Miami – I’m Baaaack
I arrived back into Miami last night. NYC was awesome and I was actually contemplating extending my stay until Sunday but I’m happy to be home. Being in Chicago and NYC for the past couple of weeks reminded me just how many people are in this world. Walking (or driving) the streets of Miami you kind of lose site of that after a while. Walking one city block of Chicago or NYC though and you regain that perspective.
The Real Estate Connect Conference was a good experience. I met a lot of great and insightful people and listened to some very intelligent keynote speakers. I’m not sure if the conference was completely worth the price to me but it was still a great experience and I have no regrets. I’m a very tech-savvy person though, so for a Realtor who isn’t tech-savvy this conference would pay for itself in spades.
I decided to install the “Recent Comments” plug-in onto my sidebar. (You’ll find it down the right-hand side of the screen). I’ve known about this plug-in since I began this blog but I never really liked the look of it. I’ve decided to install it regardless because I know that you all enjoy participating in the latest conversations. I’ll often receive comments on a blog post that I wrote 4-6 months ago. Unless you periodically check that post or happen to stumble upon it via a search engine, then you’ll likely never know about the latest comment on that post. The “Recent Comments” plug-in will reveal the latest conversations occurring on this blog.
Here are a few tid-bits of information:
- Plaza on Brickell will begin closings in the 901 tower within the next week. I think Plaza on Brickell is the most affordable new condo development on Brickell Avenue. About three weeks ago, one bedrooms started at $210,000. I’ve mentioned before that I feel that Plaza on Brickell will act as the buoy for the Brickell condo market. If any of you are strongly considering purchasing in Plaza on Brickell then let me know because I can now get you inside so you can preview the development and walk inside condos that you may have an interest in buying.
- Avenue on Brickell (1060 Brickell condos) will begin closings within the next 7-10 days. This means big competition between Avenue on Brickell and Plaza on Brickell since closings will begin around the same time. They are basically right across the street from one another. It will be interesting to see which offers a better product.
- As most of you already know, Bank of America purchased Countrywide Financial Corp. yesterday morning for $4B in stock (a total investment of $6B when considering its $2B investment in Countrywide in 2007). With this acquisition, Bank of America will overnight become the largest mortgage originator and servicer. BOA is acquiring a HUGE customer base from Countrywide. Countrywide, however, will have huge losses as a result of bad loans and their credit risk will now be passed along to Bank of America. On the bright side, as a few financial articles have pointed out, Bank of America will enjoy huge tax savings because of this acquisition. Bank of America, which has large annual profits will be able to offset these profits with big write-offs from Countrywide. Wall Street, however, didn’t particularly like the details of the acquisition as Countrywide lost a little over 18 percent of its value on Friday.
- The Brickell and Brickell Key Condo Indexes will likely return later this month. I have a million things to get done before that but I should be able to make the time to get that done. It’ll be interesting to see if anything has changed now that we’re a few months into our peak season in Miami.
- I plan to hire a professional videographer/editor within the next couple of weeks. Up to this point, I’ve done all the video work on my own. I’m just an amateur videographer though. Every listing that I get from here on out (and the ones that I currently have) will have a professionally made video tour. The quality will be much better than I could ever do. About 80% of the buyer leads that I get from this blog are from non-locals. I think video will help these out-of-state or out-of-country buyers tremendously when previewing properties. Many brokers may not agree, but virtual tours are a thing of the past. Video may be cost prohibitive to most Realtors when compared to virtual tours but I think the investment for me will separate me from the rest. I’m trying to find a reputable videographer/editor in the Miami area. If any of you know of one then please let me know. I don’t need a production studio but rather an individual who knows what they’re doing and can deliver great Internet-quality video. Also, if any of you developers that read this blog are interested in having your development showcased then let me know because I would love to get inside with a camera crew to tour the common areas and various units. It’s all about eyeballs these days. Get more eyeballs to view your development and you’ll get more closed sales. Miami real estate has become an international market. You’ll also gain insightful comments from visitors of this blog. You may hear someone comment “The lobby looks amazing!” or “The closets are way too small”. This is the feedback that you need to hear, even if you may not want to.
New Construction Condo Deals in the Arts District, Brickell, Downtown Miami, and South Beach
As closing dates for some of South Florida’s newest condo developments quickly approaches, the motivation from contract holders to sell is becoming increasingly apparent. I’ve been receiving a lot of phone calls and emails from contract holders, within the past couple of weeks, who are looking for me to help them find a replacement buyer.
In some cases the contract holders are willing to accept a loss on their contract price in order to retain a portion of the deposit that was made 3-4 years ago. Below you will find some of the better deals that I’ve come across:
Edgewater
- The 1800 Club
- Unit 2×04 – 1 bedroom/1 bath – 842 SF – $235,000
- Unit 3×06 – 1 bedroom/1 bath – 822 SF – $240,000
- Unit 3×03 – 2 bedroom/2 bath with direct bay view – 1,142 SF – $418,000
- Unit 4×03 – 2 bedroom/2 bath with direct bay view – 1,142 SF – $428,000
- Quantum on the Bay
- Unit 15+ floor B (south tower) – 1 bedroom/1 bath – 651 SF – $198,000
- Unit 35+ floor D (south tower) – 1 bedroom/1.5 bath – 780 SF – $212,000
- Unit 40+ floor B (south tower) – 1 bedroom/1 bath – 651 SF – $252,350
- Unit 40+ floor J (south tower) – 2 bedroom/2 bath – 1,239 SF – $399,000
- Unit 40+ floor J (south tower) – 2 bedroom/2 bath – 1,239 Sf – $409,000 obo
- Unit 10+ floor L (north tower) – 2 bedroom + den/2.5 bath – 1,460 SF -$550,000
Brickell
- 1060 Brickell
- LF Loft – 1 bedroom/2 bath – 972 SF – $360,000
- 30th Floor (K floor plan) -866 SF – $290,000
- Unit 3×07 – 2 bedroom/2 bath – 1,103 SF – $467,000
- Axis
- 1x04S (C1 floor plan) – 2 bedroom/2 bath – 1,076 SF – $340,000
- Plaza on Brickell
- Unit 2×09 (901 tower) – 1 bedroom/1 bath – 683 SF – $250,000
- Unit 2×05 (901 tower) – 2 bedroom/2 bath – 1,185 SF – $339,000
Downtown Miami
- Marina Blue
- Unit 4×04 – 2 bedroom/2 bath – 1,208 SF – $470,000
South Beach
- Continuum South Beach North Tower
- Unit ??? – 2 bedroom/2.5 bath NW corner unit – 1,491 SF – $1.86M
- Unit ??? – 2 bedroom/2.5 bath NW corner unit – 1,922SF – $3.35M
- Unit ??? – 3 bedroom/3.5 bath NE corner – 3,497 SF (4 balconies) – $4.2M
If you’re a contract holder and you’re motivated to sell then feel free to email me details of your condo and the price that you are willing to accept. Most developer contracts do not allow you to market your unit outside the sales center, so I will post general information here on the blog to see if a buyer emerges.
I’ll match buyers and sellers together. The sales centers are in some cases charging higher than normal sales commissions and transfer fees which make it virtually impossible for contract holders to get their units into the hands of end-users. I’m hoping that this blog will help contract holders to get some of their money back, end-users to find a great deal and developers to have less defaulted units. The way I see it is a win-win-win situation for everyone involved.
By the way, I’ve added a link to this post on my “Deals” page and will be adding to the list above intermittently.
Sunday Afternoon Bicycle Ride Through Brickell and Downtown Miami
Last week, I purchased a new road bike. My hope was to not only get a good cardio workout while cycling but also to get some great pictures of Miami and South Beach condos while doing so. My goal today was to get some shots of the condo developments in Brickell and Downtown that were either recently completed or will be completed within the next year. Unfortunately, it was a very cloudy day as you will see below.
Closings at Plaza on Brickell will likely begin in January. This development will add 1,000 new units to the Brickell condo market.
Closings at 1060 Brickell should occur around the same time. 1060 Brickell will add 582 condo units.
Closings at Axis will likely begin around the middle of 2008. Axis will add 718 units.
Closings for 500 Brickell are scheduled for the beginning of 2008. This development will add 633 units.
Infinity at Brickell will likely be completed towards the middle of 2008. Infinity will bring 459 condo units to the market.
I forgot to get a shot of Brickell on the River South. That development will add 322 units. I also didn’t get one today for Latitude on the River but I’ve displayed pictures of that building in the past. Closings at Latitude started about two months ago. It has 455 condo units.
Asia is located on Brickell Key. It is the only development under construction there. It will add 123 condo units when it is completed in the first half of 2008.
Closings at 50 Biscayne began about a week and a half ago. I walked in the lobby last week and it is gorgeous. I didn’t have my camcorder with me at the time, however. I will try to get a video and picture tour of the building within the next week. 50 Biscayne has 529 condo units.
Closings at Loft Downtown 2 are scheduled to begin this month. In fact, they may have already begun. It will add 496 units.
Everglades on the Bay (now known as Vizcayne) likely won’t be completed until the end of 2008 or beginning of 2009. It will add 866 condo units to the Miami real estate market.
I’ve been told that closings at Marina Blue are scheduled to begin November 1, 2007. I don’t see that happening so soon but maybe I’m wrong. My guess would be sometime in December or January. Marina Blue will add 516 units.
900 Biscayne Bay will likely be completed in the first half of 2008. It will add 516 units as well.
Closings for units at Ten Museum Park began about three months ago. Closings are still underway. It has 200 units. Marquis probably won’t be completed until the end of 2008 to beginning of 2009. It will bring 306 units to the Miami condo market.
Above is a shot of Marina Blue, 900 Biscayne Bay, Ten Museum Park and Marquis.
In conclusion, there might be a tiny bit of an inventory problem in Miami (that was me being sarcastic). I also didn’t include Icon Brickell and Epic Miami which will be completed in 2009. Icon Brickell will add 1,816 units while Epic will add 966 units. The condo developments in the Arts District will also add a little over 2,000 new units to the market within the next six months.
Advice to Miami Condo Sellers
I mentioned last week in the July Brickell condo index that only 9 closed condo sales occurred from June 19, 2007 to July 18, 2007, in the 18 buildings that comprise the Brickell Condo Index. A question was left for me in the comments section of the post about whether I felt that the lack of sales activity was a reflection of an overpriced condo market in Miami. A great conversation enfolded and I wanted to expand on that conversation with a post that will hopefully find its way to condo sellers throughout Miami.
In a nutshell, yes, prices do need to come in significantly in order for buyers to be enticed to buy. There are a lot of “motivated” condo sellers right now who have their units listed with a Realtor who are having a very difficult time selling their condo. However, sellers need to realize that their situation will become progressively worse as time goes by and more condo units come onto the market throughout the overdeveloped areas of Miami that stretch from Brickell to the Arts District. Your condition can easily turn from “motivated” to “desperate” within a six month time period.
I will let the numbers do the talking. Within the next 7 months there will be five new condo developments that will be completed in Brickell. These five developments are: 500 Brickell (633 units), The Plaza on Brickell (1,000 units), 1060 Brickell (582 units), Brickell on the River South (322 units) and Latitude on the River (455 units). These five condo developments will bring 2,992 new condo units to the Brickell condo market within 7 months. 12 months after that, another four developments will be completed in Brickell. These developments are: Infinity (459 units), Axis (718 units), Icon Brickell (1,816 units) and Epic Miami (966 units). These four developments will add another 3,959 new condo units to the Brickell condo market. That is a total of 6,951 new condo units within 19 months from now.
Over 6,900 new condo units within the next 19 months in Brickell! If this sentence alone doesn’t make a seller see the light then maybe the following sentences will. The Brickell condo index is currently comprised of 18 condo buildings throughout Brickell which consists of a total of 5,348 condo units. This means that within 19 months we’ll see a 130% increase in the number of units that comprise the index. The total number of condo units represented in the Brickell condo index will increase from 5,348 condo units to 12,299 condo units within a 19 month period.
That is just within Brickell. Include the developments below that are within 4 miles north of the southern tip of Brickell and conditions become far worse. These developments should be completed within the same time period. A few of these buildings such as Onyx on the Bay, Platinum Condos, Midtown 2 and Ten Museum Park have already begun closings. The 23 buildings below will add another 9,119 new condo units residing within 4 miles of Brickell within the next 19 months.
This means that within the next 19 months there will a total of 16,070 new condo units that will come onto the market in the neighborhoods of Brickell, Brickell Key, Downtown Miami, Park West and the Performing Arts District. The bulk of the problems will be in Brickell, Downtown Miami, Park West and the Performing Arts District since Brickell Key will only add 123 units once Asia is built.
Let’s assume that 30% of the condo units in the five new developments that will be completed in Brickell within the next 7 months were purchased by speculators. That is a very conservative number. I have heard people suggest that this number could be as high as 70%. Let’s use 30% though to illustrate a point in a conservative manner. That means that of the 2,992 new condo units to come onto the market in Brickell, 898 of these will be listed for sale. As I mentioned at the beginning of this post, there were a total of 9 closed condo sales that occurred in Brickell from June 19, 2007 to July 18, 2007. This means that if market conditions remain the same, and this absorption rate continues, then it will take 100 months, or 8.33 years to absorb the new inventory in Brickell. This doesn’t take into account the existing inventory of 1,550 condo units on the market at this time in Brickell. It also only includes those units in Brickell that will be completed within the next 7 months, not the units scheduled for completion 12 months after. Nor does it take into account the negative impact that the units scheduled for completion in Brickell Key, Downtown Miami, Park West and the Performing Arts District will have on the condo inventory in Brickell.
My advice to condo owners who NEED to sell is to get out now! Today, Barbara Corcoran was on the Today Show and suggested that people who need to sell now should be priced 5% below the currently best priced property in the neighborhood. She was speaking about homes and the national real estate market, but I think that this advice is a great start for condo owners in Miami. To illustrate, last week, two days after our office held an Open House/Wine Tasting at The Imperial at Brickell, a pending contract resulted on one of the three bedroom units that were showcased. It was the best priced three bedroom in the building and was the nicest as well. By the way, for those of you who haven’t heard of Barbara Corcoran before, she is often referred to as “The Queen of Real Estate”. She is a Realtor in New York who has had tremendous success and has been asked to appear on many nationally televised segments for her invaluable insight.
Sellers may not like the idea of discounting the price of their condo to 95% of the best priced unit currently listed in the building. However, they will like the alternative scenario even less if they don’t. Keep in mind that once the new condo units come onto the market, you’ll end up lowering your price to that level anyways. But at that time, you will be priced in the middle of the pack rather than at the front.
If you are a truly motivated seller, who doesn’t have an exclusive listing agreement with another Miami Realtor, and want to sell your condo before the worst begins, then contact me today so we can devise a plan to get you out of this mess before condo inventories in Miami reach nightmare proportions.
