get a bonus in a lower interest rate and it will only bring in a few marginal buyers into the market….what is the govt going to do, start marketing this as “Buy Now, Offer Expires on 12/31!” then “Interest Rate Sale Extended For Only 10 Days More!”, etc. Meanwhile home prices continue to deflate and buyers continue to wait to buy….. It is going down down down….
Retail sales are now down, down, down…..and commercial retail real estate will begin to get empty empty empty…..
I bet The Wind’s common areas won’t all be open…..perhaps someone can run down to ICAN’T and grab a few pieces of the Alice In Wonderland furniture….
Reducing monthly mortgage payments by one or two hundred a month won’t make much of a difference coming out of a market where credit was extended to people that could even make payments toward the principal….credit was extended already to everyone that needed to buy…..the easy credit created a false demand fueled by speculators too. The willing and able buyer pool is dry.
FYI,
Distressed sale # 4, Skyline unit 1107, has a COMPLETELY UNOBSTRUCTED BAY VIEW. So $255 per sq ft for that unit is a good price. And the unit is not the typical 2/2 that clocks in at 11oo or 120o square feet. It is a more spacious and livable 1367 sq ft. The building is a recent construction (closing in 2005) and is run pretty well. I bought my unit at Skyline during pre-construction in 2002, and I believe that price might be at or below what they were asking for the 07 line at that time. For those of you who enjoy nice amenities, the building has one of the biggest and best gyms I’ve ever seen in a condo, with floor to ceiling glass overlooking the bay. The pool deck is on the water, and it is huge and well maintained. The building has well-priced dock space for those who may own a boat. And lastly, the garage is the most spacious garage I’ve seen in any condo building. All and all, it’s a solid building, and that is a solid waterfront unit.
Condo developers and floplords……throw on the record AJ, all join in now, we can all sing along in The Wind’s common room:
http://www.youtube.com/watch?v=_iDRPJ6TuDs
Michael,
You can get 5% 30 year fixed today from Bank of the West and a few others I’m sure. the extra .5% decline is something like $30 less per month per 100K. That 60 bucks a month is hardly going to help anyone. RT is correct when he says that the lowering of prices is about the only thing that will help. When a nice unit hits $100 per sq ft I’m a buyer as well as many others. Seems like Fall of 09 we’ll start to see it.
#19 – could NOT even make payments on principal.
But probably applies to those that now anyway….
Oh, but the downturn won’t hurt the rich, not…..
http://news.bbc.co.uk/2/hi/programmes/world_news_america/7764066.stm
As cars go so do condos…
Michael,
The new government program seems great at first glance, but what RT says is true. I am a prime example. I’ve got cash, and have access to mortgage at half the going rate (so for 6% rates i can get one at 3%) and i am still unwilling to move. the reason? prices are dropping much faster than the benefit i gain from the lower mortgage rate. mortgage rates are not the issue. its principal that is the issue. new rules in american RE-2B condos are not worth $300k, maybe $200k. AJ is correct for the small number of prime units out there. great views and locations will maintain a nice premium and be reserved for people who can truly afford them. but 90% of the condos are not in this class and are presently being revalued. low interest rates are irrelevent.
Trump University graduates are shaking in their boots. Will rents in Miami fall next?
NYC Apartment Rents Fell in November, Vacancies Rose
If anyone on this blog seriously believes that they can snag a flat in lines 02,04,06,08 and 10 in 50 Biscayne for $325/sf, wake up from your slumber in the fantasy land.
If it ever, EVER goes to that level, there is enough moneyed people in both US and abroad to snap it up in 2 seconds. These flats (at least in the lines I mentioned above) are not made for working class people. A working class couple may not have $7200 leave alone $72,000 for down payment. But there are enough people in this World who can plonk down $360K with out batting an eye for a piece of action in the favourite playground of the World. If these flats ever go down from the current 1/2 million dollars to $360K, they wont be on the shelf for long.
Leave the well to do people aside for a second. For the past 20 years, we (working class people) have been conditioned and grew up in a World where 1 million dollars will not even get you a house worth talking about. $400K will just get you a starter house or flat.
A 2/2 with water views were exclusive domains of the well to do and high fliers. Now due to a once in a century opportunity a working class couple get a chance to live like a CEO for $360K and they will let this pass because they are afraid it might eventually go down to $320K? I think anyone with a little aspiration to live well will take the offer. But unfortunately for the working class couple, before they can put together the financing, the flat will be long snapped up by an all cash buyer.
Hey, fantasize all you want that direct bayviews flats can be had for below $300-325/sf. After all there is no charge for dreaming, yeah.
I just went back and looked at the lines I mentioned above. They are asking an average $525/sf. Can someone kindly post the last few sales in the past couple of months for lines 04,06,08 in 50 Biscayne to put the speculation to rest? Can you also look up any similar sales in lines 03,05,07 and 09 in 1800 club? Thanks
I just want to make one more thing clear. When I said the absolute bottom for the bayview flats in good waterfront buildings to be $300-$325, It does not mean that the prices will settle at those levels. I am only saying that at $325 price point, they become too attractive for anyone and will not last. At $325/sf the premium units are not subject to the recession or financing or other such poor people travails. The point also is that they may never even get to that level.
So please don’t come back in 2010 and spit fire on me saying that ” AJ said the bottom price is $300-325 for a premium unit, I let go a few sale offers at either $350 or $375 /sf and no such deal is coming my way any longer”. You buy when you want and when it becomes attractive for you and affordable for you. If you are not willing to pay a single dime as premium for a premium flat with the fear that it may go down a few more dollars /sf that is your prerogative. You may benefit from being such a hold out or you may not. The fact is to be at peace with your decision and enjoy the flat that you bought. Even though the RE agents have given a bad name to the phrase “once in a life time opportunity”, a sub $350/sf for a premium bayview unit is indeed a once in a lifetime opportunity. It depends on how you look at life whether you agree with me or not.
Let’s revisit this in 6 months shall we aj? For someone earning 26 thousand a year you sure do know a lot about the ultra rich
LMAO. Where did you get the 26k/year! Funny. Anyway I commend you at least for agreeing to wait 6 months to see the results. I am game for it.
At least you are not like that “arse” hole who supposedly has a crystal ball and “knows” everything and talks utter crap all the time.
5/2008 there were 2 sales of 07 line in 1800 club one for 400 k and one for 399k. Hmmm if those sales were to take place after the financial meltdown they would go for significantly less…You paid 400 k and you stand on the precipice….next stop 350 k then 300. You and you partner screwed up vaddi
AJ… I actually like your views, although I believe theye are nonsense. A good blog needs this kind of healthy discussion for it to be valuable.
Now, just 3 things:
1) Do you think that just because people with money (who by the way probably half 30-50% less now than a year ago) are willing to buy a good 2/2 waterview flat just because it’s attractive and it’s now worth less than 6 months ago? People with money generally (not always) are good investors, and this is clearly not a good investment.
2) You make it seem like Miami is the only place for these people to buy a “once in a lifetime” opportunity. First, this is not the only vacation destination and certainly Downtown Miami is far from that. Second, yeah, I guess living in a 500 unit condo next to the one of the busiest sports and concert venues in crappy Miami is one heck of an opportunity. Please
3) I am willing to make a bet if you are…
Hugo,
My views are gathered with an outside perspective, most of my views are shaped and supported by the views of others. It depends on who you talk to.
You and others fail to realize one thing. 90% of this blogs population is not housing bears but wannabe home owners and renters planning to buy. That is the only reason why they are here. They are looking to see how the market is heading and when to strike.
Most of their predictions appear to be wishful thinking more than solid reasoning. It is in their own interest to talk down the market. It has been two years since there is a armageddon predicted on this blog. I yet have to see 50 Biscayne lines 4,6,8 asking less than average $525/sf. So forget about $325/sf, show me when the asking prices hit $400/sf in these lines and I will eat a humble pie. So why don’t you instead of dismissing saying “My views are nonsense” support them with solid proof. At least I support my views with actual numbers.
There are a lot of buyers of ” the world” islands and the burj Dubai that would say an is insane. Dubai is much more the world’s playground than trashy miami . For one I won’t be murdered in the streets in Dubai.
North bay island is filled with much better views and a zero crime rate for 200/ sf and falling!
Who is the president of 50 Biscayne’s condo board? When is their next meeting? 2012?
Yes Hugo, I am willing to bet.
In six months, let us see where the asking prices on lines 4,6,8 in 50 Biscayne.
Right now, it is averaging $525. Maybe you can buy for $450. In 6 months (the absolute peak of the recession and job loss) if the asking price hits $400, you can probably could buy one for $325-$350/sf. That is my absolute bottom prediction (again let me reiterate, it may not even come to that depending on so many other variables. This bottom is assuming every worse prediction to come true regarding economy, job loss, credit freeze etc. But any positive factors along the way such as better and quicker recovery of economy- jobs, earlier thawing of credit, success of the government homeowner bailout program etc will not let this go down to those levels. So we do not know yet).
So if things are different than what you predicted or what I predicted in June 2009, we shall see. Time only will tell.
Dubai Guy,
I have tons of friends living in Dubai and they tell me they want to shoot themselves in the head. If not for the salaries they are getting paid, they don’t want to live in that open air prison. You call Dubai playground? get real, recently a couple got 3 months in jail for coochie cooing on the beach for god sake.
ldk,
North bay village? You are not joking are you? If you are ok with living in NBV, you might be equally happy in Naples or Fort Myers (and for a lot less). Just goes to show that your ideas are completely warped.
AJ,
You may be correct that premium units will never fall to the price others are predicting. Money on the sidelines will always pick those up-regardless of the deal to be had. The big issue people of this country have overlooked is that a $300k mortgage is too expensive for the vast majority of miami and the us population. dont get fooled by the past. people bought properties well above that value, but only because they never intended to live out the mortgage and were assured by the RE establishment they could always resell or refi if money got too tight. those days are over. a $300k mortgage is a major liability in a deflating market with significant unemployment risks. people may well wish they bought the units, but until/if the inflation trigger kicks in, the units are unaffordable for a fiscally responsible person. but as we’ve seen, lots of fiscally irresponsible folks are out there to prove me wrong.
gables,
you are 100% correct. That is a balanced and well thought out piece.
Yes, 300K mortgage is backbreaking for a majority of the populace until and unless a severe recession kicks in.
You are also very right in saying there are a lot of fiscally irresponsible people out there. 99.9% of the popuplation does not read this blog (sorry Lucas, I know that you have the best blog on Miami condos but it is not being read by non RE junkies in a large way). These people do not make an informed decision.
Oops the above line should read “Yes, 300K mortgage is backbreaking for a majority of the populace until and unless a severe inflation (not recession) kicks in.”
can somebody please explain to me what the it means that Wind is going into foreclosure? how does that affect current owners? does it mean the developer owned units are now under new ownership, or does it have an effect on common areas, etc as well? just curious what the actual day to day ramifications of such a situation.
I said a few months back that Wind is the next biggest flop after Opera tower. I did not realize how quickly that came true.
How come there is complete silence about Opera? Does anyone know what is happening to that building as the closings are no more than about 34%? Are the banks foreclosing on Opera or is Tibor managing to keep them at bay by renting all his unsold units? What happened to the talk about a hotel buying 300 units in Opera? Any news. Anyone?
gables
couple of ramifications.
1. the bank is foreclosing on everything that is still covered by its mortgage. haven’t looked at it, but at a minimum, it include all the units which haven’t been sold yet.
2. if the bank goes all the way through with the process, they become the owner of the units. i’m not a condo lawyer, but i have to imagine this will lead to significant association issues, e.g., who is in control of the ass’n, developer liability, etc. my guess is wachovia will make sure they never take possession of the units (maybe have their buyer show up to the actual foreclosure sale and have them bid the agreed upon purchase price).
3. it’s possible you could have a splintered ownership situation, half rental/half condo. suffice to say, that really screws things up. this happened in the 80s with a bunch of buildings in brickell. it was a bloodbath for the banks. as i once posted, the banks were unloading these things for nothing just to avoid the HOA, general unit maintenance and taxes.
generally speaking, this is a really bad thing for those that actually closed. your building now has a scarlet letter. in effect, it’s the vue on a much larger scale. it will take many years for people to recoup their original investment.
Hello readers ,
Does anyone know of an opportunity to purchase bulk condos of distressed, finished or under construction building in Miami? I will appreciate any information or someone on this blog pointing me to the right people. Thank you very much. Please email me at [email protected]
jcrimes,
A few good buildings have hit a wall after closing 70% of the building. Some hit a wall at 50%. If a building is lucky enough to close 66% (2/3rd) or greater, its survival is more or less assured. The developers can manage to ride this storm by renting or other such means if they hold no more than a third of the flats in a building.
I am eagerly anticipating the next condo closing numbers from Lucas. If my fears are justified, there may not be much improvement in the numbers since the last time he posted those numbers. It is suffice to say that any building with less than 50% closings is in trouble.
This response is for Buy sell Miami, I was reading this blog and saw your post. My family and their partners are in the condo conversion business and have several hundred units available in Florida for both bulk purchase. In Miami we have about15 units left in Palmetto Bay near south motors Bmw and another large block in coconut grove near the may fair hotel. Outside of Miami we have several hundred units inthe Orlando sub market areas and Lakeland,Fl as well.
AJ (#27) “For the past 20 years, we (working class people) have been conditioned and grew up in a World where 1 million dollars will not even get you a house worth talking about. $400K will just get you a starter house or flat.”
The average income in the US is $50k/year; in Florida, about 10% lower. Source: http://www.statehealthfacts.org/profileind.jsp?ind=15&rgn=11&cat=1
I assume that working class people earn less than average. I can assure you that working class people do not and cannot afford $400K for a “starter” house, although some may have been deluded into thinking so by shark lenders in 2004.
AJ (#34) “It has been two years since there is [sic] a [sic] armageddon predicted on this blog. ” What would you call the last two years? Boom times? And that was before the shit hit fan in the stock market and the job market.
This is not a personal attack. I invite you to respond, explaining your position.
AJ
not really. renting the remaining units should cover the debt service however, the reality is that the loan is coming due, not twenty years from now, but in most cases, a few months. banks are under extreme pressue to be transparent about the status of these loans, both with the public as well as the fdic and ots, thus they’re compelled to classify them as in default (if you know that the balloon won’t get paid, then it triggers your defaulted loan reporting requirements). once you’re in default mode, the banks needs to push on the foreclosure front and boot your ass. i’m not saying forebearance and workouts don’t happen. i’ve done several in the past year. however, there needs to be a light at the end of the tunnel in a short timeframe…lenders can’t give developers years. and i can tell you now, for many projects, the simple issue is there is no light, i.e., sales, on the horizon.
Buy Sell
Call Ocean Bank.
Buy Sell,
Why should I call Ocean Bank?
jamie,
I am talking in general. Try and buy a starter home in greater NY metropolitan area for 400K and you will know what you can get. A shack maybe. Even in Florida, Just go to maimi shores, biscayne park, El portal and see what you can get for 400K. Absolute crap shit. And I am not even talking about grove or gables. Agreed, a SFH in Miami shores should drop further but as of now, two years into thid doo doo, you still cant get a decent home in Miami Shores for 400K.
Well, this is not armageddon. This is a downturn. Armageddon is when premium flats in Miami dip below $300/sf and all others dip below $150/sf across the board (not just foreclosures and distress sales but across the board)
If that really ever happens as per the wishes of the many here, you don’t even want to imagine the consequences. But thankfully, that is not going to happen. I can say that not because I have a crystal ball but because I have faith in America.
jcrimes,
re: post 51.
Thanks very much. It is greatly appreciated. Would you happen to know what projects does Ocean Bank have? If anything additional comes to your mind, please let me know.
Best,
Buy Sell MIA
AJ (#53) Thank you for responding, and with unusual restraint!
We disagree. That’s all there is to it. Hey, honorable people can and do. “Armageddon” is a relative term. I believe we are about to enter six months of economic hell. You don’t. I’m not offering a bet on that.
Since this blog focuses on Miami condos, not single family homes, I have to ask: How do we clear the market of a huge oversupply of upmarket condos? Economics 101.
We’re coming at this from different positions. I am bearish on the Miami market. You’re a professional DJ who, if you make enough money to own two condos in Miami and one in NY, must be great at your job. I just wonder if the people whose parties you cater are representative of the average Miami buyer. I think not. Go ahead and disagree. It’s allowed!
Agreed this is not armageddon. but this is more than a downturn. a year from now, we will operate in an entirely different financial climate than the past 5 years. you are witnessing the type of shift in culture and economy like was seen during the depression. we will survive, and many will be quite successful while others (say 20%) will really be hurt. the days of $400k average homes is gone in the miami area except in certain upscale areas. people will not have access to excess credit like the past 10 years. this will have significant changes on the economy.
further, unless the govt continues to intervene and muck up the markets, we will witness a transfer of wealth between generations which was unimaginable a decade ago. baby boomers have lost by far the most in the past year and this will continue in the coming years. these folks have the largest 401k’s and most expensive homes (many with debt from home equity loans). both assets have been cut in half, and unless the govt bails them out at the younger generations expense, baby boomers will soon come to the harsh realization that the retirement years will not be full of world travels and dinner out as imagined. problem is, many baby boomers control the legislation, and may distort this correction to their benefit. time will tell.
@Ender Korkmax (#57) Who’d have thought that was a real name? So your family owns hundreds of units here. I wonder, abstractly, if that makes you really rich or really poor. However this post has nothing to do with that.
I read your profile on a site. To put it kindly, your grammar and spelling could use some work if you are trying to present yourself as a guru. I set up a yahoo account – korkmazender at yahoo, and if you email me there, I will send you an edited version of your ad. Free.
NSA.
gables, your #56 absolutely spot on. Oh those baby boomers. People have a love-hate relationship with them. After all they are your mothers and fathers.
Jamie,
I am always blogging with restraint unless provoked to a point. My language maybe colorful but I do not individually attack or insult anyone unless they do that first.
Your oversupply will become short supply in 4 years. Mark my words, by 2013 not a single flat will be left unsold (for what ever the price). Combine that with the fact that nothing is on the drawing board and nothing else will be coming on line until 2016 0r 2017 (provided they start building again in 2013-2014), it will be a completely different story then.
No, the people I cater to are not the average Miami condo buyers. I do not talk to them anything personal financial.
Probably you do not read the blog regularly. Couple of threads ago I said 2 of my props are aquired during the time I was the Ops. manager for the port of NY-NJ. Unless you are DJ Tiesto, you cant be that lavish.
AJ (#58) Do you know what I get when I enter “Operations manager Port NJ NYC DJ real estate” on Google? I’ll tell you. A 49-year-old balding male DJ from New Jersey. That’s what. Name Joe Kahwaty on My Space.
Care to deny?
That is not me.
In any case why are you searching for me. I am not that important.
The taxes on the Skyline prop is $1000/month on an assessed value of 525K. How long would it take to reassess this at 349K?
Also question to GT3. Do you know the maintenance on this unit? Is that in the range of $ 700? If so, together it is very steep. Nice view of the Rickenbacker causeway though.
AJ, I just took the info you offered and googled. Port, NY/NJ, real estate, DJ. Bingo. How many people fit this profile? One. It zoomed in on your MySpace. Where you happen to be a bald 49-year-old wanna be DJ.
I searched Miami-Dade records for the two condos you say you own here. They are not in your name.
I suggest you stop posting. You’re a fake.
Wow, Jamie has no life
Have you guys heard of any good deals going on at Ten Museum Park or 900 Biscayne any forclosures or short sales going on
Ender, wtf do you mean I have no life? I just exposed one of the more prolific posters here as not a 20-something DJ but a sad sack from NJ. And I did this in ten minutes. I guess you’re not going to take me up on my offer to correct your website for free. That makes you kinda – um, stupid.
Well if thats the case, then thats a different story, and I would have to apologize, my understanding was that you were trying to mock me and my grammar. My post was geared for (buy & sell) who had a question about bulk sales.
jamie,
really dude( I assume you are one), I had a good laugh. Keep on entertaining us. I hope you dont look as stupid as you sound!
hmm. let me see, I was called a RE agent, a developer, a balding wanabe DJ from NJ… keep it coming. I am lovin it.
@ender – If you read my post, I offered to correct the grammar for free. I’ve no idea why you think I wanted to mock you. I am genuinely curious if your family is rich or poor. Anyway, see prior post on how to contact me. I’m quite serious – free edit. Take it or take it not.
Well to be quite honest I think we were doing ok for ourselves when compared to others who have declared bankruptcy, the developement business is not our primary business ass we are primarily in air conditioning, (manufacturing, distributing, e-tail) we got into the development business back in 03 when anything you put a for sale sign on sold dispite the price. The units that we have left over were paid off but then re mortaged in order to purchase other units in one case at 49k a / door with the intent to condo convert. The majority of the other units are interest my family partners have that sadly suffered. Iam not sure what you consider rich but we live a decent life style but still have alot of debt like most people do. Think like this most people you see living a really nice life style still have a nice amount of debt
@aj #67:
“I was the Ops. manager for the port of NY-NJ”
That’s from you. That’s a unique job. Cross-ref it w/DJ, and sorry, dude, I believe you are who I said you were.
A fake civil servant who wanted to sound 20 years younger than you are. You have my pity.
Jaime,
That cannot be AJ’s site. No way he could have a website and resist a plug for Margaret Pace Park. His condos are great, and given a public forum, he simply is not capable of containing himself about them.
@ender#69: That is possibly the most honest post I have read in two years. And the most intelligent. Email me at the address I posted. I think I can help, and if I can’t, it’s free.
gee, I’m honored guys. Every other reference in this blog is to me. I am really glad to be a thorn in your neck.
Psst Jamie, actually Jorge Perez is my Cuz. shhh! Don’t tell anyone.
You love this, don’t you? In your honor, I’m not going to refer to you again. I think you are stupid.
Its fine, dont worry about it, thank you though, that stuff you found on live person was me messing around with the site, I use one of those live chat services from live person for my site and one day while checking my account was figuring out what happend to the site as it seemed to of disapeared and replaced with some social networking money making concept. Live person which does the live chat software for companies like ebay i guess decided to come up with a concept using live chat software to sell peoples skills, (kind of like a linkedin but with transactions) I was just figuring out how to access my existing account and in the process made an account to ” to sell my services as a business guru” for the hell of it but I dont really expect something serious from it, but thank you for your offer though
so who exactly is the moderator here, This is my second day on this site
Good choice of action. Proves that jamie is growing up. Finally time to stop breast feeding.
One parting shot kiddo. Take it as a piece of education.
You have absolutely no idea of music business. The biggest names in The DJ World are never in their 20’s. A 20 something DJ is someone playing Macarena and Chicken Dance in some 12 year olds birthday party. Most serious bigtime DJ’s are in their 30’s and 40’s. Some like Danny Tenaglia, Junior Vasquesz etc are in their 50’s. Everyone thinks they can be a DJ. It takes 10-15 years to mature as a good DJ (provided you have it in you to start with) while you can accurately read the crowd, experiment with more than 40 different dance genres from around the World, Sample music & Produce your own mixes.
Have a good night. Your brain must be spinning already like a record!
Ender,
The owner of this blog is Lucas and you can call him a moderator of sorts. He does not censor or edit posts unless they really cross the line. Mostly everyone follows a certain code of conduct. Once in a while things get out of control. But it is the USP of this blog and it worked well for 2 years. Anyone who is planning to buy a flat in Miami should watch this site for at least a couple of months before deciding. They will benefit from the experience and Knowledge.
Sounds cool, so your a Dj, is this in Miami or in NJ couldnt really understand from the posts
NYC.
I want to play in Miami but that town has no money to offer. Poor bastards. All flash and no substance.
lol well I would think miami does as its big on night life and events, but then again maybe because theirs so many venues and clubs, theirs also alot of dj’s as well (supply and Demand perhaps)
Jamie,
AJ isn’t wonderbread white so that’s probably wrong and the myspace guy is spinning Bruce Springsteen which is outlawed in Dade County.
PS, if you check the cached version of your search, you’ll see that several of your key terms were triggered by page phrases that are not relevant.
“Operations manager Port NJ NYC DJ real estate”
ie.
“operations”- Party Rental Operations, Special
“port”- Township Ocean Township Ocean Port Red Bank Roosevelt Rumson
“real estate”- poster called Dependable Real Estate Agents
Thank god we have a few saner elements on this blog
JL ,
thanks for letting me know that Bruce is banned in Dade. Not that I would play Bruce as that is not the Genre I play anyway.
Ender,
It is not about supply and demand. For some reason the club owners don’t pay. They are cheapos. But it also shows up in the talent and the equipment. On my last visit I attended the grand re opening party of Crunch gym and they had the drinks, the babes, the bods and the 9 yards. But the DJ absolutely sucked. I employ 7 DJ’s and the worst of my lot is still 10 times better than that Miami DJ. There is only one DJ from Miami who I really appreciate. That is DJ Jarell. He plays excellent House, Tribal and Electro.
Anyway I can see some grumbling already that this is a housing blog.
K. Last post. Tomorrow business as usual.
Buy Sell
Not sure which projects, but suffice to say, they have a lot of foreclosure activity going on. They’re definitely trying to avoid taking possession of all the stuff they’re foreclosing on, and with the FDIC breathing down their neck, they’re doing a good job of moving inventory. I’d call their special assets dep’ts and ask for one of the senior v.p.’s there.
Can you guys let AJ be? Damn. I disagree with 95% of what he says. Simple maxim to live by in life – crush the argument, not the person (unless it’s Kramer…then ad hominem attackes are not only acceptable, but encouraged).
Man oh man that picture of AJ is hilarious!!! I figured he’d have some hair but bald fat and over the hill is just too precious and pathetic. You must have been spinning those records a long time AJ. Didn’t VJ’s first appear on MTV in the early 1980’s?
Are you guys going to start talking about RE or the authenticity of a poster?
I don’t respond much but I do like to read the content and it just went to crap.
Thx
OK lets put this into perspective. The Auto companies are facing bankruptcy, auto sales are at their lowest in 26 years, most people cannot get an auto loan. Dealers are closing up shop before going into bankruptcy. So we should all go down to Williamson Cadillac and offer to by a new car for 20 cents on the dollar. Think about……..So why would the developers sell at 20 cents on the dollar?
There are billions waiting on the sidelines to come in and take over so called distressed developments, the developers now this and they also know that most banks do not want to foreclose. f you have a development South of the 395 all the way down Brickell to around 14 street, you will be OK there continues to be demand even if it is only in rentals, the infrastructure continues to come. Bring in some high end retailers and you will have the Champs Y lysse. So if you are waiting for the bottom to drop out you will have a long wait.
Birckell Ave as the Champs Elysses hahaha. That is the best one I have heard all day.
right…..
APOINTOFVIEW – Well, if you paid X and can only sell or rent at 50% of X, you are not OK.
APOINTOFVIEW….
a fundamental flaw in your reasoning is that you entirely ignore the cost to carry. holding hard assets costs money. in the case of your caddy example, the dealership has to pay taxes, utilities, employees etc. they also committed to purchasing new vehicles and have to pay money for their floor financing.
if the holder can’t cover, sorry, but he’s losing it. the banks have all the motivation in the world to take their losses now. the question becomes the clearing price…which you seem to indirectly allude to in your post. what you don’t know about the billions of dollars in vulture funds sitting on the sideline is that their view of what they want to purchase is exactly what you say is an absurd price – 20 cents on the dollar (what was lonestar’s price for the merrill assets?). i’ve sat on enough calls and deals where the terms were so onerous that the developer said no…i’m sticking around. problem is, the end is near for these guys. there simply is no further exit strategy for projects that have no equity in them and significant cost outlays to boot. 2009 is the year of judgment for the developers.
most of the developers are caught in a psychological dilema. the prudent move for possible survival, but still with significant risk of failing in the future, is to unload the assets immediately if the carrying costs will lead you to ruin anyway. problem is this is an admission of failure-tought for arrogant, hard headed businessmen to fess up to. much easier to be foreclosed upon-blame the bank for your failings instead. until recently, banks faced the same dilema with the REO properties which they refused to unload at low price. this path usually leads to failure anyway. have you noticed this blame game with auto execs recently? no mention of having poor business models and overpriced products (in todays world we should not be paying over $20k for a vehicle). but lots of talk of failure due to unprecedented financial credit crisis. the crisis exists, but only hurts you if your business model is screwed up like the auto world.
just a scary thought on todays economic news. terrible unemployment numbers to be sure-largest drop in about 35 years i understand. but some people are saying this is a good sign, since this will be the catharsis we need to turn the ship around. problem is this number matches the losses from 35 years ago, when it represented a much larger percentage of the employment world. we will need to significantly exceed the magnitude of unemployed from the 1974 collapse before we reach the turning point now. we have a much larger work force today. if the crisis is as bad as all of the government intervention indicates, these numbers will get much worse before things get better. RE and condo purchases with large amounts of debt still seems to be a very shaky proposition in my mind.
Foreclosures aren’t even at the halfway point yet, credit remains very tight, and unemployment is shooting up. Somehow, you combine that with an historic oversupply in condos, and well, prices will need to come down substantially more. I just don’t see stabilization on the horizon. As I mentioned, I recently passed on a “great deal”……10% more of a reduction and I’d probably be a sucker and bite….but if the end still remains out of sight, then again, probably would wait. Just when you think a bottom is coming it isn’t.
APOINTOFVIEW
While banks don’t want to go through the hassle of foreclosing, they might sell the note to an investor that is willing to go through this process. This way, they are get some portion of the value of the note back today.
Any idea how much is the maintenance on the Skyline apartment 1107?
There is currently a most excellent unit for rent at 1800 Club with bay views in the 09 line for rent for $2100. No takers! Are these people absolutely mad? Do they not realize how splendidly appointed these units are? There is a second unit in the 09 line at $2200 with no takers. Oh my, these people are such uncouth barbarians. How dare they turn down such a magnificent offer….this is sacrilege!
Another Friday, another bank failure…Still trying to figure out why Georgia gets hit so much? Guess a lot of local fraud there.
But Renter Tom! What about the fabulously appointed units in 1800 biscayne? Do you think the the conglomeration of rich people worldwide would dare allow these wonderfully appointed units to sit on the market and perhaps, dare I say, drop in price to the point where mere mortals can rent them???
Testing. I seem to have been banned.
Which would make AJ, the 49-year-old fraud, happy.
Splendid Fabulous – The problem is there are now fewer of these rich people and many have better things to spend their money on. Even better yet, the wealthy (as opposed to the rich) will spend their money on assets that will pay an income and/or at least appreciate above the rate of inflation (or at lease deflate less than average), hence, they will wait for the bottom if they are in the market for real estate.
I would agree with many of you on several points, while yes vulture funds are ready to attack,their not doing so unless its 30-50 cents on the dollar depending on the fund. Another issue is that banks while they may allow the developer to release a certain amount of units at a discounted rate, it may be a small portion and not the majority of the development and not always at the price these funds are willing to barter for. At the end of the day, cash is king however if you are ready to move fast and can put some hard money down not contingent to finacing and may be willing to pickup several blocks at a moments notice, banks may allow developers to release units at increadible bargains, but again these numbers are not the ones the average joe can get them for In one case for example their is a developer I know that is being pushed to sell his units desperalty and has given him a certain time frame before they take matters into their own hands. The apraised value on the block of some 200-300 some odd units is about 22 million. If someone were to come with about 8-9 million cash maybe less before the end of this month they can walk away with 22 million in real estate.an incredible deal with huge upside and cash flow however funds need to be avaialbe asap. so these are some of the issues but they do exist.
Well, I must say that the units in 1800 club with the direct bay views are absolutely to die for! I often sit and eat Grey Poupon from my balcony just drinking in that view. It brings me to tears that the non wealthy can have such a splendidly appointed unit for a mere $2100 or maybe much less. Is there no justice in this world?
You would at least agree with that view (pun intended), correct renter tom? Oh dear, I have made a funny!
The Smart Money prediction: $125 per square foot.
Vue at Brickell – On Nov 18, 2008 $122 per square foot.
The Smart Money apologizes for being wrong.
Splendid,
Please refer to the apartments as “flats”. Flats are so elegant in the building where my mate lives. I wish I could buy one of those flats. I would spend hours in my flat gazing at the park where all the tramps sleep and people with flats in brickell come to walk their dogs and wish they could buy a flat in my area. Life would be good with a flat in my hood. Cherrio
Previously people here have asked for updates on my Everglades purchase.
Lucas
Attorney’s
Appraisers
Realtors
I purchased a pre-construction 2 bdrm unit at Everglades On the Bay in 2004 on a relatively high floor with direct east unobstructed water and Bayfront park views for $400. per sq ft. All of the brochures and literature provided me stated the square footage as – ” 1195 sq feet of A/C Living Space “. When the developer recently sent me my closing date with new amended condo docs – the new docs for the very first time indicated in print that the square footage on my apartment was now 1058 sq. feet. When questioned by the developer – first there would be no price concessions for this “slippage” in sq feet – and secondly below is their written explanation for the discrepancy. My question here is asking the opinion of experts here whether this in their opininion is a valid explanation. And finally if the Florida Administrative Code was indeed changed in 2006 – then what was the Florida Statute Code requirement for measuring the square footage prior to 2006 if any? And did ALL developers prior to 2006 use this BOMA method to determine and advertise their products sq. footage- as claimed by Everglades developer. Or has everyone along the Biscayne and brickell corridor been deceived with false and misleading promotion of square footage. Has anyone in Plaza-Quantum – One Miami – 1800 – 50 biscayne – Marina Blue – 900 Biscayne measured their units and finally are we paying property taxes on the advertised sq footage or the actual square footage per the changed Florida Administrative Code now required by the state? Below is Everglades “Legal Square Footage Explanation”.
The unit is the exact same unit as was sold to you. There were no changes to the unit. There were no changes to the plans. In 2004 when you purchased, every developer and every unit was measured under the BOMA (Business Owners and Managers Association) standard. That standard was the established method of measurement used by everyone.
In 2006, the Division of Condominiums amended the Florida Administrative Code by creating Section 61B-18.0051, which required that all developers now measure units in accordance with a standard which is the definition of the unit as described in the condominium documents. Since the documents define the unit as the airspace within the exterior box, the numbers changed because the BOMA standard includes the walls to the middle of the adjoining wall and the new legislated Division defenition does not allow for such inclusion.
The courts have already ruled that the defenition of material and adverse is for things initiated and created by the developer, not things that occur and are beyond the control of the developer. A statutory change such as this was not initiated by the developer and was certainly beyond its control. Nevertheless, the developer must comply with such revision to the law and as such was required to change the numbers of the square footage of the units. Again, no changes to the unit, the floor plan or the plans were made by the developer. It is the exact same as what was shown and provided to buyers.
EBK – Your numbers suggest a value (using 250 units) of $88,000 and liqidation value of $34,000. What are you referring to talking about…a cheap apartment to condo conversion?
Hey jamie. Check your email.
Clark and others……….If what this letter states is true how does Everglades account for this: My condo docs from 2004 and the updated docs (2008) both have the architectural layouts of all the units with similar notes next to it, one of which reads “The perimetrical boundary of each unit shall be the vertical plane of the interior undecorated unfinished surface of the walls, lying within the upper and lower boundary of each unit”. In other words it seems to me that the units were measured, then & now, in the same manner. Doesn’t this completely contradict Everglade’s letter of explanation?
Clark
I’d push and I’d push back hard. This is egregious. The simple fact is, your expectation was 1195 sq/ft. You’re not getting 1195 sq ft. The developer”s statutory argument on this particular issue has not been litigated and all it takes for them is to lose on one of these contracts and their screwed on a massive scale. If you need a referral to counsel who handles these types of cases, I can give you a couple of names offline. Just give me an e-mail address.
Clark…….. I’m attempting to get out of my Everglades contract. Would like to contact you. What’s your Email?
jcrimes……..I’m guessing your an attorney. What do you make of my post, #111?
Clark,
The best way to check is to see if the interior dimentions of the bedrooms (the most square of all the rooms) are the same in physical reality as given to you in the brochure when you first purchased. If so, then it is just readjustment or reinterpretation of the area and no actual physical reduction in area.
Before you waste your time with lawyers and courts you should confirm this. If Cabi’s explanation is indeed true you cannot fight them in court.
The actual physical area (under a/c) is so freely interpreted by so many. For example, if you see the sale ads for Waverly or Floridian, the units in the same line are advertised with different sq footage. When I asked a realtor what is the reason for all this discrepancy, he said there are many ways to interpret the interior sq. footage!!!
On other news McLatchy is up for sale. Even the Terra deal might not happen. They have 25 days left to go to close. Walmart and City Sq. are non starters, it looks like.
LQQKS like “THE ACE” did it again with his predictions.I think he OVER ESTIMATED .I wonder if he’s going to readjust his per sq. ft. price for 2009???COME ON ACE……..do it again!!!!!!!!!!!!!!!!!
Regarding square footage measurements, it is the oldest trick in the book. I am aware of a class action lawsuit in Ft. Lauderdale against developers of Las Olas River House. Apparently when one owner had floors measured the flooring contractor informed her that the unit was 2100 sq ft, not 2600. Brokers today STILL are quoting the old square footage numbers on resales.
I am in a new building in Boston. The developers did the same to me, but the purchase agreement gave them 2% variance. In another deal I was negotiating, my atty stipulated that we would be reimbursed on any measurement adjustment and developer refused to sign the deal. They know what they are doing from day 1.
I hate to disagree, but I don’t want to put out false hopes and jcrimes is probably right that you can push it to get negotiate something….but, the explanation that the developer provided is acceptable. You are getting the same product and it is not uncommon on blueprints and other plans to specify how the s.f. was caluculated…from the inside of the walls or midpoint. Most give midpoint of common walls…..esp if common walls but some go all out to include the full wall in s.f. of non-shared walls. If the room dimensions haven’t changed then I think you are out of luck since it is just a regulatory matter not change in reality. The other point that regarding a description of the unit via vertical planes etc. addressed boundaries and is not directly related to s.f. as calculated via midpoint or inside wall so that is a nonissue and will be grasping at straws. The architectural calculation is just that and there are several ways to make acceptable measurements and if a new standard is now being used, it doesn’t change the reality. Sorry…just my opinion, don’t shoot the messenger please… 🙂
jcrimes
Thanks. yes please e-mail with names of counsel who handle these types of cases – [email protected]. Thanks in advance.
Yes renter tom but – how does them even measuring to the mid-point of the walls account for a decrease of 140 sq feet on a 1195 sq foot apartment You cant lose that amount even if you measure according to those standards.
There is not several ways to make acceptable measurements – according to the 2006 change in statue.. Maybe you mis-calculate 10 – 20 – 30 sq feet but not 140. besides in Alans case he lost 200 sq feet on an 1186 sq foot apartment.
In 1800 Club, when we measured the interior space for flooring, the interior dimentioned mentioned in the floor plan are in exact confirmation with actual measurements. So I can say that in that building, the measurements are starting from the walls and not from a midpoint of the common wall. In effect the 1222 sf 2/2 is infact 1222 sf and no less.
But as others have pointed out, some measurements start from the midpoint of the common wall and so the actual physical measurements will be short of what is in the floor plan. I don’t know if this is legal or what.
My question is, did Everglades first declared the sf using the mid point of the common wall there by ending up with 1195 sf but then due to new standardised regulations they are forced to measure them from the wall itself thereby reducing the sf to 1058.
If it is so, then you have always bought 1058 sf and you thought it was 1195 due to a marketing gimmick and the worse thing is it may have been legal all along. Apart from 1800 Club I do not know how which other buildings measured the sf from the walls instead of the midpoint of common wall. This is a good info and people living in different buildings should pull out their floor plans and see if their bedrooms are as declared in the floor plan or they are 6 inches to 12 inches shorter. If shorter, then their living space (under a/c) is shorter than what they think it is.
Jaime check your email.
An you are wrong. Your 1222 sq feet is actually 934.
Aj
AJ…..please look at my post #111. In the case of Everglades the ’04 contract did not list the square footages of the units. Only the sales brochure did. When one takes the informaton from the brochure (1186 sq ft) & the info. from the condo doc saying the boundary is the interior wall surface you are led to believe that this is the actual sq footage, from inside wall to inside wall, not to the middle of the shared walls. As others have noted on this blog, less than 1000 sq. ft. is considered cramped for space for a 2BR/2B. (Technically this is being called a 1Bedroom, 1 den & 2bath). I feel deceived.
Sir JA (#106): You’re just AJ again. You consistently use fake brit-speak. You are the only poster here who refers to condos or apartments as “flats” and uses the term “arsehole.” Please go away. You don’t own condos in Miami and by your own admission can’t get work here. I regret that I exposed you, it was not a nice thing to do. I’ve always been honest here – losing money on the condo I bought, frank about what I would face as both a landlord and tenant (more losses for both parties). The blog is getting bigger, which is great, but I don’t think AJ contributes anything. There are several posts above that do (none of mine, except perhaps persuading AJ and other readers that his time has come and gone.)
World traveller (#110): Which email?
I would like to say that I am not proud of my posts on this comment. I was annoyed at AJ’s comments, which I thought lowered the usefulness of the blog. I misbehaved. I regret it.
Alan, I disagree. I own a 950SF 2/2 with eight windows. It’s not a 1BR, den, and two baths. Both bedrooms have two windows. It is technically and any other term you care to use, a 2/2. Sure, it’s small. But it is definitely a 2/2.
And, oh how I wish I could sell it!
@world traveller (#110, #123) Sorry. You were apparently talking to a Jaime, not a Jamie.
Watch out for the 1800 Club.
Jamie, Korkmazender at yahoo. Check it
They way to fin out the real sq feet is to look at tax records…. 1800 gives measurements that Are false
@worlld traveller (#130) No email. I misspelled the guy’s name on purpose. The address you mentioned is correct. Try again.
Alan
a long time ago I was. not sure what to make of the language…it’s all gibberish to me.
RT
i’m just surpridsed that it lead to such a dramatic decrease in size. i mean really, 100sq ft plus change?
Clark
do you have your original sales contract? what’s it say about the size of the unit and language re: unit size and changes to it?
jcrimes,
re:post 84, thank you very much. Your suggestions have been very helpful.
jcrimes……The original contract did not list the sq. footages of the units. The sales brochure did. The brochure states that dimensions are approximate. But that shouldn’t get them off the hook for large changes. If you’re surprised, as you say, with a 100 sq ft plus change, then you will be shocked when I tell you I believe I lost over 200 sq ft.
Check your spam. From an @yahoo.com address
@ World traveller (#136). I got your email. I responded to it. We can disagree, can’t we?
To everyone else, including Lucas (who is probably happy about his page views): Let’s go back to talking about Miami condos. That’s what we’re here for, and I appreciate what I learn here.
If you miss one payment it’s out on your arse! Don’t you dare miss a payment on a luxuriously appointed flat in brickell! I sit in my flat and just DRINK IN THE VIEW! To all you plebs I say stop dreaming of my fabulously appointed flat with direct bay views on a high floor with an odd room number which the sun shines on at a 35 degree angle in january at less than $300/sf! Only a unit that fits this criteria is worthy of being considered fabulously appointed. I scoff at any flat not fitting my criteria! Let them eat cake!
re: Everglades, Alan said “jcrimes……The original contract did not list the sq. footages of the units. The sales brochure did. The brochure states that dimensions are approximate”
—-
This sounds nuts. You were signing a contract for a unit that did not state square footage in the contract, but rather on a separate marketing brochure that states approx. dimensions? Sq. footage has to be in the contract somewhere or a lawyer would have flagged it -I would hope-.
P.S. regarding accurate standardized sq. footage measurements. I believe tax records are the standard. As was mentioned earlier about the Riverhouse in Fort lauderdale, you tend to see 2 different sq footage measurements in ads for the same lines. 1 is from some marketing brochure and the other is the # that is stated in the tax records (which is often about 8%+/- less).
Clark, any way around it you were screwed. There is a reason that they present the new number just before closing- they hope that you’ll miss it. Also, many buyers don’t read their documents- shame on them. The BOMA method changed in 2006– it took two years for them to tell you? My developer makes a distinction between the “marketing plans” and “building plans.” The preconstruction square footage is always higher in order to understate the cost per square foot.
The tax records reflect master deeds- that is why they are accurate.
Check your contracts. Good luck.
JL……I understand your sentiment that it sounds nuts that the sq. footage isn’t in my original Everglades contract. But it isn’t. Clark also attested to this regarding his Everglades documents. You might also be surprised to learn that other things a buyer might like to know about what they are getting with their condo purchase are also not in the condo docs, such as the type (brand) of kitchen appliances, the ceiling heights, the type of bathroom tub (with whirpool jets or not), etc. The brochure was the only thing I had to go by as far as the square footage is concerned. I purchased my unit almost 5 years ago & had been imagining, for all these years, how wonderfully
‘spacious’ it would be, only to find out just prior to closing that it wouldn’t be spacious at all (IMO). Furthermore, Bill P makes a valid point-why didn’t they notify me back in ’06 about the change in measuring unit sizes? Also JL…..this is a lot more than a 8% change; it’s more like 17%, maybe greater.
Alan,
I am seeing your point. Measuring within inner boundaries and measuring between the midpoint of the common wall will result in some difference in sq. footage but should not result in 100-200 sf of difference. After all the seperating walls are so thin. You might have a case here. But enlisting the help of a professional such as an architect to find exactly how much is the interior sf might make your case stronger or at least answer your Q. By the way when are they going to let you in to take a look before closing?
I also agree that anything less than 1100 sf is a very cramped 2/2 (at least by Miami standards, in NYC they manage to make 2/1’s in as little as 650 sf). Opera tried to make a 2/2 in 1050 sf. Add to it the curvature of the building and it turned out to be utterly disastrous with pocket doors and bed spaces instead of bedrooms.
I may also suggest Alan, Clark and others about to close in Everglades to jointly hire an architect to get a few sample flats measured, read and decode Section 61B-18.0051 and give you an expert opinion. Then you can decide to hire an attorney to get out of your contracts or at least pay for 150-200 sf less(??) (Hiring A General contractor to professionally measure the area may not be of help as they are not familiar with Section 61B-18.0051 or its ramifications). Split between all of you, hiring a competent architect for a day should’nt cost you much.
renter tom, in reference to what you posted above last I remembered doing the calcualtion it came to about 40k a unit.
If anyone is interested in in bulk buying I have up to 15 condo converted no expense spaired units left in the grove feet away from coco walk were the new luxury muvico theaters with valet parking and propsed high end bowling alley will go. These are on Virginia street right by the mayfair hotel and cocowalk. It takes longer to park your car in the coco walk garage then to walk by foot it also a short walk to montys and all the parks in the grove by the water. From my understanding their arent any prices remotley near this for units in the area . All unts come with stainless steel appliances impact glass, granite counter tops and wood floors. the development is gated and has a mediterranean design.
prices are as follows
1/1 160K orignial price range 230K quantity 1
2/1 185K origial price range 270K quantity 4
2/2 195K orignial price range 300K quantity 7
My family developed it and these are some of the last units that are left. and not advertised, im just giving them a hand as they need the cash flow.
let me know if anyone is interested.
AJ,
Debt no longer equals wealth. LOL!
It is hilarious to read you calling people poor, when you are one renter away from a cascade of forclosures.
I would rather be broke and debt free then in your position any day. You are worse than broke.
You are all missing the point here, the chap that paid $400 per square foot should not be worried because the developer chiseled him out of 100 square feet or so as what is a lousy 100 square foot between friends.
The point you are all missing is the fact that he paid $400 per square foot and had he listened the The Smart Money back when he purchased he would have realized that the developer was chiseling him for $275.00 per square foot ($400 verses the $125 that we the Smart Money pays = $275) regardless of the footage, now that’s not chump change you chumps!
The Smart Monies prediction for 2009 remains the same: $125.00 per square foot and should the price drop below $125 please except The Smart Monies apologies in advance.
The Smart Money
To all you little plebs: stop pleasuring yourselves to the thought of my stainless steel refridgerator! My flat has only the finest luxury appliances! I have travelled the world on a luxury yacht known as the dawn treader. I have seen all 194 countries and 7 continents including Vatican city and Kosovo! Do you know what even the polar bears of the arctic circle have told me? They have whispered to me that splendidly appointed flats in the worlds playground Miami fitting my isoteric criteria will never fall below $300/sf
Esoteric, excuse me
Looks like the barking dogs are finally getting trained. All it takes is a few belt whips on the hind legs or an electric shock collar. Good Boy!
Fearful Moron Chris,
I do not depend on my tenants to pay my mortgage. Out of all my properties, only one of the flats (my latest aquisition) has an outstanding mortgage. Normally I pay off my mortgages in 4 years. This is the first time I am holding off on that strategy to see if the coming inflation is going to cut by debt in half.
And if one of my tenant quits, I will simply enjoy the flat for myself. I am sick and tired of staying in cubby hole hotels paying 150-200/night in SOBE when ever I visit Miami (which is almost on a monthly basis). Incidentally I’m in Miami all this week – in a hotel. I wish that I could stay in my own flat instead.
So shove off your stupid theories you know where.
When you buy a large asset one should do the proper due diligence and not just rely on a marketing brochure. That was a product of the housing bubble I suppose which clouded judgment. What surprises me however is that the contract doesn’t state a s.f. or at the very least reference or incorporate the actual final construction documents….I guess it depends on what stage the construction was at, if it was even finalized at the time you signed the contract. Developers/builders never want to commit to anything at anytime that they don’t have to since things change and unexpected things happen like having to sun a pipe through a new area that needs to be framed out losing 3 s.f or something like that. A 15% reduction in s.f. seems material to me though….however your contract may be the “entire agreement” whereby you agreed that nothing else was part of that agreement including marketing brochures.
You would also be surprised at how much s.f. the walls take up…..that is why they had to come up with a standard of measurement since people would use one measurement for one purpose and another for another purpose and both were right. I have worked with an architect and we went through how s.f. is measured, etc. It has been a big issue for years. I know I look at real estate listings and see the s.f. for the same units all over the place….some of this has to be intentional and they even at times include balcony space in it too….I guess the low s.f. $ attracts attention to the listing even if wrong.
Renter Tom………..I agree that one should exercise due diligince prior to purchasing, but what specifically would you have done? How could I have foreseen & more importantly avoided the problem I eventually faced? Their website was not up & running yet when I purchased. Also the sales team confirmed the square footages (listed in the brochure) to me. This was preconstruction, so I could not physically obtain the sq. footage by hiring an architect. What exactly would you have recommended to help verify the accuracy of the brochure?
In regards to square ft. Nobody cared when they could turn around and flip the property for a profit. People look at any excuse to get out of their contract. Many buildings went cheaper on ammenities etc. most have some clause letting them do it. I flipped many condos and luckily did not get stuck in the end. The courts have sided with the builders in all cases as far as I have heard. You either need to close or give up your deposit. It is tiring hearing people complain about these issues. YOU WILL NOT WIN. Either close or not.
Alan – I sympathize, but you shouldn’t have signed a contract (I know you don’t want to hear that and I don’t mean to sound cold…just telling it like I see it and don’t want to give out false hope). Did you use or consult a real estate attorney before signing? Having some large breasted lady from SoBe tell you that that is the s.f. probably isn’t the best legal position…she was “fake” and so were her statements… LOL You will need to take a thorough look at the contract. Maybe you could get out with something like fraud in the inducement to contract or something like that (a stretch)? If there were final building plans at the time you signed, your best bet would be to review those to see if there was any material changes. Pre-con is risky if you don’t get everything in writing….people were too “trusting”, naive, or whatever during the mania. I know that many people would not sign on the dotted line if they didn’t have a copy of the architectural floorplan in hand. It seems that when $$$ is dangled in front of people they lose a certain degree of rationality in transactions…..not just in condos, but Nigerian banking schemes, Ponzi schemes, multi-level marketing schemes, etc. I would suspect that the actual contract states that the contract is the “entire agreement” and that the buyer did not rely on anything outside the contract etc….. I have to think, in the end, Mike will be right, either close or not….but you can always rattle a few chains to see what the final settlement is I suppose.
RT……..Thank you for your thoughts on this issue. Just want to add that the architectural floorplans were in the condo docs. However, they did not include sq. footages. I would not have signed without the floorplan in hand.
Mike-You are assuming that he bought to flip like you did. I believe you might feel differently if you bought and intended to be the end user.
Alan, did you have a real estate attorney look over the document before you signed? Too many people do not and end up in your situation. The attorney would have been specific regarding finishes and appliances and plans and have crafted language to protect your interests.
Alan – If the floorplans were in the contract (even if omit s.f. calcs) and they did not materially change from that, I’m not sure what you can do at this point. It doesn’t look promising. Sorry bout that.
Alan, the architectural plans should show some dimensions. you were buying based on those dimensions, not a calculated square footage, which as we have seen are suspect. if the floorplans shown devaiate more that 10% you may have room to argue, otherwise you are most likely stuck. hate to see this happen to you, but your behavior, as well as the behavior of the developers, is what allowed this type of bubble to begin with.
it amazes me how people will sign away half a million dollars and their first child, but then argue about a grocery store special that shorted them 50 cents at the checkout. hard lesson learned by many-but never ever let a salesperson push you into signing a document of such significance without a thorough review (meaning at least a week) to consider. anybody who pushes you to sign quickly has an ulterior motive, or is hiding something. salespeople are not your friend, and they are not interested in your financial decision making.
Re the SF discrepancy: The DECLARATION OF CONDOMINIUM controls, and it is incorporated into the sales contract. You should have been given a copy and the developer should have notified you of any changes to the Declaration. Marketing materials always contain a disclosure that measurements are approximate, etc. and may vary from actual measurements. Actual measurements will be within the Declaration, since its public record and what the county uses for tax assessments, etc.
Read your contract. Read the Condo Docs. As you’ll see, the developer gives itself great leeway and flexibility when it comes to fnal product vs. the pre-construction conception. South Fla courts have recently ruled in favor of developers on similar issues…Again, you will most likely not win. The agreements are so one-sided you will have little chance of recovery.
Drew
the opera tower decision was based on the silly argument that the pool did not match the promotional material. i think you would find a more sympathetic court in Alan’s case. especially if you’re in state court.
Alan,
I don’t think you should lose heart with the “expert” advice of the naysayers.
I agree with gables post no. 160 and jcrimes post no. 162.
First as gables suggested, there must be dimensions of the rooms in the floor plan. Measure them and if they are off by more than 10% you may have a case.
As per jcrimes, it is true that a lot of people tried to cite silly reasons to get out of contract and lost in court. But in this case, it is a gross material change which the developer cannot argue out of citing builder flexibility. That flexibility is for certain design, operation, artistic liberties, landscaping etc but not to cheat someone out of living space. You can very well argue that your living/lifestyle can be significantly altered in the negative with a loss of 150 sf of living space.
But before you go that route, the most important thing is to hire an architect to make sure that the Cabi’s explanation makes sense and their flip flop on the sq footage is just a reinterpretation and not physical alteration. Good Luck.
jcrimes
Doubt it. The trends in the courts right now all fall back on buyer responsbility to read the contract and condo docs. Marketing brochures for pre-construction condos are fluff. The floorplans in the Declaration should have been clear what the actual SF is…again, if it changed, the developer was obligated to notify the buyer of the SF changes and then deem whether the changes were “material and adverse”.
Bill P
You’re out of your mind if you think a developer will allow a buyer’s atty to negotiate such terms. These contracts are pretty much “take it or leave it”, aka a contract of adhesion (like an insurance policy). I don’t agree with it, but that’s the way it is (or was)…If you’re not willing to assume the inherant risk of signing a pre-const condo agmt, then don’t do it.
On a related note, did anyone see TRG’s ICON advertisement in the Herald on Friday. It was hideous (crappy photos/renderings, misspellings, poor grammar,etc). Either TRG did this ad piece in-house or hired a low-cost marketing/ad company to do it. Either way, it sucked. Don’t tell me about the glorious Phillippe Stark lifestyle and $500K studios when your advertisements are a huge embarassment. This ad is probably indicative of the current State of the Company: No $ and rampant cost-cutting.
Do you people realize from 1990 to 1999 there were 5000 condo units built? This was a boom time in the economy.
From 2000 to 2008 there were 50034 units built. That is 10 times more. This is during a time when population has actually been declining. 12000 were delivered in 2008 alone. How long can those purchasers hold on before those properties are dumped?
In 2009 we will get another 4833 units.
In 2010 there is another 3175 units.
What do you think this will do to prices? Just stop and think about those numbers
Reading all this bleating about units that are substantially smaller and features that are not provided represented in marketing brochures simply amazes me.
I can not believe that there is no regulation or oversite of the Florida condo industry that obligates it to reasonabley deliver what it promotes and promises in terms of unit areas, finishes, fixtures and appliances. Likewise with building amenities.
I know it is, or at least was, fashonable in the US to decry any kind of government regulation. We know what happened in the financial industy. This same attitude is now resulting in purchasers getting screwed by the condo industry. Bad enough that the market has imploded, but to not even get the unit size or features you were told you were getting iand paid for is a double whammy.
Time to open your windows, stick your heads out and start screaming “I am mad as hell and I am not going to take it anymore”. When you finish that you can start working on making your health care system to make it accessible and affordable.
Alan – Pay little attention to AJ (he posts on wishful thinking not concrete facts – don’t go paying for an architect now, that is silly), as one of the “naysayers” if the building plans were final and they included a copy of the unit, then it is very doubtful that what was built differed from those plans in any material way. I agree with Drew’s posts….that is correct, the two controlling documents, or at least what will be weighed, is the Purchase Agreement and the Declaration. Marketing materials, absent seeing them, will be overridden by some clause in the Purchase Agreement….moreover, marketing materials could have given s.f. of “living space” or whatever to include balconies and the like. Run into the same things regarding “bedrooms”, s.f. of finished basements, etc…. marketing materials are one thing, but the PA and Dec are what controls. I am skeptical that what was done isn’t permissible. jcrimes is another poster that can give the 411 on things here too.
torontoarchitect said – “Time to open your windows, stick your heads out and start screaming “I am mad as hell and I am not going to take it anymore”. When you finish that you can start working on making your health care system to make it accessible and affordable.”
– When Canada starts footing the bill for world affairs, maybe the U.S. will pay attention to our cold neighbor to the north. Until then, Canada is the spoiled little brother to the north that big brother has to do the heavy lifting and expenses for. The U.S. is not under regulated and how long is the wait in Canada for an MRI or CAT scan??? I know of Canadians that come to the U.S. for health care because of the poor services and long waiting lists in Canada. The U.S. may not be perfect, but we have the best health care services in the world bar none. Moreover, no one would be “mad as hell” had they made a profit on their speculative condo purchase…you wouldn’t hear a peep from these people was they tried to flip their condos to others using the SAME marketing materials. Canadian real estate is having a tough time now too, so open your own damn window….and while you are at it, chip in for an MRI machine.
Renter Tom
You are in dreamland with regard to your healthcare system. And further more you know absolutely nothing about ours. I needed a radical prostatectomy this past summer. I had access to the best doctors and whatever tests, scans and medecine I needed. I also had surgury in a hospital of my choice in timely manner. I did not have to negotiate with an insurance company and I was not out of pocket a nickel. This from a healthcare system that costs half of what yours does per capita and still manages to covers everbody.
But rather than debate this issue with you let me refer to the following post that I picked up from ‘The Daily Dish” Andrew Sullivan’s website. It originates comes from an American source, not a lowly Canadian one.
http://www.prospect.org/csnc/blogs/ezraklein_archive?month=12&year=2008&base_name=noah_pollack_starts_this_post
But back to the condo issue. I totally agree with you that if unit prices had gone up whether the buyers are end users or flippers, the number of complaints for whatever reason would be materially less. However, that does not take away from the fact that purchasers are entitled to a modicum of protection and for end users material differences in what they were promised and what they receive should be a breach of contract that should not require litigation to remedy.
One last thing boy genius, this past Friday three Canadians soldiers were killed in Afganistan. That brings the total to 100. My understanding is that to date 513 American soldiers have lost their lives.in Afganistan. As the US has over 10 times the population of Canada I would suggest that we are more than doing our part. As for Iraq and Guantanamo you guys are on your own there.
torontoarchitect said: “I did not have to negotiate with an insurance company and I was not out of pocket a nickel.”
– Heck in the U.S. you can get a “free” scooter chair at no cost too! Oh please, this stuff isn’t non cost and the real cost via govt run health care is less responsive and more wasteful then through private sector. So wake up, just because you paid nothing at the time of service doesn’t mean you haven’t been over paying for decades already.
“that does not take away from the fact that purchasers are entitled to a modicum of protection and for end users material differences in what they were promised and what they receive should be a breach of contract ”
– That is just it, it most probably was NOT a breach of contract, the buyers simply don’t even bother to read them or spend the $200-$500 to have an attorney read them. Greed during the mania is blinding. Do I feel bad for Alan, yes I most certainly do, but the cost most probably is his, not the taxpayers nor the developers. Sometimes you make money, sometimes you lose money.
Drew
What other cases are you talking about? I’ve seen the recent ILSA decision against Cooper…what else? Opera Tower is the only other decision that I’m aware of that’s pro developer. Plaintiff just got SJ on a Cynergi contract.
jcrimes – Since you are a practicing FL attorney, wouldn’t a buyer need to prove intent to deceive here? Seems to me the lack of performing due diligence would pretty much rule out pursuing this unless the issue shocked the conscience which isn’t the situation because the PA included a copy of the floorplans, presumably to scale, and didn’t state the s.f.
RT
I don’t practice down here but, on its face, it sounds like a fraud in the inducement claim, which takes you outside the four corners of the contract, i.e., you lied to me in order to get me to sign on the dotted line. Always a hard thing to prove, however, you have some nice facts here with the significant decrease in size. You could hypothesize that the sales agent said Alan don’t sweat it, you’re getting 1200 sq ft…and then poof, there goes the 200 sq ft . Someone said it earlier, the contract terms are key. No doubt there is a boilerplate “prior reps mean nothing” clause, but you can work around that easily. Alan…can you post the contract? I’m curious. Perhaps there’s some consumer fraud statute also applicable here but I’m just guessing.
I apologize in advance for any repetition that will ensue but I just got home & am amazed at some of the posts. gables…..I feel you’re analogy (re-the grocery store special, post#160) is quite harsh. We are not talking about a 2% change . Actually it is not far from a 20% change. Based on all your good posts here I suspect you would also “argue”. And the documents were thoroughly reviewed. AJ & Drew……..The room dimensions are not listed on the floorplans of the condo docs.. The floorplans in the Declaration do not list the square footage. Bill P…….. If my attorney crafted language regarding finishes & appliances, then I would not be allowed to purchase, as Drew noted. torontoarchitect…….thank you for your sentiment-you get it! Simply put, I did not get the unit size or features that were promised. Renter Tom…….You’ve made so many valid points regarding this issue but when you say “sometimes you make money, sometimes you lose money” this indicates that the big picture is being overlooked. If I am not looking to flip, but instead am looking for a home fulfilling my specific desires which includes, among other things, a spacious condo unit, and I looked for this dream home for years, finally found it, did my due dilligence, and then almost 5 years later discover I didn’t get those features I so fervently sought out (& was promised), then the developer should be made to fulfill his obligation or I should receive my full deposit back. Finally, as Bill P. noted, why was I not informed back in ’06 of the change in method of measuring. It is ironic how they informed me by certified mail of some changes that were not considered “material”. And I don’t believe that the square footage lost by not including that amount that goes halfway through the adjoining walls will compensate for the approximately 200 sq. ft. difference in measurement.
jcrimes……..there were other things promised too (some in writing) that were not delivered. I have not discussed them here so as to keep the discussion focused on the sq footage issue.
Alan,
That is a bit unfortunate for what has happened.
The first thing I see before I buy a house is look at the floor plan and see the size of the bedroom for eg. 10×10 or 12 x 15 etc. I am basically interested to see if I am getting a bedroom or a bed space.
The second thing I look for is the dimensions of the LR. for eg. 10 x 15 or 15 x 20 etc. Very essential info to see if I can fit a dining table or is it just enough for a sofa set and entertainment unit.
This is the first time in my life I have been made aware of a floor plan with out dimensions. That should have rang some serious alarm bells. It is the worst thing that Cabi could have done. Everyone should note what a wretched company this is and black list all its future projects, if ever they come up. This is one seriously shady business entity.
Alan,
Believe me when i say that i feel your pain. If i were to pick sides, without a doubt i would be on your side. i do believe that many of the developers operate the sales division (this goes beyond RE developers) without much in the way of ethics guiding their way, only dollar signs. I do believe their practices put you into a position you would not want to be in. But at that point, you just walk away. If most of the smart money does this, practices will change. there is not enough dumb money out there to continue this type of behavior, but there is enough smart money acting with temporary insanity to allow for these practices to continue. i imagine you just fell into this last category. in all of the documents you signed, was there ever a specific number for square footage or room/condo dimensions? from what you have explained, it seems to me like you signed a blank check? it makes it hard to argue you were shortchanged if you cannot show what you signed on to pay for (official documents and not sales material). but if you can show actual numbers, and the final product changes beyond 10% of what you signed on for, you should have every right to raise a stink.
AJ………..Thanks for all your input. Please don’t forget (it may have gotten lost through the course of this discussion) that I was supplied with the info you describe, along with the totol sq. footage, only it was part of the brochure. The floorplan in the original condo docs is presumably to scale & one can attempt to extrapolate the aforementioned dimensions.
Alan – I don’t trust the sales people, etc. …. they tend to “gloss over” important things. Such as …. no you will have a self park space to only find out it is all valet!
jcrimes – Thought you practiced down here or something? Guess I misread somewhere??? Anyway, yep developers and builders do use their own contracts making it a take it or leave it deal for most. I’m not quite dismissive about just saying it is an adhesion contract and that the prior reps clause should just be ignored. It was an agreement. The best argument, like I posted, was the fraud in the inducement…..BUT, if the floorplan was included and hasn’t changed then it seems like there is no fraud, just lack of due diligence. Moreover, since I haven’t seen the marketing brochure, not sure what s.f. was referring to…..might it include balcony space and the like? Just because it is an adhesion contract doesn’t make it invalid rather terms are just strictly construed against the drafter.
gables………..If the trend is for developers to commit to as little as possible in the condo docs, where does that leave prospective buyers? One attempts to make an informed decision based on all that is learned during the information gathering stage preceeding the purchase.
now that the state has put a half to foreclosures, what is expected to be the fallout of this move? seems like the distressed units were a major player in trying to increase sales volume-mostly due to lower prices. with this aspect of the market to be suppressed, how will the condo market unfold? would have been interested in buying early in 2009, but if we continue to manipulate the market, i wont touch a condo unit. we cannot begin to understand the status of HOA in a building until the foreclosures run their course. the foreclosure holiday is a terrible idea unless one is buying time for deflation to stop and inflation to kick in. but what of the unintended consequences?
Renter Tom………. The sq. footage I cited does not include the balcony; the sq. footage under AC is listed separately from that of the balcony.
alan, developers must learn to take on more of the risk of their development. years ago, a developer to out a loan on the property and completed much of the building design with debt under their own name. final product was not an imagination, it was fairly well known. now developers think the proper business model is to have “investors” pick up this early debt-and the result is the situation you now find yourself in, where the final product is a work in progress. preconstruction is purchase as an “investment” not as a final product-and all the risks inherent in an investment.
even though you were buying as final end user, in reality you were buying into an investment situation, and these are always fluid. buying later, when the product is final, is the end user product. but you dont get the investor discount because you sidestep the risk. in essence, this is why new york state has strict rules on the sale of condos as investments. but florida is still not a mature business state and allows such behavior.
Bottom line and lesson learned for me is don’t buy pre-constuction. Buy it when you see it and liek it. The prices are the same as they were in 03-04 in most bldgs now so atleast you’ll see what u get. Unfortunaley, eveyone was shafted cause eveyone tought prices would keep going up so if you didnt buy then you’d never be able to afford it.
Happend to me when I bought pre-cons resale..when i saw the finished producted it was a joke. I based all my time on the floor plan square footage and spend all my time looking at furniture anticipating my lovely home only to be disapointed when I saw it and found out I couldn’t fit any of the furniture I was looking at. Layout was the same as the floor plan but it just was way smaller than anticipated with most areas off by 6in to 1ft However it was the same song and dance measured from the midwalls crap.
So end of the day I said bye bye. Cost me alot but I took the hit rather than be cramped in a pad I didn’t like. Bldg was nice but unit was a shame…even if u fixed it up nice it would still always be small.
many cities around the world have small units as customary and accepted. London, Paris and New York are some examples. Question for miami folks-will it be customary and accepted for Miami to have small units over the coming decade? Many older buildings have larger units (Atlantis for example), while many newer units are much smaller (between 1000 and 1200 sq ft for 2B). will this decrease demand for Miami units in the future? long term, do you think a larger unit, even in an older building, will be better to live in and resell down the line than many of the smaller units in new buildings?
I think the Everglades includes half the hallway in its sales brochure. The condo docs for sure have drawings of the units and buyers are given a number of days to review these and may cancel the contract is not satisfied.
Alan – It could be smaller…….
http://www.cnn.com/video/#/video/international/2008/12/07/gutierrez.us.tiny.house.cnn
“How many square feet here? Depends on how you count it….”
RT…………wow-98 square foot home! Just wondering, if I had him build me a similar sized home & it turned out about 200 sq. ft. smaller than promised……does that mean I now have to go out & build a small home for him?
“Asset managers aid condo owners turned reluctant landlords”
Any opinions on this type of garbage?
RT
when i first came down here from up north, i practiced for a bit. in the last few years, i’ve moved over to the business side. still keep the license…hell, it cost me enough.
That is really bad for people that have purchased some of the expensive condo’s. So you have a pricey condo, you rent it out and it will not cover even half of your costs of mortgage!!
Gables #185, you bring up a valid point, but what made Miami a palatable place to live vis-a-vis London, Paris, New York, Tokyo, etc was in addition to the great weather you had relatively low density, less congestion, more living space, and if you were in a high floor you had miles and miles of view in any direction. (40th floor view in NY, you’re looking into someone’s living room.)
what has happened to Brickell is nothing short of disgraceful. So many completely unneeded buildings have gone up and so much of the view from existing buildings has been needlessly destroyed. take the new building Infinity for example. did they really need to build two towers? how many days a year will the pool between the towers see sunshine? is there really such demand that people will be willing to have a unit facing directly into the other tower? would it not be a better, more desireable building if it had only one tower?
Brickell used to be a great place to live and work. any high floor in any buildign would have had a decent view. if the new buildings that have gone up actually represented real growth for the city, then they would have of course been a necessity. but they don’t. they represent unfettered greed and irresponsible access to stupid amounts of debt. they will either remain empty for generations or they will be filled with residents who will most likely bring the area down.
the mistake miami has made is trying to copy other cities with these small sq ft high rise buildings in a region that does not demand they exist (unlike manhattan with limited land space) and pushing too many people into too small of an area to live comfortably. i realize the more floors the more cash for the developers and city, but the best move would have been more 10 to 15 story midrise buildings, with plenty of living space for each unit (let 2B units push 1500 sq ft). such structures could have been built around an interior courtyard, etc to maintain privacy. i realize some of the high rise units currently have great views, but they are truly few and far between. better standard of living should have been considered-leave the high rises to waterfront locations if needed.
in the long run, it would have been much easier to populate a bunch of 2B or larger units such as those described above than all of the 1000 sq ft units we have. hard to keep families in the brickell or downtown area for long term without larger living quarters. and families are what are needed to provide stability and better living standards in an area-not short term transient renters live myself. those of you from new york will certainly recognize the large number of people who live in buildings under 15 stories and the purpose they serve in the community-small businesses at the first floor to satisfy consumer needs. not seen in brickell. downtown may be able to overcome this drawback. streetcar system (not the people mover) would better bring the two communities together.
A small space is much more liveable when you have things to do (restaurants, retail, work, entertainment) all within walking distance or a hop away on public transportation (NYC, San Fran, Chicago, London, Paris). Unfortunately living in a tiny condo on Brickell Ave behind security fences/gates and nothing in walking distance feels more like a prison than “urban living”. I wouldn’t mind living in a 600 sf apt if I had a bar/restaurant on the ground floor of my building. On the other hand, I lived in a tiny studio in the Grand Flamingo about 6 years ago (pre-conversion) w/o a balcony and I wanted to blow my head off by the end of my lease.
jcrimes-
The Opera Tower case is significant, as you note. I believe the Marina Grande case in West Palm Beach had a similar pro-developer ruling. But besides the few cases that actually make it to an appellate court, I know of plenty of instances where buyers have been advised by counsel that their best option is to refuse to close and just walk away from their deposit, as alot of these sf disputes are not worth filing suit due to a high potential for an unfavorable outcome.
Hi everyone,
What is generally more successful to own for short term rentals in Miami Beach – 1 bedrooms or 2 bedrooms? Or is just personal preference of renters? Thank you in advance for your input.
My first thought on the recent foreclosure moratoriums popping up around the country: not fair to give misfits a benefit for failing in the financial arena. then a second thought: are these modifications on mortgages which could result from the moratorium really going to help the situation at all?
latest news says over 50% of recent mods are now late in payments-not a good sign. my guess is the moratorium and modifications will only prolong the inevitable. in addition, the banks are able to force the poor mortgage holder to continue to pay on a mortgage they neither want nor can still really afford. ultimately, this may allow banks to foreclose and resell the property in the future at much lower prices-those which many of us here on this blog are interested in paying. with patience, and if we avoid bad inflation, perhaps we will win after all. and the supposed bailout of current mortgage holders really amounted to another bailout of the banks. the homeowners still get foreclosed on, just after they have been milked dry.
Before the Great Depression you needed 50% down and had short mortgages (5-10 years)….those people lost their entire wealth when foreclosed upon and the banks were the bad guys. Now, esp. with bank stock in the hands of nearly everyone in one way or another, the banks are getting the short end. So, in that sense, this time it is different.
that is why everybody, including the banks, are trying to delay the tsunami of foreclosures. taking over a house too early into the mortgage is not to the advantage of the bank. payments must be made for several years before they can recoup some of the losses. recent government intervention appears to be subsidizing the “interest” lost by the banks. now they just need a couple of years of payments on the principal in order to resell at the new deflated prices.
Wow finally a real and mature dialogue between intelligent people. This blog has not been this informative and mature in a while. the riff raff seems to be conspicuous by its absense. No complaints here.
OK now the bad news. Why does it take an outsider to give a perspective on Miami? Are all you locals so impervious to what is going on? Cause no one – not a single person has talked about it.
My first day in Miami, I am still reeling from some shock and depression. It looks as if someone dropped a nuetron bomb on this town. SOBE is almost deserted. This is December, a peak season. Even in the dog days of Summer, I have seen more hustle and bustle here. The beach is sparse, Ocean drive is devoid of any foot traffic. Restaurants are empty. I just saw the effects of recession first hand. In New York, you do not see such scenes (at least not anytime soon).
Everything is on sale, everything is half off. Dinners, drinks, tshirts, trinkets you name it. But no takers. Hotels are offering deep disounts also. Usually I pay between $1500-1800 for a 5-6 day trip (including air). This time it is only costing me under $1000. You could even buy some love for nothing if you wish. It is pretty sad.
I know the country is reeling. But I dont care about the travails of Orlando or Vegas. Disney and the casinos have a lot of money to ride this out. I am worried for the mom and pop businesses dependent on tourists that dominate this town. I sincerely hope they can make it beyomd the new years eve.
People readin this everywhere, please take a trip to Miami (only) if you can afford it. Not only will you do it for half price, you can help out the local economy. By this time next year, we most likely be out of the hole and the these incredible deals may not be there.
Everyone who ever loved Miami should seriously consider this.
thanks
This response is to poster Number # 195
The Smart Money asks “What Planet are you from!”
A typical monthly mortgage, taxes, insurance, maintenance and hoa dues on a Miami Condo is running around $3,769.00 per month for a 2 + 2 and 2,974.00 for 1 + 1. Short term rentals, those being 6 months or more are at an average of $2,400 for a 2 +2 and $1,400 for a 1+1 . That is assuming of course that you’ll be able to find a renter as there are some 10,000 plus Miami Condos for rent or coming up for rent in 2009.
Therefore, The Smart Money is amazed that an Alien from another Planet would have the gall to ask which of the two are the more successful rental options. Well if on the Planet you are from you call a monthly loss of only $1,369 for a 2+2 as oppose to a monthly loss of $1,574 on a 1+1 then clearly the 2+2 is the more successful purchase of the two.
However, if this is how you and your species from what ever Planet you hail from gage success then The Earthly Smart Money strongly urges you and you Alien friends to buy up the whole of Miami if not the whole Planet as we The Smart Money wait in our spaceships for you and your Alien or Earthly fools to purchasing a Miami Condo for a price greater than $125 per square foot.
The Smart Money, gaging successful investments one planet at a time.
In other news, I loved the location of Everglades. Bang opposite Bayside Marina. Cant be beat. If not such a cramped out building, it would have been great. But I am still waiting for eyewitness account to the actual units. Is it really what it is said to be?
I have been following Mondrian since the construction started. I thought it is going to look hedious, trying to convert an apartment block into a chic hotel. But Today I saw the finished product (from Outside) and it looks really great. It looks like a nice boutique hotel. Soon I hope to check the inside etc if time permits. But nice, very nice addition to West Avenue.
The skyline is looking all filled in and more beautiful. Icon looks like a ghost tower with just flashing red lights. 900, MB and 50 Biscayne looked really really occupied. Like almost fully occupied!! Marquis and Paramount cranes are all gone. Met 3 looks like it is racing against time to complete!!! More observations later. G’nite
AJ said: “In New York, you do not see such scenes (at least not anytime soon).”
– That’s probably because a fair number of people from NY that would be in Miami now are staying in NY instead. Businesses that ran business plans based only on good times and not on lean times will hit a brick wall or small retailers will have to tap into personal savings as they won’t be able to service their debt. Retailers will tumble away after the new year as sales won’t be able to finance their inventory loans…esp. small and specialty retailers. Restaurants are going to get hit too. We’ve entered a “big pause” in spending and the deflation negative feedback loop is here….. Hate to say it, but once the election was over, those with real wealth (not debtor “wealth”) began to adjust and plan for what was promised….higher taxes – cash out and take your gains now, put your capital to work elsewhere, etc. The election of Obama sealed the deal for a really nasty downturn. I know I made significant adjustments after the election, I know other people that have too…..Now Obama is trying to shore up confidence that he isn’t a radical socialist and back peddling on campaign promises to raise taxes (one of the big errors in the Great Depression). So far, bringing Paul Volcker on board is the first positive sign that I have seen…albeit only as a special adviser and not any real authority….that is providing some stability to the capital flight. 2009 looks to be gone before it even got here… I had thought 4th Q would be the big quarter where people really begin to just throw in the towel…..well, looks like 2009 will be the year of the downward spiral as things domino as the supply level retrenches to the new lower demand level. It will be very unpleasant for many as their assets disappear to pay off their debt obligations. The retirement dreams with second vacation homes for many will be out of reach as they can’t afford it and now one would finance it anyway.
AJ said: “OK now the bad news. Why does it take an outsider to give a perspective on Miami? Are all you locals so impervious to what is going on? Cause no one – not a single person has talked about it.”
I mentioned a while back that things are only starting to get bad. People think we are close to a bottom in South Florida or only a year away? Get real, the “real” bad times are just starting now. The speculative real estate that propped up the GoGo times won’t be coming back.
However, there’s a lot of people that have been slowly drowning hoping & praying it comes back and 2009-2010 is when they go belly up. There were an amazing amount of people pocketing $60K+/year in Miami that had no real skillset but happened to be involved in Real Estate and possess “people skills”. Now you take away Real Estate, what other local $60K+ jobs can somebody with only “people skills” get into in Miami?
AJ#199
RE cost of staying in Miami now: if high season demand does not materialize due to this lousy economy there could be some true hotel bargains available using priceline’s ” name your own price” system.
Have used this for >50 hotel stays in US Canada Europe since 2003 with nary a bummer.
Have had some outstanding values that were greater then the ” as much as 50% off” that the PL ads allege in their ads in Vancouver Paris Zurich Portland Or.
First check Biddingfortravel.com which is the bible for placing intelligent bids and you will see that Hyatt Regency has been “won”recently for $85+Pl fee+local hotel tax..
Know that when the going gets slow Hilton Doubletree and Marriott near your 1800 all use PL for excess rooms inventory.
Read the FAQ and learn the rebid rules and if BFT information helps you save $ PLEASE take the time register there and ADD your experince to help the NEXT user.
JL, I am in complete agreement with you regarding the number of $60k+ jobs in the miami area which was ridiculous. without a technical skill set, no education and only a smooth talking demeanor, job prospects will be slim in the future. get ready to earn $30k a year actually working 40+ hours a week if you want a paycheck in the next few years. this will be tough on the miami mentality, and will result in significant social unrest in the area for a while.
RT, i agree with you most of the time, but you are wrong to blame obama for the downturn in the economy. one, he was not steering the ship over the past decade, it was the republican party. two, while you may disagree with his solutions, conservative and free market ideology has guided us to the present situation. i am not in favor of socialism, as any pure ideology does not work no matter if it is socialism or capitalism. but you argue that obama’s election put the final nail in the coffin. and you think a mccain election would have resulted in a different economy? the wealthy make financial decisions independent of politics as you should know. you did not pull out of the capital markets because of a nominal increase in capital gains taxes. you pulled out because the market was a place to lose and not make money. you would have pulled out if mccain had won as well, i bet.
Gables, I agree. RT is claiming as if McCain would have been good for the economy, when he can’t even figure out the economy is going down the drain. Obama might not be good for the top 3 % of the population, but he’s good for the othe 97% of the people. Also, look at the tax structure currently. The rich still pay more taxes, so how come this is not socialism? I think those who voted for McCain was mostly for tax purposes which tells us they are not patriotic because they do not care about what’s going on in America with the rampant corruption in government(eg Haliburton). Not a single resignation occured after 911, Katrina. Bush even had the audacity to congratulate on the dismal response to Katrina, remember “Well done, Brownie”? We have become the Crusaders of the past by invading countries. McCain would have been a disaster for our country. Look at his first Presidential decision, picking Palin for VP and our country is already a laughing stock.
AJ @199 : SoBe is a tourist spot, hence that is the first place you will see the effects. People are cutting back on travel and spending. I was in Miami recently and SoBe was mostly deserted, nothing like the place it was till last year.
gables – Since the election the markets have spoken….cascading downward. Where was the post election bounce? We had a crash instead. I cashed out some gains instead of letting it ride since Obama along with the demo congress promises to raise them substantially. I intend to Obama proof my portfolio and I’m not alone…even some wealthy that vote democratic are doing the same. The first place to look to blame is always congress first — dems have screwed it up over the past few years. The wealthy do NOT make decisions independent of politics…where did you get that from? I disagree and will leave it at that. Since the election even AJ is saying SoBe is dead….. where is the hope? So many people were saying oh wants he gets elected everything will be better…my answer was always no it won’t, you just wait and see.
Sorry Roger you are wrong. The top 3% aren’t going to sit back and see $20K-$1M in extra taxes happen. They will adjust accordingly. I have, others I know have. I have a great, conservative, highly ethical CPA and I am able to make substantial adjustments….all non agressive positions. Just think what the much more aggressive people will do…. Just look at what has happened since the election….the markets move on certainty, well once the election was over we had certainty of where things were going…. Gotta love the IL govt in custody now too……
RT, you have again started to rant about Obama and the economy. This economy is the result of the last 8 years of blunder America has faced under the Reps and Bush. When you hire idiots to the top office, this is what happens. If you have forgotten, we are still ruled by the idiots. America, as the rest of the world already knew, finally choose someone who has more vision than a bat in daylight. Enough of electing people who don’t believe in science and keep pushing their religious agenda.
As you can see, the markets have kept spiraling down due to Bush and co. policies along with that idiot Paulson who royally screwed up the bailout plan. And there are some “educated” people here who still believe in McCant.
Sorry Roger – Bush got the blame for everything including bubbling idiots in LA for Katrina (thanks incompetent mayor and governor) and didn’t point fingers at them when he should have. Obama did the same thing blaming Bush for everything. Now it is time to turn it back. Everything going forward is Obama’s fault from now on. Milk prices up, Obama’s fault. More foreclosures, Obama’s fault. I’ll start handing out cards with the White House switch board number on them and simply say does ask me for X, call this number and ask for Barack.
Credit Suisse – is forcasting by 2012 10%-20% of homes with mortgages will have been foreclosured upon with the most probable of 16%. Just wait until they come out with the business numbers in SoBe that will go under…..yep, a lot of people will want to live there.
meant bumbling idiots
” The Treasury just sold $27 billion in three-month bills at 0.005%, the lowest rate since it starting auctioning the securities in 1929″
– Can someone say liquidity trap?
Roger, you seem to conveniently leave out who has been the majority in congress the past two years.
Now, put down the keyboard and go back outside. Recess is almost over.
PTC, thank god dems have been a majority recently otherwise the religious idiots would have wrecked the country by now. Now only if you could pull your head out of your ass, you just might see daylight
have i gotten too big for my britches? a 60k job doesn’t seem like much to me. honestly, how does one live in miami on 60k (outside of mortgage fraud)?
Are you guys ready for some real fun? The gaurdian.co.uk is reporting that the US will be losing a million jobs a month and that unemployment rate will double to depression levels. Time to buy a $400,000 condo AJ?
Ace,
re: post 200
Judging how witty and elaborate your post was, I gather that you are pretty sharp, minded individual. I am well aware of rental risks and large number of available units on the market. I am helping a friend to find something that he can enjoy for part of the year. When he is not in Miami, the apartment will be rented on short term basis to cover some of the carrying costs.
He is not looking to make a killing in next couple of years. We all know it is not going to happen. Since he is putting 50% down, the carrying costs will be lower than on typical Miami investment mortgage with 104% LTV. I am just looking for people who have come to contact with short term rentals (ranging from one week to 6 months) who could weigh in on best options, buildings with relaxed rental policies etc.
My friend is also an older gentleman, who tries to live and enjoy everyday like it is his last day. He deosn’t want or need to delay the purchase to see Miami hit the bottom.
I meant to enjoy every day
The Ace / The Smart Money,
Re: Post 200
While you were: “gaging successful investments one planet at a time”, you failed to mention the tax deductions / credits of the mortgage interest and real estate taxes.
Using your numbers of monthly costs for the 2+2 of $3,769, the mortgage interest is probably around $2,000 / month and the real estate taxes around $800/month. If the monthly costs for the 1+1 are $2,874, the mortgage interest is probably around $1,500 / month and the Real Estate taxes around $600 / month.
Assuming the buyer’s tax bracket of 30%, the 2 Bedroom is a better investment from a cash flow point of view.
Also, as a rental property, you omitted the property depreciation credit (spread over 20.5 years).
Roger
Dont pay any attention to rentertom and his distortions of the truth regarding the collapse of the American economy. Theres a Paul Simon song that says it best “People hear what they want to hear and see what they want to see > Then disregard the rest”.
HAHAHAH! Is your reference to “the guardian” supposed to somehow suggest that they’re knowledgeable about markets, the economy, or anything concerning real commerce. I will concede that they’re knowledgeable in all things concerning Labour. But let’s get real, given that the UK economy is much more indebted than the US should you step up and pay $400K for that condo you’d probably make quite a bit just on the movement in Cable ($1.47/£ and heading to parity).
RT, the cascade in the market essentially ended in mid october, before the election. since then there has been the extreme volatility expected in uncertain market conditions. other than some pundits on tv who expected a post election bounce-why would you have really expected such a bounce. you and i both expect things to get worse-a bounce is not a logical component of our expected futures. we lost nearly 5500 points on the dow from oct 07 to oct 08, the drop in the past month is not the real damage. although i do think more is yet to come.
would you be doing anything different financially if mccain had been elected? you would still have cashed out your gains and moved your money into a safer haven. you would have protected your assets regardless of the party in office, because you know as well as I that things will continue to deteriorate regardless of the party in office. some things are just beyond the control of our political leaders-and this economic crisis is one of them.
gables – It is all Obama’s fault now. If you step on a used piece of gum on the street, it is his fault. That is the standard they set for Bush so that is the standard I will use going forward.
Right now 12-24 months CD’s can get around 4.2%-4.36%….not too bad. What has surprised me is the speed of getting to a liquidity trap situation. In a deflationary environment a zero yield is really a gain just like 5% mortgages are really much much higher in real dollar terms when taking into account the asset deflation. Hopefully we can just reprice the assets and move on….but I doubt it.
i hate to turn this into a political blog, but why are people so darn polar and blind to events surrounding them. i tend to middle of the road, since both sides have ideologies that are unrealistic. and i see mistakes on both sides. i am sure obama will have his share in the future-but cut him some slack until/if he blows it. bush may have had some successes in the past 8 years, but you cannot dispute some of the major blunders which have occurred under his leadership as well.
who is the “they” that set the standard you talk about? the lunatic fringe on the left? when you take the same tone on the opposite side of the story, does that make you any different? this country will have a long road to recovery as long as people continue to have this polarizing view of each other.
Gables
Of course your right. The Dow went down form a high of 14000 in Oct 2007 to its October 2008 low of intraday 7900 in october 0f o8 well before we knew Obama was the winner and all the while Bush and his team watched the demise they created. Republicans are notorius for never taking responsibility and their feeble attempts at revisionist tactics. The 911 terrorist attacks happened on his watch while in August of 2001 he slept that month away on his texas ranch while ignoring intelligence reports to the contrary. Now the economy has collapsed under his watch and people like you and me and even rentertom who voted for this nitwit will pay the price. Denial is not an attractive attribute.
It is all Obama’s fault now….so why beat a dead horse…. LOL 🙂
Kramer said: “Dont pay any attention to rentertom and his distortions of the truth regarding the collapse of the American economy.”
– When did I say anything of the sort, AJ.
Oh dear! I do hope the current economic environment won’t allow some pauper to afford a splendidly appointed flat in brickell!!
In regards to politics I support whoever the most splendidly appointed candidate is. In fortunately Donald Trump is not president. Have you seen how splendidly appointed the flats in Trump Towers are? The 2 bedroom units with direct bay( oh dear, I mean ocean, sorry AJ) views are the most exquisite flats mine eyes have ever beheld!
If only I wasn’t yachting to Jerusalem and then to New Delhi I would most certainly be purchasing a Bentley motor car in Miami to support the local economy. They have the
most finely appointed lambskin floor mats in those motor cars!
Oh dear, I’ve gone and made a typographical error that only plebian owning a home worth less than 350k would make. I meant to say unfortunately.
Shocker!! Ace actually is capable of saying more than 2 words ($125). Just read his #200!! Times they are a changin’
More updates. Paramount demolished Something about Mary’s house. After the crane collapse, they deemed it unfit. Very sad. It was supposed to be a high end restaurant or something. They told me the building will be ready in 6 months.
Paramount altough lokking nice will take a big beating cause they were starting at ABSURD pricing. I’d be surprised if anyone closes. I remeber them starting liek at 700+ for the 1bd that was liek 1400sqt ft. CRAZEEE!
So something about Mary House may just be another excuse for another condo lawsuit of not delivering as promoised. haha
“1bd that was liek 1400sqt ft. CRAZEEE”
——————-
Is that 1400 sq feet measured from the inside edge of your wall or the wall midpoint or the outside of the wall or 1 foot outside of the outside of the wall?
… got to get a laser tool from Home Depot and check these things nowadays
i’ve followed this blog almost from day one, and it is quite interesting how the dialogue has evolved. in the early days, most of the discussion was on the amenities in each building, and decisions on which building would appreciate the fastest over the next few years. careful not to wait too long or you will miss out on the building of your choice. but the info was great regarding where the building was located, what activities to expect in the building and location in general, etc.
then the slowdown began (before the financial crisis) and discussions seemed to focus on defining a building as best and average. buying is still an option, but focus on the best buildings for maximum returns. soon after, the mortgage fraud issue became important, and the focus was on avoiding buying in a building with fraud-but still buy a unit. this is when the thought began to occur to many in this blog that you could actually lose money in RE. but the focus on the blog was still the buildings and amenities, but separate the distressed with secure buildings.
as the blog evolved over the past months, the arguements began over boom or bust. much of the focus was on losing versus maintaining capital over the long term. now we discuss very little about individual buildings and amenities, and mostly focus on the financial aspects of world events as it relates to RE.
Lucas, while many here still disagree with each others opinions, i think your blog has been a delightful illustration of both the condo RE market and world economic conditions. you may not have intended for this to occur, but your blog has certainly evolved over time, and i believe for the better most of the time. your readers will become the most informed buyers when things finally turn around.
We’ve seen those with poor balance sheets and incomes fall out of the market. What we are seeing now are those with modest balance sheets tumbling….they hung on, listed their condos at high prices out of denial, to save face, or whatever, but they are crumbling now. They want out….but how they get out is proving to be difficult…..get out of the purchase agreement, negotiate a short sale, get a renter in, stop making the mortgage payment to feign distress, etc. …. With illiquid assets it is tough to get out sometimes and this is one of those markets. What will cure it? Lower prices…it is the only way to sell.
Just saw this after posting above:
http://www.usatoday.com/money/perfi/housing/2008-12-09-homeowners-late-mortgage_N.htm
– I know of people who have told me they are purposely stopping their mortgage payments even though they can afford it…..they want to renegotiate with the bank, aka taxpayer money, try to help out and look what people do…sad.
By the way, Miami Today is reporting that Tibor Hollo is going to lease the Villa Magna land to the City to use as a new bayfront park rather than build on it for 3 years (at least, I’m guess it will be a bit longer).
I can’t wait until January. That’s when the real layoffs and the price collapse will begin. Sometimes the bulls need a good kick in the face.
Also, the Ace is AWESOME!
Dave – But… but… but, where will AJ eat now? I guess it will make for a prime location for dogs to poop…and the dogs will really enjoy the fantastic views! Too bad the dogs don’t have the money to buy condos!
Lucas
Any updates on closing ratios of the newer places like Met One – Plaza – 900 Biscayne – 500 Brickell – Axis etc.?
Update:
Today SOBE is a bit more lively than the past few days. Some small relief.
I checked out the Mondrian finally. It is quite nice. Very White. Starkly white interiors.
Pool area is beautiful. Only the fake grass carpet cabanas must be pulled down immediately. But compared to Setai etc, it does not hold a candle.
There is a walkway connecting Mirador North and South towers with a openable gate. But there is a security gaurd preventing the “undesirable” Mirador crowd from walking in past the Mondrian pool side! Reminds me of Habana’s hotels seperating the rich outsiders and the locals quite diligently.
Tried the Asia de Cuba. OK. Appetisers $15-20, Main course $25-40.
Both the restaurant and the Sunset lounge were jamming. But that is because everyone wants to check out a new and hip place. Let us see if it sustains.
Regarding Once Again #231, Can someone actually go to court saying that their love life is permanently destroyed as they can no longer get off visualizing Cameron Diaz changing her cloths at the famous window of ‘something about Mary’s house’!? and so therefore their contract with Paramount should be null and void!!
In any case Paramount, instead of repairing the crane damage took the easy way out of demolishing. That house was a unique sellig point for that project. But even with the loss of that restaurant/retail area, their mall below the building extends all the way from the water to Biscayne blvd. That is a lot of space to fill. Among the super six, I am very eagerly anticipating the opening of Paramount.
Marquis looks very imposing and very huge. I think it is the second tallest after Four Seasons. If the FAA did not object to the top 10 duplex pent houses, it would have been the tallest building south of New York. At least that would have made it very prestigiuos and survive a bit.
Hate to change the subject (what was the subject, anyways?) —
I just took over as attorney-in-fact for a friend who owns in a Biscayne corridor building (120 or so units). The condo board consists of the developer principal (as an individual owner), his sister-in-law and one other. The manager is the developer’s sister. The developer still owns 20 units that he is trying to sell/rent. Last night was the budget meeting which was passed by the board unanimously, it was quite clear that the developer/board ran the table with little dissent from the small crowd. With that said, I was thinking that besides my gut reaction to the nepotistic shady personal-relationship issues, the board and the manager seemed quite competent. They did unilaterally decide to discontinue valet parking (which I disagree with, even given the cost). However, the more I’ve thought of it, it appeared that at this point, the developer and Condo Assoc. appeared to be aligned with their ultimate goal of preserving value/marketability, etc., especially since the developer owns such a large portion of the units. By, now I’m sure I’ve given away the identity already as to the ID of the building…
Can anyone tell me that I’m off base, in claiming that it’s a good thing when the fact that the manager and 2/3rds of the board is functionally the developer? I immensely respect the opinions of just about everyone on this board …
i would hate to own in a building subject to those conditions. the personnel may be competent and make appropriate decisions, but the risk from having such a conflict of interest situation is more than i would want to bear. like you said, they have a common goal of preserving value/marketability. but what about long term issues (beyond 5 years) which may need to be addressed? what happens when they begin to default on their loans, and the options are rent to anybody or bankruptcy? that could evolve into a bad situation. my faith in the ethics of the business world is shot. but hey, i have seen legitimate condo boards drive a building into the ground, so the alternatives may be even worse!
I think its awesome that they discontinued valet. Who the heck wants a complete stranger driving their car around daily? I’ve got money, but I didn’t get rich tipping someone 4 times a day for retreiving my car. Totally idiotic. My prediction is that most condos (that have adequate parking), discontinue the valet parking.
fairkim,
I believe to eliminate valet or any other services a majority vote of unit owners would have to take place. To meet the requirements of Florida Statues 718 notice would have to be given to all unit owners and other requirements would have to done to meet the state rules. Elimination of valet by the developer could also open them up to lawsuits. If the developer promised it as a service he better provide it.
Nobody in Miami now anything about how to run a condo. Once you read the statues you understand why I’m so negative against condos.
900 guy – Amen to that…… valet parking is more of pain than any possible amenity. Not only do strangers drive your car, you have to wait, tip them for waiting, and then also pay them through the monthly condo assessments……
You can also use the stairs instead of paying monthly elevator maintenance. Turn off the elevators. Pools? Tell everybody they can jump in Biscayne Bay. Hall lights? Turn them all off. Residents should use flashlights. Security? Hire illegals. Insurance? Skip that too.
I appreciate the comments; personally, I think that valet is a practical waste. However, it does distinguish some buildings from others as an amenity– so I definitely see your point Wild Bill.
Again, I understand the intuitive “slimy” feeling I have about the board/manager being the same entity as the developer. But, it seems that as of now, the board appears to be doing a good job with goals aligned to the owners.
I’ve seen on numerous occasions very reckless driving by the valet parkers in the garage of my building. In one case were I not in a hurry I would have physically beaten the guy for swerving and squeeling tires of a neighbor’s property. I see no need to employ these people if they behave like this with another’s property.
such an insider relationship on the condo board cannot be healthy, either.
I am looking for 2/2 or 1/1 spectacular deal, can be foreclosure or quiet off the market property for sale. Specifications: Miami Beach condo, either ocean or bay view, price range $400,000-$650,000. South of 40th Street. If anyone has any suggestions or properties in mind, please email me at [email protected]
Thanks
It looks like people are starting to accept foreclosures peaking in 2009-2010 now with a recovery slowly starting in 2011.
JL – I think that 2009 can be written off. As unemployment continues to rise through most of 2009, home prices will continue to fall and foreclosures will continue at a high rate. Not sure when the peak will be but after the peak both foreclosures and unemployment will be well above the norm. A “recovery” in 2011 is possible, but that may be just in nominal dollar terms…which is better than what is happening now I suppose. Things look like they will be anemic once a recovery is underway. Everytime I review the macro econ factors, things look negative….hunting for positives and come up empty handed….
fairkim,
the developer can hold on to the board for at least 3 years from opening the building. 2 months ago, the 1800 developers held a election and picked one of the owners to join them as a board of director. So there are 3 Directors, 2 developers and one home owner.
The home owners rep is doing a great job in keeping expenses under control. He fired 5 employees and reduced the staff from 24 to 19. Trying to get rid of one more. The 2/2 maintenace just went up by $20 for 2009 to $519. It is the lowest maintenance for a brand new 2/2 in a luxury building. The other 2 directors who are the developers are happy too. They have to pay for their share of 140 unsold flats. So they have no complaints. The owner-director suggested that we fire the management company all together and self manage. The developers voted to keep the management.
The owner director told me that as soon as the developers form a HOA in a couple of years , we should self manage the building for half the price. I told him I have been saying that all along. Why pay a middle man? Half the money goes in their pocket and only half is paid to the employees anyway. But all along the stupid owners in all condo associations are either lazy or clueless or both. If A few smart set of people are living in a building, they can really work wonders.
When I say self manage, it does not mean a home owner sits in the office on a volunteer basis. We can actually hire a professional manager ourself and pay him instead of paying a third party to do so. So can we hire janitors and security people. We can cut maintenance costs by up to 40% by self managing.
AJ, you seem to have a pretty good grasp of the cost associated with HOA. in general, do you have a feel for what a reasonable rate should be for HOA dues such that no unexpectedly high assessments will be dumped on the owners? I see rates ranging from $0.40 to over $1.00 per square foot, some in buildings with identical amenities. thinking of a nice building with pool, no valet, average gym, etc. what price should one expect?
1800 sounds like a disaster. 140 unsold units. Already talking about self management. I know where 1800 and all the other buildings are heading. Very few people in Florida have an understanding of condo laws. That’s what makes owning a condo so much fun.
gables,
1800 charges 40 cents per sf. The lowest among all. Yet the buildings amenities are top notch. It has almost zero defaults with regards to HOA payments.
The developer holds about 29% of the building. He is considered as just another home owner with multiple units and pays the dues accordingly.
Almost all his units are being rented as we speak. Considering the fact that he paid off his construction loan and owns these flats outright with no mortgage, He will be making money on them until he sells them one by one in the next 3 years on his own terms.
Ask any realtor dealing with 1800 and he/she will tell you the developer will not discount a dime whether he is selling or renting his units. If at all any deal, it has to come from a desperate home owner only. From what I gather, 1800 is wildly popular with renters as well as home buyers even now.
Coming back to 1800 low HOA, there are a few reasons.
The developer is an extremely intelligent and smart man. He is also an engineer with a great vision. The building has been constructed with nothing but ideas to save money. It should be a model for others looking to cut costs.
Secondly, He decided to only get a minimum mandated flood insurance for the building instead of the maximum possible. So that reduced the hoa charges by 15 cents per sf. So I have a choice to insure my flat on my own for the additional coverage or not. I like that Idea. I want to be in control. Some fearful people will get the additional insurance. But I who believe that Insurance is the biggest scam in this country refuse to get the additional coverage. I will assume the risk. What The F is going to happen to my flat in the skyhigh due to flooding? I refuse to throw $200/month away to those bastard insurers who don’t even pay up in case something happens.
Can someone enlighten me regarding this goddamn flood insurance. Its pros and cons and why does a 40th floor flat need it and what happens if you dont have it.
Regarding gables Q,
That all depends on the association or how well it is managed. My SOBE condo has a basic gym/pool and nothing else. Period. I pay 53 cents/sf there. Such a joke considering I pay 40 cents in 1800 which is like a five star hotel. So gables, there is so much grey area here to have a simple answer such as “these many amenities should cost these many cents/sf”. I wish it was like that.
When you are looking to buy, look for a building with at least 70% closed. Well managed with low HOA and with out unnecessary bells and whistles.
Can the people let us know which buildings are well managed? There should be a condo ranking page for such issues too.
AJ said: “I will assume the risk.”
– You and a bunch of other cheapo owners….so when something bad happens those that didn’t buy the “extra” insurance won’t have the $$$ to fix their units up which will bring down everyone else’s property values. Oh good show mate! In a competitive market, insurance is worth it for major expense risks.
The developer of 1800 owns 29% of the units and they’re all rented That’s not a good thing. I suspect the total amount of rentals in 1800 is near 50%. Not only was 1800 blacklisted earlier this year the banks also stated a declining market value as a reason.
I bet 1800 doesn’t have a reserve budget. Fake low maintenance fees are a nice gimmick, but don’t mean the building is being run properly. Does your 1800 have a reserve budget? Full or partial?
an aside…last night (thursday)…dead on lincoln road. it’s season people. wtf…
jcrimes, what??????!?????
OHHHH, you mean business is dead. I thought you meant that people were murdered (dead) and they were tourists (season people). That is that last thing Miami Beach needs.
AJ,
You are completely right. I hate to say it, but I agree with you on the insurance issue.
Lets assume that something hit Miami that was large enough to “flood” your >10th floor condo. It would likely destroy the whole of Miami rendering any insurance company underwriting insurance insolvent. Same goes for monster earthquakes. The only things that won’t render an insurance company insolvent is a fire (hopefully).
Also, lets say a tsunami hits Miami, you’d likely be dead anyways…..
AJ,
I have had issues with the flood insurance for condos for a while. if you buy your own policy, how does that help you? chances are, your unit actually will not take on any damage. mostly it will be to common areas, elevators, generators, etc that everybody uses. i assume the insurance will only pay you for damage directly to your unit? if a HOA has a comprehensive policy, even at the minimum, not sure if you can do much to enhance your protection beyond this.
HOA’s need to make sure they have adequate insurance to restore the building so that it is habitable and marketable in case of catastrophe… In a catastrophe scenario you don’t want to find out that some unit owners didn’t purchase X insurance and are unable to pay for repairs and the building will be uninhabitable. Regarding flood insurance, I’d have to look at the policy and see what “flood” means…..it may include water from hurricanes which is a risk that windows break and upper units flood into lower units etc….. you need to have an insurance guy come out and do a thorough analysis of the risks of each building. The bottom line is you want adequate insurance for the items the HOA is responsible for and adequate reserves set up too. Without one of those your entire investment is at risk in any condo since the building would not have money to rebuild and/or unable to have assessments to cover what should have been set up in reserves. In a condo you’re all in the same boat and I wouldn’t want to be in one where only half the people have life preservers and rations….while the other half didn’t make the proper preparations….
FYI.
USA Today – pdf link on housing…
http://i.usatoday.net/news/graphics/housing_prices/home_prices.pdf
The USA Today article is titled:
“Why home values may take decades to recover”
1800 has enough coverage to cover the common areas, generators etc in case of a flood. I am really not afraid that in an unlikely event of the impact resistant windows crash and my units takes some water damage, I am willing to take the risk.
Even if I do buy the insurance , what makes you think they will pay up. If it is wind, They say it is water damage and if it is water, they say it is wind damage. They denied payments to everyone in Mississippi after Katrina citing one loop hole or the other. Why the F will I give those bastards any money?
Auto insurance is a different thing. It is an individual occurance. So is the fire or theft insurance. But flood is mostly due to a catastrophe and the insurance companies do not have enough to cover a catastrophic incident such as hurricane or earthquake. They most likely will go under or deny you payment using loopholes or make you run around for ever to see a dime. I wont do it for a condo. If I am living in a SFH, I will consider flood insurance. But a condo, no way. That is a rip off.
Wil Bill,
In these times, having 50% reneters is no big deal. I would rather the building tide over the economy for the next couple of years than go under. It is being maintained in a pristine condition. You cannot even tell there are renters there in that building. For some reason, even the renters seem to be fiercely proud and happy to be living there and they traet it as their own. If you generally think Renters = Flamingo, consider 1800 to be 180 degrees away from that picture!
Low Maintenance is not fake. Fisrt year I paid $499 for a 2/2. Next year I wil be paying $519. You cannot sustain fake lows for that long. Why is it so hard to accept the fact that it is well managed and well run building and keeps costs low with out sacrifising any amenities? Have you ever been inside? Can you see even one single thing lacking? From the time a visitor steps off the car, all he or she sees is the courteous valet, efficient and respectful door people, Concierge, cleaning crew quietly doing their job, a helpful management, Security personnel and ofcourse all the luxury trimmings one would expect in a lux building. I saw the next years budget and there is nothing fake, no one is subsidizing anything, everything is paid for or accounted for.
Stop hating 1800 for being good to its people. I am sorry if you live in a building that is charging $1.00/sf for maintenance and still dishing out shit to its residents.
Lastly you said “Not only was 1800 blacklisted earlier this year the banks also stated a declining market value as a reason”. That is so disingenius and misleading. Each and every building in Miami are blacklisted by banks for the reason of declining market values. I know you know that. You just used that silly excuse to single out 1800. If you honestly believe that only 1800 is in that category and not every other building in Miami, then I dont know what you are doing on this blog.
AJ said: “I am really not afraid that in an unlikely event of the impact resistant windows crash and my units takes some water damage, I am willing to take the risk.”
– Oh don’t worry, I’m sure there are a lot of other people that think the same thing, so when the water comes in say on the 2nd or 3rd floor units, since insurance isn’t mandatory, and it ruins the common areas and other people’s units….guess what, lawsuits, finger pointing, building becomes uninsurable (and hence bye bye resales)….. Adequate insurance against realistic risks is absolutely important to protect your investment. I have experienced first hand what happens when one or a few unit owners didn’t have adequate insurance and something happens….nightmare, insurance rates went up 15 times forever losing out on the great low rates, much higher assessment, etc… Sorry AJ, just like you need to take FIN 101, you need INS 101 too. Why insure a $40K car for collision but not a $500K-$1M condo???? Buying an expensive asset costs money to maintain which includes insurance. If you can’t afford the maintenance or insurance (esp in condos) you shouldn’t own them. Insurance is about risks and $ amounts. If the risk of flood (however defined) is low for an upper unit than such insurance should be cheap….shop around. Also, all renter should have at least a basic renters policy too…..I know I do.
AJ said: ” I saw the next years budget and there is nothing fake, no one is subsidizing anything, everything is paid for or accounted for.”
– But you know very little about money and financing so what is your opinion worth anyway?
Looks like someone has a stake in a insurance company. What a sham. America is the only country in the World where people insure 40th floor flat for flood!! There must be a sucker for every f*cker.
I may also mention that all renters are not created equal. Yes renters do evoke a different kind of image. The likes of riff raffs and low lifes and party animals you see in Flamingo etc. But I did not find any such in my building. If they do exist, they will very soon realize that they are vastly outnumbered by responsible people. Either they will confirm or move out. My building is filled with renters who are medical students, medical interns, doctors, lawyers and other professionals. You may even mistake the place for being a hospital, with the sheer number of people wearing scrubs walking in and out every day.
I’m an intern. How the hell can these people afford 2200 a month without a roommate? Even 1K is stretching it.
A PGY-1 can make about 46-48K a year. PGY-2 make ~ 48, pgy-3 ~50, etc….
These people must be eating Ramen noodles for breakfast, lunch, and dinner!
Condo members have the option every year to vote for no reserves, partial, or full reserves. I’m willing to bet that lower maintenance fees mean the building is not building a reserve budget.
The chance of getting an insurance check in time to make immediate repairs is nonexistent. The owners need to come up with the bucks to offset the delay in the insurance check.
I’m not picking on 1800 Club. All these new condos are in trouble. You could have a building full of doctors and I can guarantee the building still will be violation of many rules outlined in Chapter 718.
AJ said: “You may even mistake the place for being a hospital, with the sheer number of people wearing scrubs walking in and out every day.”
– Perhaps they are from the coroner’s office instead and are examining a crime scene and not living there? I just heard some foreclosure numbers for these new condo buildings….keep an eye out for the January numbers….it will blow you away… No wonder Lincoln Road is dead….the free spenders aren’t coming down from NY or where ever because they got foreclosed upon…..
State killing plan for Port of Miami tunnel
This kills the Park West area condos. World Center will have problems with the streets. This area is now a huge failure.
Intern, You are right. By yourself, you cannot make 2200 rent payment. Most interns and medical students are teamed up with others to rent a 2/2 in 1800. Some medical students whose rich dad is sending them to collage (there are a few such cases) have no such issues. In any case there are 1/1’s in the building for as little as 1400, which is in the price range of some interns. In anycase the interns have no life (I am not trying to belittle anything but it is a fact that you guys work 60-80 hours a week). The only thing they can spend their salary is on a good place to rent.
There is a joke going around that 1800 is the official residence of Jackson Memorial!
Wild Bill,
I have an issue with reserves. When there are funds lying around, it leads to temptation, wastage, unnessessary improvements and corruption. I would rather not have reserves and levy a special assessment in case of an emergency. My SOBE condo has no reserves. We have been employing the special assessment route for as long as I remember. To repair and replace a major pipeline underground ($90,000), to repair and replace the dock destroyed by hurricane Wilma ($200,000) and similar such emergencies. We never had a problem with not having reserves at all. I prefer it that way.
Finally to that snake oil salesman trying to scare up everyone to buy a flood insurance for their high rise condo, do you buy the extended warranty being pushed by the salesman at the Circuit City for that thing you just bought?
If you do, you are a fool. But If you laughed and moved on as you know it is the biggest bullshit in the retail World, then you are not being honest with the readers on this blog when you advocate us to buy into that similar scam.
And by the way, even though it is not a similar subject, I studied Marine Insurance and Maritime law for 4 years and passed with an A-
I do know something about insurance.
I am not too happy with a major port smack in the middle of Miami. Like all major cities, Miami should move the container port out of Dodge Island and keep the port exclusively for cruise ships. They can expand Port Everglades for that. No one will lose jobs, only they will commute to Port Everglades. It is time.
So the death of Port tunnel is not a major sore point with me. On the contrary, if they ever move the container shipping out of the port of Miami and make it just a cruise port, The park West buildings will become unbelievably attractive.
Another reason to move the container port out is not to have the danger of terrorists shipping a WMD in a container and explode it in Miami Port. I have recurring nightmares about a scenario like that playing out in NY/Baltimore/LA/Houston/Miami. Now that US govt. has proved that it is totally impotent in controlling Iran/Pakistan’s nuclear weapons, we at least can take preventive measures by being careful.
Intern – i’m a pgy-4… It’s called moonlighting and the only way to get a glimpse of our real value during residency and fellowship. With the economy in a downward spiral, tightening credit standards, and the inevitable purge of shoddy speculators in finance and real estate sectors – the future is bright for well educated professionals with marketable skills and high income-earning potential. Whatever kind of intern you are, you have made some serious sacrifices and chosen a good career. You may be dirt poor and in substantial debt right now, but you will be in the driver’s seat when you finish training and boomers enter their health-care reliant years. Suck it up and get thru intern year… it gets better! and don’t worry, the luxury miami condo of your future isn’t going anywhere anytime soon.
Lucas,
Are your condo rankings absolute or fluid? I mean have you adjusted any criteria so far? I see that you have not made any adjustments (except that one for the Blue regarding the water front score) since the rankings have started. Things have changed a lot since then.
I will not bat for other buildings and locations. But I feel you should revisit the following:
1) Location for Quantum, 1800 and Opera (I have to swallow hard to bat for Opera but it is what it is) should definitely be 7 or 8 from the current 5.5. How can Brickell on River get 7.5 and Pace Park buildings get 5.5 in the location category, which lists proximity to restaurants, grocery stores and shopping to be a major consideration for the scoring. The explosion of restaurants, shops and food stores in the Biscayne Blvd all around Pace park since the past 1 year should enable a better scoring than 5.5. Even the last remnants of hobos are gone. On my current trip, I did not see a single hobo in Pace Park and the residents have confirmed that the hobos have moved out due to the increasing popularity of the park among families and recreational crowd. If that is any consideration for a better scoring, you should look into it.
2) In the average views column I feel that 1800 (6.5) should have the same score as Q (7.5). The views are as good if not better. Even though this is not a fluid issue, I always wondered why you considered average views from 1800 are less than Q.
3) Do you still feel that 1800 risk is still 6.5? The building is 70% closed and running smoothly with no hiccups, no foreclosures and no maintenance defaults. Any chance you will revise that score?
AJ
Thanks for the insight:
AJ, can you elaborate on the “developers can hang on to the board for three years”? I don’t understand this, and can’t find anything regarding this duration in FS 718. Thanks again.
fair Kim,
I was told about this. This is not first hand knowledge. For example, if the building opened for occupancy in Jan 2008, by law the developer must hand over the control to association by Jan 2011. But if the building gets 90% sold before that date, he should hand over the control with out waiting for the 3 year date.
Again, all this need to be confirmed by some enlightened souls out here.
House Bill 601 and House Bill 995
Here are some changes in Florida’s condominium laws that took effect on Oct. 1.
Condo buildings taller than three stories must be inspected by an architect or engineer every three years.
Condo association boards must provide condo records to condo owners who request them. The state can subpoena the records from uncooperative boards.
Associations must conduct a financial audit every two years, and must have mandatory reserves for roof repairs, painting and paving of parking spots.
You can kiss your low maintenance fees goodbye. Mandatory reserves for the win.
AJ,
I owned a condo unit. The floor above me had water damage from a leaking pipe. It damaged my ceiling and ran down the walls. Ultimately, my wood floors had to be replaced. I was glad I had flood damage insurance for my particular unit. Water damage does not just have to be a consequence of a catastrophic storm.
I’m back
🙂
Moved to Miami.
Rent at $1650
🙂
All the bells and whistles, double balcony on corner unit 1243 sqft under a/c
–
God I love Miami!
Hi to all!
Wild Bill,
I am aware of that. The things you mentioned are pittance. My SOBE condo recently voted NO for reserves. But even with compulsory reserves the Maintenance would have gone up by a paltry $20. Is that a killer for you!!??
Condo Owner,
Wrong answer.
First of all wooden floors are a legacy of northern climate. It is ridiculous to put wood floors in Miami just because they look cool. Tile, stone and marble is the way to go for the subtropical climate of Miami.
OK. Granted. You want wood floors because you fancy them. So you went ahead and got insurance. What is that have to do with my marble tiles?? If the house on top leaks , I will sue the guy for for repainting my flat or if the cost/damage is minimal, I will just settle it amicably or even do it myself.
Now are you the kind of guy who pays $400 for an ipod and buys a $149 service plan. Say it aint so. Because you will be the biggest fool of all.
Now I assume that all the readers of this blog are smart, intelligent and would reject that kind of unnessessary add on. That means you are assuming the risk yourself. If the ipod fails, either you are willing to repair it at own cost or replace it. So why would you pay an insurance company $200/month or more with the fear that the flat above will burst a pipe and ruin something. Even if that something is worth 30,000 (I am assuming you are smart enough to have non wood floors), is it worth paying $200/mo for flood insurance for some occurance which might never even happen in your lifetime in that flat? It is called calculated risk my friend. No risk, no reward.
shwin,
moonlighting…duly noted. What if no spots are available for a month? What if they cut moonlighting? What if you go over work duty hours. One of those and you can’t make your rent.
Furthermore,
I’m sorry fella but the future for health care looks terrible. What money are baby boomers going to pay with if they’re broke? We’re in a service industry.
Let me explain:
How much does it cost to get a haircut in Mexico? What about retaining a lawyer? What about seeing the doctor?
I can tell you the amount to see a doctor: $20 dollars (and that’s in Acapulco, a tourist area – and it’s negotiable!).
Now how much does a can of Pepsi cost? how about a Ford Focus? Prices are the exact same.
This country is getting poorer by the minute. Why do you think doctors bitch and moan all day? You want to talk about rewarding, get a time machine and see how much a surgeon made in real terms in the 1970s (when this country was an industrial power house). Same for internal med, same for cards, same for ENT, same for ophthalmology, etc….
also, perhaps you are unaware but the medical tourism industry to northern mexico is growing by leaps and bounds. Are you an orthopedic or bariatric surgeon? Those are the two most popular procedures for now.
http://www.medicaltourismco.com/mexico-hospitals/hospital-angeles-tijuana-photos.php (PICTURES)
looks a lot nicer than Jackson memorial BUDDY!
“Knee Replacement Surgery & Cost in India, Costa Rica & Mexico
Package Cost: 7,000~13,000 US Dollars
The cost of a total knee replacement varies depending upon where it is performed. The average cost – total knee replacement in the United States is about $40,000. The average cost of total knee replacement in our network varies from $7000 to $ 13,000.
Example numbers are India: $ 7,000; Costa Rica $ 10,500; Mexico: $ 12,500..
These surgeries are performed by the best knee replacement doctors that have experience of several successful knee replacement procedures. Many of the doctors have worked in the USA or Europe.”
HOW DO THEY DO IT YOU ASK? They pay the doctors half or less than half of what they make here (soon we will be competing by cutting our pay) and they pay nurses 1/5 to 1/10 of what they make here. And the nurses aren’t a bunch of lazy complainers either! Read some testimonials. The generic meds are much cheaper there too (we have laws against importation- thank you drug lobby). The only thing that costs the same is the machines – vent, XR, CT, duplex US, etc….
We’re really screwed up the ass when two things happen:
1. All the hospitals down there start getting JCAHO accreditation
2. Insurance plans are just now starting to cover expenses (including travel – plane tickets, hotel, etc)
Listen, I am pissed off about this. I’m just warning you the future looks TERRIBLE!
Welcome to global wage arbitrage.
In case you still aren’t convinced (I know your type, there’s no way to convince you of anything)
Some nice quotes for you ( I know your type hates to read more than 2-3 sentences):
“A hip replacement in Mexico or Thailand costs $12,000 compared with $43,000 to $63,000 in the U.S., according to a study by Christus Health published last year. Angioplasty, in which a surgeon uses a tiny balloon to open a blocked coronary artery, costs $10,000 in Mexico, compared with $57,000 to $82,000 at an American hospital. ”
and
“While the Health Net policies cater mostly to Hispanics who live within driving distance of the Mexico border, similar provisions may become common in five to 10 years as U.S. medical costs increase and foreign hospitals raise quality, said Arnold Milstein, chief physician of Mercer Human Resource Consulting, in San Francisco.
“There are a number of employers that feel globalization can have a similar competitive effect on health care in the U.S.,” said Charles Cutler, Aetna’s chief medical director for national accounts.
Hannaford Brothers Co., a Portland, Maine-based grocery chain owned by Belgium’s Delhaize Group, added an option Jan. 1 for the 9,000 employees it covers under an Aetna plan to have hip and knee replacements in Singapore. The option calls for paying business-class travel expenses for the patient and a companion to Singapore General Hospital and waiving as much as $3,000 of out-of-pocket expenses, said Peter Hayes, director of associate health and wellness for the grocer.
U.S. hospitals and doctors should take Hannaford’s move as a wake-up call, Hayes said.”
and
“Employers are pushing health insurers to implement medical- tourism options, said Milstein, who testified before the U.S. Senate on the issue earlier last year. Insurance companies such as Hartford, Connecticut-based Aetna and Philadelphia-based Cigna Corp. are studying overseas options at the behest of employers.
“You can expect that the innovators are going to be in industries that are under survival pressure due to foreign competition,” Milstein said”
WE’RE JUST LIKE THE AUTO INDUSTRY IN THE 1970s – people are getting less and less for more and more money (doctors have to see many more patients each year just to keep wages level and therefore they are discourteous and rush patients, our nurses are rude cows that won’t do an order – like CBC with diff STAT – until 4 hours later, billing dept gives people the run around, etc)
HERE COMES THE JAPANESE. WE ALL KNOW HOW THAT ENDED!
From wikipedia:
Mexico
Americans, particularly those living near the Mexican border, now routinely cross to Mexico for medical care.[38] Popular specialties include dentristry and plastic surgery. Mexican dentists often charge one-fifth to one-fourth of US prices,[39] while other procedures typically cost a third what they would in the US.[38]
This trend has alarmed American healthcare providers who, fearing a loss of business, warn patients away from Mexico. “The phenomenon has unsettled US-based dentists who tell horror stories of rampant infections, undetected cases of oral cancer and shoddy work south of the border”, claims hotly disputed by Mexican dentists. “In Texas, legislators explored the possibility of allowing health maintenance organizations to operate on both sides of the border. However, physicians in south Texas lobbied against the changes, arguing that local doctors could not compete with the lower costs in Mexico”.[40] US doctors point out that the Mexican legal system makes it almost impossible to sue Mexican doctors for malpractice.[39]
However, many who travel to Mexico for care report that they are satisfied.[40] According to a report commissioned by Families U.S.A., a Washington advocacy group for health-care issues, “About 90 percent [feel] the care they had received in Mexico had been good or excellent. About 80 percent rated the care they had received in the United States as good or excellent”.[38]
Indeed “some U.S. dentists … have conceded to the competition and begun a ‘reverse migration’ opening offices in Mexico to take advantage of lower costs”.[39] More American insurers are providing coverage for travelers, as the out-of-pocket costs to them are much lower. “With healthcare costs in the United States continuing to rise, many employers in Southern California are turning to insurance plans that send their workers to Mexico for routine care, plans that are growing by nearly 3,000 people a year”.
In addition to dental and plastic surgery, Mexican hospitals are popular for bariatric surgery for weight loss, considered an elective procedure that is not covered by some US insurers. A popular bariatric procedure, lap band surgery, which was approved by the FDA in the US in 2001, has been performed for longer by Mexican surgeons.[41]
Intern,
That is a lot of pent up frustration. I hear you my friend. Medical profession in US will be outsourced just like Information Technology. If you think India took over all the computer jobs, wait until every open heart surgery will be performed there in not so distant future. As it is the hospitals in Bombay, Madras and New Delhi are World class. They (medical industry in US) have been fear mongering saying a surgery in 3rd World countries is risky. But fear mongering is all they can do. Every one who went to countries such as India for surgery is ecstatic with the results, care, comfort, safety + a five star vacation for 1/10 the cost of the surgery in US.
So as we truly globalize, the auto worker and doctor and hair stylist will all be soon making the same money in all countries of the World. Low income countries (at least the intelligent ones) and high income countries will all become middle income countries.
And what is it all got to do with housing? Everything. That is a topic for another day.
Another Friday, another two banks go under….Sanderson State Bank, Sanderson, TX and Haven Trust Bank, Duluth, GA.
– Oh and AJ, insuring a condo….not just YOURS but damage yours can do to OTHERS is NOT the same as a service contract for an iPod or refrigerator (which I never purchase, not because those people are trying to “rip you off” but because it does not provide an adequate value to me….apparently some people buy it because they think is provides them a value, so what). You INSURE against losses you can not usually or readily afford. The vast majority of people need to insure their condos and the damages their actions can cause to other units. In the event of a major event, you better make sure that adequate insurance is there for all units…..don’t be penny wise and pound foolish. On the one hand you state 1800 has a bunch of renters which you dismiss as better than empty units then highlight the “quality” of the renters…. renters are a far bigger risk for insurable events than owner which makes it even more important to have adequate insurance. You pat yourself on the back for putting all of your wealth (no mortgage except on one) into some condos and then don’t insure them and/or want to make the building is adequately insured. Not only are those properties increasingly become a very poor short, mid, and long term investment but they are looking pretty risky right now too. Better put more than one up for sale…. Although we do disagree on things, putting that aside, I again reiterate that you are too heavily invested in residential real estate, but hey that is your choice.
I don’t think AJ needs flood insurance on a high floor but does need basic coverage since the washer hose in his flat could break and flood a dozen units below him. The developer is getting a free ride with the no reserves since he will be long gone when the time comes for replacement and the owners have to pay their share plus his. $20 reserves a month might pay for painting the building in 10 years at todays dollars but nothing else.
Reserves are nothing more than a minor cushion when something needs to be replaced or repaired. Good luck trying to collect major assessments in today’s economy. Most owners can’t get a home equity loans.
The investors who are losing thousands every year don’t have an extra $10,000 to fix a roof or replace cracked impact windows. Watch what happens when these people cannot pay the assessment to paint the building in a few years.
AJ,
I do need to update the condo rankings. I’ll try to get to it either this weekend or this upcoming week.
I should have the latest closing rates posted later today. I just got done pulling the numbers.
Lucas,
Thanks
All others with pros and cons on insurance,
You have some points , I have others. World is not perfect or ideal anyway.
If I am so confidant that a pipe/hose will burst and cause a catastrophic flood either in my flat or my neighbors flat in the life time of my ownership of that flat, I should also start setting aside $200/month and start buying lottery tickets as I might also have a chance to hit the lotto jackpot in my lifetime.
Insurance is assuaging one’s fear. In this country I see more fear mongering than anywhere else in the World. Consequently America is the most insured country in the World. J Lo insured her arse, Some one else insured their legs and so on. American ingenuity and marketing is so clever, they will market anything to anyone. The trick is to not fall for it.
In the event of a rare occurrence of a flood in my flat or someone else’s flat occurs, 95% of the time, the resultant loss should be under $30,000. I will not shell out $200/month year after year for an unlikely event. That is my view. Others are very risk averse. So let them buy flood insurance. I wont.
AJ I’m interested in 1800. The pool deck looks nice. Do people utilize it or is it mostly empty the majority of the time? Is there an oudoor jacuzzi at the pool area? Also how is the sound transmission between the condo units-specifically, do you hear the people above you walking around?
AJ said: “I should also start setting aside $200/month and start buying lottery tickets as I might also have a chance to hit the lotto jackpot in my lifetime.”
– You obviously don’t know about money and stats (nor insurance and insurable risks). Clearly $1 let’s you participate and is de minimis, the other $199 are pure waste and give you no appreciable improvement in odds compared to the value of each marginal dollar.
flood insurance is to cover flooding caused by rising water events. individuals above 25 feet should never have to buy flood insurance, including condos. this insurance should be purchased by the HOA to cover the building itself, since it is the common areas which will be affected. most locations require mortgaged and multiownership properties to have this flood protection by law. flooding from broken windows, broken pipes, etc are not flood damage. these should be protected under standard homeowner or renter policies, or hurricane policies. You should be able to get a nominal policy for about $300 year for a condo-same as rental. most buildings require tenants and/or owners to have some sort of homeowner/renters policy to protect others in the building. if you live on miami beach, however, flood insurance is a whole different story. many units are on first or second floor and susceptible to flooding. the cost out there is probably quite expensive.
from the miami Hearld:
“346 Brickell condos offered in bulk sale”
Click my name for the story.
Lucas or or others informed,
I am looking for a nice building on the ocean or bay (south of 25th street) that allows short term rentals (including renting daily). Suggestions would be very welcome.
Thanks
gables #301 very informative. I have to get to the bottom of this oft confusing flood insurance. Need to do more research. I also have to sit down one day and read 718 thoroughly. Miami09 is back! I hope you wont be Miami10 soon.
AJ,
I will be down there early next year to seriously look at some properties. I am still planning on Miami2009. Is SOBE really empty these days? What about downtown or the Arts district? Last time I was there I did see a nice amount of people about.
Miami09,
Downtown and arts district look the same. Only SOBE lost the hustle and bustle. It is of course natural. SOBE depends on tourists and they are hard to come by in the current crisis. Mainland Miami is not affected by drop in tourism that much.