Midtown 2 began closings for condo units around the middle of May 2007. Since that time, there has been an average of 1 to 2 newly listed condo units per day that have appeared on the MLS. I get notified with an email to my Blackberry whenever a new listing appears in the MLS in any of the newly constructed condo buildings so that I become one of the first to know when a great deal becomes available.
In the past two weeks listing activity has really picked up at Midtown 2. The good news is that a good number of people are actually closing on their units. The bad news is that these people are still looking to flip their condos. There’s also a good amount of units listed for rent at Midtown 2. That number will grow as more condo owners finish installing their floors, window treatments, light fixtures, etc. since the units come decorator-ready. Once that occurs, then most will likely place their condos on the market for sale or rent.
Prices at Midtown 2 have come down some in the past couple of weeks as condo owners are now realizing that units are not selling at their current price level. There have been zero closed sales and only one pending sale at this time. 1 bedroom condos currently start at $269,000, 2 bedrooms at $399,000 and 3 bedrooms at $665,000. As of now, the best deals available are the one bedroom listed for $269,000, which comes out to $328 per square foot, and the 2 bedroom listed at $399,000, or $353 per square foot.
I still feel that prices will continue to head south towards the $280-$360 per square foot range but recent prices have me optimistic that pricing will readjust much faster than initially anticipated. It usually takes about 12 months for owners to reach their “pain threshold” but maybe they are finally realizing that the market is much softer than they hoped.
An Analytical Analysis of Analyzing Condominiums
People often ask me why I chose to focus on condominiums rather than single family homes when I began my career in real estate. I guess the answer is mainly attributable to my formal education and the work experience I gained after graduating college.
As mentioned in the About Me section of this site, I graduated from the University of Illinois at Champaign-Urbana with a Bachelor of Science Degree in Finance with a specialization in Investments. After graduation, I worked as an equity options trader on the floor of the Chicago Board of Options Exchange for four years.
It became second nature for me to begin to analogize most aspects of my life in investment terms. Condominiums to me had similar homogeneous characteristics as that of a financial security than single family homes.
In my opinion, it is much easier to analyze the true market value of a condominium than it is for a single family home. A price per square foot analysis of condo units in a building, and even a neighborhood, reveals more truth than the price per square foot analysis of single family homes on a particular street or in a particular neighborhood.
A 2 bedroom condo in a particular building, in many instances, will have the same characteristics of another 2 bedroom condo in that same building, such as shared common areas, amenities, year built, square footage, appliances, floor plan, maintenance fees, view, parking spaces and so on. Any differentiations in the aforementioned qualities can be easily adjusted in the value of the subject property versus comparable properties.
It is much more difficult to assess the value of a single family home. It is common to see a small, outdated home situated right down the street from a large, recently built home. Of course there are ways to appraise the values of each by making adjustments for any differentiations in each home but it just isn’t the same, in my mind. A home buyer may fall in love with one home while he or she finds the home right down the street an eyesore.
It becomes much more expensive to turn a home down the street into your dream home than it is to turn a condo down the hallway into your ideal abode. The expense of replacing or changing the floors, paint job, window treatments, light fixtures and other elements of a condo can more easily be ascertained.
These thoughts guided me into the decision of choosing to specialize in condominiums over single family homes when I began my career in real estate. As the housing bubble talk began to escalate a few years ago, I began to think of how nice it would be conceive a way to hedge real estate investments for the average home purchaser or investor in case of a bubble-popping scenario.
I guess fellow Chicagoans at the Chicago Mercantile Exchange had similar thoughts. They created a tradable home market index based upon the Case-Shiller Home Price Index, which measures home prices based on recorded changes in home values and a repeat sales methodology.
The futures and options instruments that were enacted by the CME began trading in May of 2006. The purpose was to offer jittery homeowners a way to hedge the investment in their homes against future price declines. The CME also saw a large interest from investors to directly participate in the much-talked-about housing market.
While being a giant leap in the right direction, the CME’s housing index is far from perfect. They introduced tradable securities based upon large metropolitan areas which include the following: Miami, Chicago, Boston, Las Vegas, Los Angeles, New York, San Diego, San Francisco, Denver, Washington, as well as a weighted composite index.
However, it is difficult to adequately hedge the value of a condo in a building such as The Setai in South Beach from a condo in a boutique building in Hialeah using their index.
I have decided to create my own, localized, index. This index will be based upon market data derived from major condo buildings in Miami. I will create a graphical representation of a six-month price per square foot moving average using data of closed sales and a month-to-month price per square foot analysis of units currently on the market. I may include other relevant statistics in the future to provide more in-depth information relevant to the Miami condo market. I hope you guys trading the Miami housing index at the CME appreciate the information. I’d love to hear from you.
I plan to release an index update each week. At the outset, I will rotate Miami neighborhoods for a total of four neighborhoods (South Beach, Brickell, Arts & Design District and Miami Beach minus South Beach). In the future I plan to add Downtown Miami and Park West as its own index once the nearly constructed buildings in those areas are fully built.
I’ve decided to name my index the “Miami Condo Index”, or MCI for short. Obviously my index won’t be tradable as is the Chicago Mercantile Exchange’s housing index, but I hope that it will provide more insight to localized housing markets throughout Miami’s major neighborhoods.
The Miami Condo Index will launch next week with an in-depth look at Brickell.
I urge other Realtors throughout the country to create their own localized housing indices to fully encompass their own markets and provide market transparency to home buyers like no other.
Video & Picture Review of Platinum Condominium
I took a look at Platinum Condominium today and, overall, I was pretty impressed. Platinum Condominium is located at 480 NE 30 Street in the Design District of Miami. It is not a waterfront property but is situated just one block off Biscayne Bay, so the majority of units have a nice view of the water. Towards the end of this post I will provide my analysis on the building and discuss the availability for both sales and rentals at Platinum Condominium. I will also use the comments section to post any future listings that I feel are priced to move.
I shot a lot of video today and took a ton of pictures. The videos and pictures below will show you the exterior of Platinum Condominium as well as the lobby, swimming pool, hot tub, men’s locker room, and a few condo units. Be patient because the slideshows may take a little while to load, depending on your connection speed. I was able to shoot video and take pictures of a 2 bedroom unit located on the 7th floor. I also gained access to a 1 bedroom unit on the 10th floor but was only able to snap off a few pictures. The amenities and common areas looked about 95 percent complete which is very impressive. I would love to hear your thoughts on the building so please feel free to leave comments.
I found the exterior of the building to be quite beautiful with its curved balconies and high use of glass. The video and picture slideshow below will show you the exterior of Platinum Condominium.
I was very impressed with the lobby. It seems that white and silver are the prominent color themes throughout Platinum Condominium. It made for a very bright and clean looking lobby as you will see below.
The amenities are located on the sixth floor of the building. I found my way into the men’s locker room which had a sauna, steam room, and massage room.
The doors providing access to the club room, business center and fitness center were locked but I did take a peek through the windows. All three were done nicely. The fitness center was a bit small but that is common with most condominium buildings, especially in this price range. I then made my way outside to the swimming pool and sundeck area of Platinum Condominium. Take a look for yourself.
The pictures and video below are of a 2 bedroom plus den with 2 full bathrooms. It has 1,383 square feet of living space and a 386 square foot balcony. As you will see, the unit comes “decorator-ready” which means that the condo comes without flooring, baseboards, light fixtures or painted walls. The unit faces east and has magnificent views of Biscayne Bay. This particular unit is listed at a little under $360 per square foot.
Here are the pictures that I took of the 1 bedroom. This particular unit has 826 square feet of living space. There are also two triangular shaped balconies, one off the living room and one off the bedroom. This unit is only available for rent and is listed at $1,700 per month.
Analysis
Keep in mind that this analysis is based on comparing Platinum Condominium to similar buildings that have units with prices in the same ballpark. I am comparing apples to apples. This is my own subjective review and should be accepted as such.
Overall, I think Platinum Condominium is a great building. I like the fact that it only has a total of 119 condo units in the building. It isn’t a monster building with 400-plus units like we’ll be seeing in the coming months from developments such as Latitude on the River and The 1800 Club. Platinum Condominium has a total of 22 floors with 7 units per floor (the first 5 floors are used for parking). Almost every unit in the building will have some sort of bay view because of the way the building is angled and the fact that there aren’t any tall buildings in that area.
I’ve seen buildings with a lot better amenities and common areas but for a building of this size I think they did a great job.
In my opinion, the condo units were tastefully done. The kitchens are really nice with their granite countertops, stainless steel appliances and custom wood Italian cabinetry. There is plenty of cabinet space and I liked the fact that there is an island with additional cabinet space below.
The bedrooms and living rooms weren’t huge but they weren’t small either. The walk-in closets were rather large though. I liked the floor-to-ceiling windows which extended 9 feet high and spanned the length of the condo unit.
The bathrooms were okay. I didn’t care too much for the marble floors that they went with but that’s just my taste. I also felt that they were a bit small as they lacked sufficient storage space to keep towerls and toiletries.
The only downside to Platinium Condominium is the neigbhorhood. It isn’t a bad neighborhood, but there isn’t a whole lot to do within walking distance but that is slowly changing. A Starbucks is opening at the corner of Biscayne Boulevard and NE 30 Street by the end of the year and the Shoppes at Midtown should also be completed by the end of the year as well. As of now, about half of the stores at Shoppes at Midtown have already opened. These include: Super Target, Loehman’s, Marshalls, West Elm, Circuit City and several others. In my opinion, the area is still about 3-5 years away from being one of the premier neighborhoods in Miami. There are a lot of future development plans for Biscayne Boulevard which will eventually make it a happening neighborhood. Platinum Condominium is only 15 blocks from the Entertainment District of Miami and the new Carnival Center for the Performing Arts, a 5 minute drive to South Beach, and 12 minutes from Miami International Airport by car.
Grade:
Lobby: 8.5/10
Amenities: 8.5/10
Kitchen: 9.0/10
Bathrooms: 7.5/10
Space/Size: 8.5
Neighborhood: 6
Pricing:
For the most part, the units listed for sale are still priced a bit high, in my opinioin, but there are a few exceptional deals. There’s a 2 bedroom on the 16th floor with 1,007 square feet that was just listed yesterday for $349,900. That comes out to about $348 per square foot. For this type of building, that is already a solid deal, but if you can negotiate that down to around $330 per square foot then I think you can’t go wrong. The one bedrooms in the building right now start at $340,000. That is for a condo unit that is 819 square feet. That shows just how well the 2 bedroom for $349,000 is priced. I think condo prices at Platinum Condominium will settle into the $340-$420 per square foot range.
The one bedroom rentals at Platinum Condominium are pretty well priced but I feel that the 2 bedrooms need to come down quite a bit. The one bedrooms range from $1,500-$2,200 per month. I think those will settle into the $1,300-$1,800 price range. The two bedrooms range from $2,500-$3,200. I think those will end up going for $1,800-$2,400 per month. The building is nice but it isn’t located in Brickell, so anything higher isn’t justifiable.
If you would like to receive current listings in the building, please feel free to contact me and I will be more than happy to email them to you.
