The Floridian 3 Bedroom Condo Foreclosure in South Beach – A Fantastic Deal at $444,900

A 3 bedroom/2 bath condo foreclosure was listed earlier today for $444,900 at The Floridian located at 650 West Avenue in South Beach. The condo is located on the 28th floor and faces west with direct views of Biscayne Bay, the Downtown Miami skyline and Star, Palm and Hibiscus Islands. The bank is also offering a $7,000 credit at closing to the buyer. Take a look at the MLS details of this condo foreclosure at The Floridian.

The following three bedroom units have sold on the MLS within the last 12 months at The Floridian:

• Unit 2008 (faces east) – closed April 26, 2007 – $695,000
• Unit 3007 (faces west) – closing June 15, 2007 – $725,000

My guess is that there will be multiple offers on this condo by the end of the week.

Vue at Brickell – Are Prices Finally Bottoming?

On May 24, 2007, I wrote a blog post entitled “Vue at Brickell – Overpriced or Insanely Overpriced?“. At the time, the average list price of condos available at Vue at Brickell was over $550 per square foot. As many of you now know, and as the blog post explains, the inflated list prices were a direct result of the rampant mortgage fraud that occurred in the building. Since that time, as more and more people became aware of the situation and as a large number of foreclosures in the building hit the market, prices at Vue at Brickell have come down like a ton of bricks.

There are now indications, however, that prices at Vue at Brickell may be close to reaching the bottom. Buyers are finally stepping in. Since the last week of January, there have been 7 condos at Vue at Brickell that went pending. With list prices of $190,000-$199,900 for 1 bedroom condos and $220,000-$249,900 for 2 bedroom condos, it makes sense that buyers are now beginning to accept the risks associated with buying a condo in a building that has a high number of foreclosures. It will be interesting to see the sales prices of these condos at Vue at Brickell once they close. It’ll give us a better indication as to the level of motivation of some of these banks.

Below you’ll find the best deals at Vue at Brickell:

• 1 Bedrooms
  • Unit 2111 – short-sale – $162,500
  • Unit 1710 – short-sale – $162,500
  • Unit 1211 – short-sale – $162,500
  • Unit 1413 – short-sale – $162,500
  • Unit 2307 – foreclosure – $205,000
• 2 Bedrooms
  • Unit 1303 – short-sale – $229,900
  • Unit 1505 – short-sale – $250,000
  • Unit 1304 – short-sale – $279,900
• 3 Bedrooms
  • Unit 3006 – short-sale – $357,000
  • Unit 3606 – foreclosure – $379,900

The mortgages of three of the four short-sale one bedroom units listed for $162,500 are held with the same lender. This may be an opportunity for an investor to grab all three for a bargain-basement price. There are currently only 8 condos available for rent at Vue at Brickell. Within the past 12 months, the lowest that a one bedroom has ever rented was $1,300 per month. The lowest that a 2 bedroom rented was $1,550 while 3 bedrooms condos bottomed at $2,500 per month.

Blue Condominium – 1 Bedroom/1.5 Bath Foreclosure – $229,000

I was stunned when I saw this foreclosure listing at Blue Condominium. $229,000 for a 1 bedroom condo at Blue Condominium!!! In 2006, this unit would have likely been priced for around $380,000. The MLS listing shows it to be a 1 bedroom/2 bath condo but I don’t think that information is accurate, unless the owner added a second full bathroom. It is most likely a 1 bedroom/1.5 bath condo. The listing also makes no mention of it being a foreclosure but I looked it up and it is owned by Deutsche Bank.

This is a great buy for someone who is looking to purchase a 1 bedroom condo in a high-end waterfront condo building in Miami. The location may not be that great (the northern end of Edgewater Miami) but that is already reflected in the price, in my opinion. If this condo sells for around $200,000 then we’re now talking break-even cash flow with 20 percent down. I haven’t heard the term “break-even cash flow” for quite some time. Is that where prices are headed? I think we all know the answer.

Take a look at the Blue Condominium rental listings to get an idea of the type of monthly rent that this condo would bring. Feel free to export the listings to Microsoft Excel by clicking the “Export” link at the top of the grid.

By the way, for those of you not local to Miami, the highway in the picture above takes you right into Miami Beach.

2 South Beach Loft Foreclosures on Meridian Avenue

Within the past week, I’ve come across two great bank-owned lofts on Meridian Avenue in South Beach. The first is located at 1700 Meridian Avenue in a development called Montclair Lofts. It is a bi-level 3 bedroom/3 bath loft with 2,300 square feet. The unit looks to be in great condition judging by the pictures that accompany the MLS listing. The bank is asking $749,900, or about $326 per square foot. According to public records, the judgment amount on this foreclosure was $1,050,855.

The second foreclosed loft is located at 2001 Meridian Avenue in a building called Meridian Lofts. It is a 1 bedroom/1 bath loft with 1,046 square feet of interior space. This loft also appears to be in great shape judging by the pictures accompanying the MLS listing. The bank is asking $391,900, or about $375 per square foot.

Both developments were built in 2005 and are within walking distance of world-famous Lincoln Road. I think both of these lofts represent good deals, even in this market.

The Process of Buying a Foreclosure at Auction

I often receive emails and phone calls from people who would like to participate in a real estate auction but have little or no knowledge of how the auction process actually works. Paola Iuspa-Abbott, of the Daily Business Review, published a piece today entitled “Real Estate Auctions Can Help Homebuyers Gain Properties But There Are Pitfalls”. It’s a great read for anybody that wants to learn more about the auction process.

I also want to note that there is absolutely no cost to a potential bidder if they decide to work with a licensed real estate agent. The agent’s commission is paid for by the auction house from the buyer’s premium. The winning bidder must still pay the buyer’s premium regardless of whether or not they decide to use the services of a real estate agent.

Some Great Deals at Today’s Real Estate Auction!!!

I wasn’t able to attend this morning’s real estate auction, held at the Miami Beach Convention Center, but did learn the results of several condos that were auctioned. From what I’ve heard, there were more people in attendance at this auction than the Hudson & Marshall auction held on October 21, 2007, which I did attend. However, properties auctioned today sold for much less.

Below are the results of some of the condos that were auctioned this morning:

• Courvoisier Courts – Unit 2312 – 3/2.5 – 1,655 SF (Brickell Key) – $540,000
• Isola – Unit 1509 – 1/1 – 735 SF – (Brickell Key) – $185,000
• Jade at Brickell Bay – Unit 502 – 2/2 – 1,460 SF – (Brickell) – $625,000
• Jade at Brickell Bay – BL45 – 2/3 – 1,730 SF (Brickell) – $735,000
• Murano Grande – Unit 805 – 2/2 – 1,400 SF (South Beach) – Withdrawn
• Neo Lofts – Unit 1006 – 2/2 – 1,109 SF (Miami River) – $185,000
• Ocean View – Unit 210 – 1/1.5 – 1,005 SF (Sunny Isles Beach) – $140,000
• Ocean View – Unit 909 – 1/1.5 – 1,005 SF (Sunny Isles Beach) – $160,000
• The Club at Brickell Bay – Unit 2114 – 1/1 – 818 SF (Brickell) – $180,000
• The Club at Brickell Bay – Unit 2603 – 1/1 – 825 SF (Brickell) – $175,000
• The Club at Brickell Bay – Unit 3102 – 3/2 – 1,232 SF (Brickell) – $225,000
• The Club at Brickell Bay – Unit 3202 – 3/2 – 1,232 SF (Brickell) – $270,000
• The Cosmopolitan – Unit 2603 – 2/2 – 1,010 SF (South Beach) – $405,000
• Vue at Brickell – Unit 811 – 1/1.5 – 796 SF (Brickell) – $180,000
• Vue at Brickell – Unit 3606 – 3/2 – 1,551 SF (Brickell) – $290,000

It’s interesting to note that the units at The Club at Brickell Bay and Vue at Brickell sold in the range of $187-$226 per square foot. I think we’ll be seeing much more of this in the months to come. The high bidders of the units in these two buildings at the Hudson & Marshall auction simply overpaid.

The two units at Jade sold for around $425 per square foot. I think the BL45 unit is a terrific buy!

In June of this year, I submitted an offer of $440,000 for a client on unit 2603 at The Cosmopolitan when it was a short-sale. The bank rejected our offer. We were prepared to close within 30 days. It sold today for $405,000. This happens all the time! It really frustrates me which I why I rarely will deal with a short-sale. Banks just don’t get it yet! It’s a better use of my time to wait until the bank takes it back and have my client buy it for much less.

Will History Repeat Itself in Miami?

Earlier this week, I showed a few condos at Villa Regina to a lady who has owned a unit in the building since 1983. She and her husband purchased their condo in November of that year. She told me that for the first year and a half to two years only 25 condos were owned of the 208 total units. The bust had happened and nobody wanted to buy. The developer, Nicholas Morley, eventually went under and the building was later taken over by the FDIC. Nicholas Morley, was a big-time developer back then who was the equivalent of today’s Jorge Perez or Ugo Columbo.

She said that nobody would touch Villa Regina with a ten-foot pole for the first two years after she purchased because the building was either in receivership, meaning that it was undergoing foreclosure proceedings, or it had already been foreclosed upon. As a result, the common areas were under-maintained. The building didn’t have any security, air conditioning in the hallways, a concierge in the lobby nor valet service.

Before the building went into receivership, she, her husband and the condo owners who represented the other 24 units met each month to resolve the problems. They wanted answers. No, in fact, they wanted action. Each month, the condo board sent requests to the developer stating that they themselves would pay to have the building maintained 100 percent. The developer never answered their pleas.

After Villa Regina was foreclosed upon, there were rumors that Nicholas Morley wished to acquire the building from the FDIC for 10 cents on the dollar. The condo board sent letters to the FDIC to prevent this from happening. Nicholas Morley had made them suffer long enough and they didn’t wish to take any chances.

An investment group stepped up to the plate and purchased the remaining units at Villa Regina from the FDIC, a few years after she and her husband had purchased their condo. She stated that “almost overnight, there was interest in buying condos at Villa Regina”. I asked her for how much the investment group purchased the remaining units. She didn’t know but guessed that it was around 50 cents on the dollar. The level of maintenance that was initially promised had finally been restored. People wanted in because the dark cloud that hung over Villa Regina had been lifted. The investment group was then able to sell the remaining units for a profit.

It was especially interesting to hear, from the above source, that the building fell into the hands of the FDIC. This indicates to me that the bank which loaned the money to the developer also went under as well. I don’t expect buildings in Miami on the horizon, however, to fall into the hands of the FDIC for too long, if at all. The world is too widely connected nowadays. Information exchanges hands at such a rapid pace. Investment groups will act much faster in today’s era than that of the 1980s. If a bank yells, “Help!”, several investment groups will be there to say, “Help has arrived, but how bad do you need it?”.

There’s been talk that the current boom and bust in Miami is worse than had existed in the early 1980s. I’ve advised my readers time and again to watch out for the new digs. If you feel like buying, then look for those buildings that were built prior to 2000. They have much more stability because most units in those buildings are owner-occupied. Investors/speculators flocked to the new buildings and those that were yet to be built. The possibility of the above occurring in a new condo development in Miami is likely within the next couple of years. That’s why I’ve been keeping a close eye on each new development’s ability to close units. If you are interested in buying in a new development then you must be aware of the default rate that is occurring there. Those with a default rate higher than 30 percent, in my opinion, will be ones to stay away from until much of this excess supply is purchased.

The oversupply problem in Miami does indeed currently exist and is worse than that which existed in the early 1980s. However, the level of demand that currently exists far outpaces that of which was evident in that decade. Miami is now on the map. Miami now has world-wide attention. The strength of foreign currencies relative to the U.S. Dollar has made it more alluring for foreigners to buy here. It has also become a mecca for second-home buyers, retirees and those who wish to live in tropical climes throughout the year.

The opening lines of the movie Armageddon says, “It happened before. It will happen again. It’s just a question of when”. It will be interesting to see if history repeats itself in Miami and, if so, then to what extent.

2 Bedroom/2 Bath Bank-Owned Foreclosure at Murano Grande in South Beach

A 2 bedroom/2 bath bank-owned condo at Murano Grande just became available yesterday. The unit has 1,437 square feet of interior space, with marble floors throughout, and is listed at $899,000, or $626 per square foot. The price is negotiable. The condo is located on the 23rd floor and has panoramic views of Biscayne Bay, the city and the Atlantic Ocean.

The latest South Beach Condo Index reveals that units at Murano Grande have sold for an average price per square foot of $752 over the past six months.

The following are other 09 units currently listed in the building:

• Unit 809 – $875,000
• Unit 709 – $885,000
• Unit 1009 – $944,000
• Unit 1909 – $999,999
• Unit 1109 – $1,025,000
• Unit 1709 – $1,199,500

There have been two 09 line condos at Murano Grande that have closed within the past 12 months. The first is unit 2109 which closed for $950,000 on December 21, 2006. The second is unit 1809 which closed on November 11, 2006 for $1,150,000. None have closed within the past six months.

Click on the following link to view the MLS information pertaining to unit 2309 at Murano Grande. Contact me if you or someone you know has an interest in viewing this bank-owned foreclosure in person.

100+ Properties to be Auctioned This Saturday

Over 100 properties located throughout South Florida will be auctioned this Saturday in Fort Lauderdale. I’ve known about this auction for quite some time but wasn’t sure whether or not I should write a post about it for a couple of reasons. One, most of the properties are predominantly single family homes while my blog only discusses condominiums. Two, only a handful of the properties are located in Miami and Miami Beach, which is where I focus most of my energy.

I decided to go ahead and inform everybody about it though because a few of the condos reside in developments that I’ve previously mentioned. For example, two condos from Vue at Brickell will be auctioned on Saturday while The Club at Brickell Bay will have one. No surprise there!

Here is a list of some of the condos in some of the more well known developments that will be auctioned:

• Cite on the Bay – Unit #110 – 3 bedroom/2 bath – 1,475 SF
• Four Ambassadors – Unit #344 – 1 bedroom/1.5 bath – 940 SF
• Loft Downtown – Unit #204 – 1 bedroom/1 bath – 784 SF
• The Club at Brickell Bay – Unit #1823 – 2 bedroom/2 bath – 1,105 SF
• Vue at Brickell – Unit #1215 – 2 bedroom/2 bath – 1,116 SF
• Vue at Brickell – Unit #2307 – 1 bedroom/1.5 bath – 814 SF

None of these developments are particularly exceptional but it’ll still be interesting to see at what price they will be auctioned. I think the unit at the Loft Downtown has a good chance to go for around $100,000 or less.

Check out the Hudson & Marshall website for more information about this auction.

By the way, I did noticed that Deutsche Bank is now in possession of a large number of the properties that will be auctioned on Saturday.

Foreclosure Mess Victimizes Renters as Well

A few months ago, I thought about writing this post but I never got around to it. The Wall Street Journal was sitting at my office this afternoon and an article caught my attention: “Mortgage Turmoil Hits Renters As Buildings Go Into Foreclosure”.

The reason why I thought about writing this post a few months ago is because I met someone who faced the very predicament that the Wall Street Journal article discusses. I met a guy who was looking to buy a condo. At the time, he was renting a condo at The Club at Brickell Bay and his lease was going to end within six months. A few weeks after he contacted me, he was notified that the condo was in the foreclosure process. He wasn’t notified, however, as to how much time he had until he needed to vacate. The thought that “today may be the day” entered his mind each day that he rode up the elevator to his apartment.

In the past, I’ve had some clients who offered to pay 12 month’s worth of rent upfront in order to negotiate a better price. I no longer advise this because of the possibility that the landlord will face financial difficulties and go into foreclosure. Renters are required to produce a credit report and background check when becoming a tenant in a condo building. Nowadays, it doesn’t seem so outlandish to me to ask for a credit check from the landlord. I’m not saying that you’ll actually get one but doesn’t it make sense to at least ask for one?