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As we drove around the city late August, I remember saying that Everglades did a nice job with the street level commercial space. It just seemed more pedestrian friendly and accessible than some of the others. Don’t recall if the CVS sign was there, but it’s is a good thing for Miami! Keep ’em coming.
Yes, I think it’s huge for these condos with retail space to actually have retail. Besides Everglades, what other buildings have a significant retail component.. Met1, 900 Biscayne? Or is 900 targetting office space?
re: Everglades, a realtor that seems to have close ties with them and advertise on Craigs is targetting closing in 60 days although contractually, it’s been mentioned that they are supposed to have started delivering in September.
hahaha! Yup CVS opening = Miami condo market will rebound by next month! My sister is a pharmacist for CVS. They will open ANYWHERE. ANYWHERE. Let me reiterate, they make money no matter what. Demand for medicine and opiods is inelastic.
Good thing they got a CVS, the big pharmacy chains aren’t in a growth mode now to open new stores….market is getting saturated on every corner. So glad they got one while they could! Some of the pharmacies were paying absurd prices for corner lots……but that has stopped in the last 12 months. Just renting the space is more doable which is probably the case here. Pharmacy real estate holdings are going to take a hit on the ol’ balance sheet.
By the way, isn’t the CVS in Miami Beach the scene of a double murder a few months ago? I wonder how many murders will be committed in this CVS…
Mark, I was thinking more like next week…lol 😉
Is it me or does a 24 hour CVS pharmacy right beneath high end condos sound like not such a good idea?
what did the sales brochure show as a retail tennent? a high-end fashionable restaurant? an exotic spa? perhaps a whole foods? how thrilled residents/buyers must be to instead have a discount pharmacy. did they at least leave enough square footage for a “payday loan / check cashing store” or a “Chico’s Bail Bonds”??
We are still in wait mode for Whole Foods and Gardiners–hope they come too.
I think Everglades is targetting middle of the market so cheap to expensive shops can work. Across the street is BaySide. Also, I think a building won’t be considered high-end nowadays unless it’s all glass. One detail that concerns me on Everglades is their floor to ceiling glass windows. Do they use 1 piece of glass or do they have like 2/3 then a metal bar then 1/3. If it’s the latter, then that really puts a ceiling on how high end it can be marketed.
Mark: LOL
Al: I agree with you. Having a CVS on the first floor of your building is not necessarily a good thing. I guess you can go in to buy bandaids or aspirin after you are mugged. 🙂
On a serious note, this mix of commercial/residential building may work in places like sobe that have a heavy pedestrian/tourist population, but is not a good idea in downtown. Only time will tell how big of a disaster this will be.
On an unrelated note, I was in Pittsburgh last week for business. I saw and heard of many houses selling for $1/sq ft. Most “good” houses were going for $50-100/sq ft. The economy there is doing much better than Miami. I was shocked to see those prices. The houses/condos/townhosues there are pretty good. I cant stand the cold, so i would never move there, but I was SHOCKED by the huge discrepency in proces.
Hey carbonblackcab – $100/s.f. in the midwest is common even on brand new construction with lot. Old homes in less desirable areas easily go for $50/s.f.
carbonblackcab, want to blow your mind. Take a look at this palace asking at around $100/ft 30-45 min from Raleigh. Typical NC honesty, they don’t include a 500 sq foot attic and a 2,00 sq ft garage in the sq. footage. ie. a normal Miami listing would put that at 13,000 sq ft. and not 10,500.
I knew quite a few families looking at NC during the boom, never particularly understood that, but this listing explains things clearly.
home.nc.rr.com/aperfecthome/
Al, carbonblackcab, I disagree with your comment that a 24 hour CVS pharmacy right beneath high end condos is a bad idea. A few reasons why:
1) I hate to say it, but these are not high end condos. Forget about the asking prices, these will be mainstream condos for the people that work in the downtown area.
2) CVS is a great operator and that store will be a great assest when these condos get filled up eventually.
3) If Miami is to become a true “urban” city, we should be welcoming retail. All of it. Even the pharmacies, as some of these so called “high end users” are looking for this convenience too when buying a condo in downtown.
These retailers are catalysts for transformation…
Personally, I think a 24hour CVS would be great near or in any of these places downtown. The ideal in city living is to be able to ditch the car and be within walking distance of everything you need.
Get all these togehter in 1 spot, and you got the makings of a winning retail anchor
1) 24 Hour CVS
2) 24 Hour Fed Ex-Kinkos
3) Farmer’s market (normal items like bread and pepsi would be carried by the 24hour CVS)
4) Dry Cleaners
5) Quick and Sit-Down Restaurant Options
It was my understanding there are already pharmacies on each corner in that area. Or at least those people hanging around the street corner call themselves pharmacists but I am told they make deliveries but only accept cash….
I believe Bank of America is opening at ground floor of Everglades as well. It was in the recent retail space brochure.
Richard-
Whole foods is expected to open in the Met3 area by 2011. The plan of the building is being redeveloped but Whole foods structure will move forward. http://www.bizjournals.com/southflorida/stories/2008/09/15/story11.html?b=1221451200%5E1698274&brthrs=1
Wow – how exciting, a Whole Foods in 32 months…..I can hardly wait and wait and wait and wait…..ummmm, seems like plans can change in 32 months so hold onto your organically grown hats and don’t plan on it just yet!
I asked this in the last post, but since a new one just came out it will probably get lost in the shuffle. Can anyone give any input as to the bailout and market prices?
——————-
I’m hearing rumors that due to the bailout, government will refinance owners at 80% of the current market value of homes. Could this be true? If so, that is nauseating. What a great break for all of the prudent people to stood on the side, saving up 20% for something they could actually afford. Now all of those who lived way beyond their means not only get to stay in their homes, but get their principal reduced by massive amounts?
Please say it ain’t so.
Shelley, no, that sounds like a proposal from a journalist or Hillary Clinton, but a refi plan is not mentioned in the bailout. The government is going to be buying up upside down loans/loan instruments from banks and funds. Once they get them, I guess they could try to refi them but that’s probably way too complicated.
Bascially, this bill does nothing to help the homeowner who is under water right now. The next bailout package might LOL.
Shelley // Oct 4, 2008 at 2:10 am
I asked this in the last post, but since a new one just came out it will probably get lost in the shuffle. Can anyone give any input as to the bailout and market prices?
Bailout and market prices are unrelated.
JL, with all due respect, that house in North Carolina is hideous. Most people would have to spend at least $500,000 to upgrade it. From the outside, it looks like the town library.
JL: “Get all these togehter in 1 spot, and you got the makings of a winning retail anchor
1) 24 Hour CVS
2) 24 Hour Fed Ex-Kinkos
3) Farmer’s market (normal items like bread and pepsi would be carried by the 24hour CVS)
4) Dry Cleaners
5) Quick and Sit-Down Restaurant Options”
You think we could add a supercuts, starbucks, and papa john’s to that list? You think all of these can fit into the retail space of 900 Biscayne? Remember, we’re going to have a Walmart near the museums – but we’ll make sure that it looks like an up-scale, classy Walmart. Personally, I’d be happy about b of a at Everglades.
Being from Miami, it’s very interesting to see what’s going on in Downtown as this city looks to re-invent itself and find some kind of identity. Right now, I think we have a colorful mix of denial and pretentiousness with an underlying desire for cool shit to hurry up and find roots downtown. It will happen – I already see small, improvements in the live music scene down here. I do think this city is slowly growing out of it’s adolescent, porn-fiending, cocaine-binging, condo-flipping days to mature into… What? A city without any discernable plan to bring industries besides tourism, banking, cruise ships and heavy drugs into the picture. What’s our vision? Take me to your leader…
Ultimately, this city will be great to live in when there is an urban core of civic-minded, professional, cultured intellectuals who are not transients but actually live here! People who have respect for rule of law and volunteer for stuff they care about. Did you know that Miami ranks lowest in percentage of adults who volunteer? See the article here and have a great weekend. GO CANES!
http://www.foxnews.com/story/0,2933,391746,00.html
Was hoping to see higher end retail than CVS in this location given that there is already another CVS store only about 2 streets away..
With the CVS precedent suspect we will see a Sweet Tomatoes cafeteria restaurant welcoming you to the Everglades rather than a Ruth Chris steakhouse -not that is anything wrong with a cafeteria lol ,,,
george…
Yes, excellent idea. We need “higher end retail” for the millionares who will live there and pay north of $400psf. Also, maybe we should ask the City to not accept occupational licenses for these crappy stores and just prohibit renting the condos to people making less than $100k.
Bill P, Seriously what else have you seen that would compare to that 13,000 sq. ft on 3 acres fairly close to a major city?
” Did you know that Miami ranks lowest in percentage of adults who volunteer?”
This possibly can not surprise anybody that lives in Miami
We’re also #1 in another great stat. At least we beat NY in something.
http://www.careresource.org/stats.html
The Miami metropolitan area has the highest AIDS rates in the nation (52.8), followed by Ft. Lauderdale metropolitan area (45.8), and New York (45.4).
The mortgage bailout included $100 million in tax relief for Nascar race tracks—so much for end of earmarks–thanks taxpayers
are people here really complaining about a cvs?? are you guys kidding? whats better than being able to walk downstairs and pick up some shampoo, toothpaste, etc. I think its an excellent idea. some affordable eats would be nice too. I cant be spending $30 per person everytime i want to eat something.
I am not sure what the complaints are about. In NYC you can go to CVS on one corner and dine at Per Se on the other side of the block. What’s the big deal? That’s the nice thing about living in the city…choices and availability.
There is a CVS on the ground floor of my building and it is not unusual to see owners of $5,000,000+ condos shopping there. It is open till midnight and it is a great convenience to have it in the neighborhood. They also have a great security presence.
Crazy vid about forclosures in cali: http://housingpanic.blogspot.com/2008/10/when-you-put-nothing-down-on-home-and.html
Yeah, they better have security so that the shoppers aren’t victims of a double homicide.
Hey, this CVS will be great for all the high end condo owners with AIDS. They can pick up their meds easily. Now that’s convenience!
Hey DJ,
None of those neighborhoods had a CVS. Thats why they were screwed!
If socal had a whole foods coming in 32 months they would not be facing this crisis.
I just read where 45% of sales in California are REO….wow. There is so much REO inventory there that why would anyone buy a non-REO unless the price was comparable? That is, sellers will have to mark to REO sale prices. California is a bigger disaster than Florida.
It is my understanding that for every REO there is 4-5 in the pipeline. Now that the bailout bill is law, we are going to see DUMPING of these homes on the market. Don’t be a knife catcher! I may have to revise my price decline forecast based on the probable effect of this new law which will result in bulk sales and bulk dumping. The ugly just gets uglier. Sales volume will improve somewhat but with the massive supply dump prices will continue to decline causing more distress for those that need to move.
Cash is and will continue to be king. Got cash?
I see the Epicure looks to be open nearby now….no improvement in home prices yet though. If ONLY we were getting a Whole Foods in 32 months prices would really take off. Maybe we can get an article in the paper that the area is planned for one in 10 years and that hope will help???
I think everyone should chillout. How’s the parking going at One?
Wow we lost AJ and now he’s been replaced with Zilbert. Oh well, it was nice while it lasted.
I’ve noticed some recent additions to the listings are from banks with a going rate of around $200/sf. My guess is this is the new price point for banks looking to unload their properties. Assuming the properties were under mortgage for somewhere around $400/sf, looks like the banks are willing to take a 50% haircut. My guess is Comrade Paulson is also going to buy up the securities for about a 50% haircut as well (just speculation at this point) but if this were the case banks and analysts can at least put a number to asset values and losses. If this happens credit may unfreeze a bit in the future.
Emerald in particular has several low price listings. I imagine the very high hoa costs are finally forcing people to quit carrying the properties into the foreseeable future. Does anybody know the status of Emerald? is the building being maintained well? Also, next door is Sail. Not quite as nice but perhaps cheaper units. This was a building rumored to have alot of mortgage fraud? anybody know that status of this building? hoa taking care of the property? quality of life issues?
Gables, I am interested in Emerald as well. Visited last February and building looked good. I wonder how well the association is doing?
I had a very interesting conversation about the housing market (and the stock market) with someone who has seen booms/busts in both markets for the last 40 years. Following is his answer to my question. The answer is not an exact quote….i am paraphrasing his answer.
When will the housing market bottom out?
When people stop caring about real estate market. When they lose all hope that it will ever go up is when the market will hit bottom. There is way too much interest in the market right now. Bargain hunters are salivating like pavlov’s dogs … waiting for good deals. With the high level of interest we have in Miami real estate, there will be some false bottoms. The real bottom will be reached when there is total hopelessness in the market and only people who will be buying are people who need a place to live (and not necessarily looking for a hot deal).
Mark Zilbert (AJ the name caller?) – You must not like me, oh well. Keep on posting the gross posts and I guess the powers that be will continue to delete them. Shoot the messenger if you want…hard to do over the Internet. I don’t care. You’d be better served by getting out of your real estate positions then to post attacks against me. Oh well, I really don’t care about your silly posts…they’d be more humorous if you’d get off your obsession with women’s menstrual cycles though since that is just weird.
Carbon – I’d have to disagree with his idea about when the “bottom” will happen. I mean – I don’t know that people were exactly “hopeless” during the pre-boom real estate era. People just saw owning a house as a “decent” investment (not a get-rich-quick scheme), and a place to live.
The problem we have right now is simple: there are too many houses/condos and not enough buyers. Supply of housing is at an all-time high, and demand is at an all-time low. When supply exceeds demand, prices go down. I think we’ve already bottomed as far as sales volume. However, we haven’t put a dent in the huge multi-year inventory in this market. That will happen very slowly. The flood of foreclosures has to stop, as well.
Unfortunately, I think this bailout plan will actually make it worse for people waiting for the bottom. It won’t stop prices from falling, but may push the bottom out several years. When Japan’s bubble popped, they tried to prop up their banking system and hide the crap on the banks balance sheets for years (just like the USA is doing right now). Real estate prices went down for 13 years.
So – who knows how long this thing will take.
What is interesting in the whole psychology thing regarding housing is that almost no one has an incentive to talk housing prices down, hence nearly everyone talks them up resulting in unreal expectations.
In this housing cycle, it would appear that the cost of ownership will have to match rents to get people to buy. We have a very long way to go for that. The rest of the world is retreating so there are no foreign “white knights” to prop up this market.
Foreclosures have not peaked. It is estimated, and I pretty much agree, that most of the no doc and 2-28 loans written from 1/2006 onward will default.
Cabo!
Oops! Lets not forget that rent is a moving (downward) target. This is knife catching on top of knife catching. Very troublesome. CABO SAN LUCAS! LETS ALL GO TO CABOO!
RT, there is a segment of society that has argued for price decreases. They are the responsible savers who followed the rules and were left on the outside looking in. Nobody wanted to listen to us, however!
I agree with the comment that the housing cycle must move through a phase where cost of owning and renting are very comparable. Until this happens, there is really no incentive to get people back into the market place. Each month that goes by i see a drop in both rents and sale prices. sale prices will have to drop to the point that buying a house is not that much riskier than signing a 12 month lease. and if the economy and jobs continue to deteriorate, even a $300k 2b/2b will be way overpriced. if the economic conditions are still bad in another year, those units could easily go for $150k. if the conditions improve, prices will stagnate for a while. this is the risk component of pricing and currently is quite steep.
I am very curious about how the banks are going to handle the foreclosure and new mortgage issuance dilemma. The passing of the latest bailout has already nudged banks to start moving more units back into the market. Foreclosures will continue to drive down prices. New buildings that have say 20% of units foreclosed will dominate the lowest comps for quite some time to come. And these foreclosed units should be used as comps since they are the units moving the market. Banks will have to take a haircut in order to price these units in a way to move them off of their books, even at a loss. The question is, who will then give credit to somebody to buy the property again? Do the banks really want to bring these properties back onto their balance sheets, even at a lower principle? I have seen countrywide offering foreclosure properties for sale but insisting the new owner finance through countrywide. i see countrywide wanting to sell the property for as much as possible, but if it is financing a property it desires to finance at a minimum price to allow for risk. any ideas on which viewpoint will dominate bank action?
gables – The unemployment outlook is not good. Peak unemployment probably will not happen for 2-4 years. It will get to 8% unemployment pretty much that is a given, will it get to 10%? I don’t know but it is in the realm of real possibility. Home prices are tied to rents which are tied to incomes which are tied to employment (actually you can skip the “are tied to rents which” and it would still be a true statement but included it to make a point to provide a target for where current home prices are going since rents weren’t as unhinged to incomes as home prices). With unemployment increasing there will be downward pressure on real wages as employees compete for jobs…that will put a long-term cap on home prices for sure and pretty much sink any possibility of a return to “homes as investments” mentality. Just think of all the government cutbacks that will be needed in the South Florida area…even Cali is borrowing from the Fed Govt and Cali has a HUGE and DIVERSE economy (but also the worst housing bubble in history).
The bottom line is housing (and condos) as investments will be dead and will continue to be pounded into the dirt for many years to come… It may be a harsh assessment but come back and reread it in 2012 and you will agree.
BFG: I wasnt suggesting that things were hopeless before the boom. I am suggesting that the current real estate market has too many people waiting on sidelines to pounce. That situation creates many false rallies as people jump in at the wrong time. My suggestion of hopelessness was to indicate that the market will reach equilibrium when people buy condos/houses to actually live in them and not view them as investments…i.e people buy when they absolutely have to i.e someone moves to miami for a job and buys a place to live in.
Renter Tom : I agree. Prices have to come down so that rent:own ratio is 1:1. Here is the dilemma: If the Rent to Own ratio become 1:1, condos would sell for $0 when you take into account the HOA and property tax (which is based on the high valuations).
I had been watching the sobe market for a condo very closely as I was interested in buying a condo that I coudl rent out and crash on weekends (if it was no rented). I no longer am looking. My money is better invested in money market accounts and in the future in index funds for Financials/HealthCare/Alternative-Energy/etc.
Does ANYBODY have any thoughts …input on 188th Street in Aventura??? It is a fairly new street close to the Aventura Mall.Please HELP I’m considering purchasing very soon.There are quite a few REALLY GOOD DEAL’S there now.The Atrium …Uptown Marina Loft’s …3030 …and Eastside.. are the 4 main buildings on the street.
Waiting, I’m sure that some of the Regular writers on here would have a wealth of info. that could help you out with any decisions you might have.Renter Tom where are you. LOL all the best
Not familiar with too much non-ocean front buildings in Adventura. Would recommend getting a condo assoc. budget and balance sheet as a prudent first step along with # of units rented, etc. Condos are like being in a lifeboat together, what one owner does affects everyone else and in this climate getting everyone to row in the same direction can be difficult…it may be every man for himself now. Good luck.
Waiting, take time out on a Saturday/Sunday afternoon and talk to some residents and the valet/doorstaff. You’ll find out any issues real fast.
——–
On a different note, one thing that makes this Miami condo situation way different than any other Boom-Bust housing cycle is that the holding costs are so high for this type of RE. You can talk about previous RE busts and try to extrapolate, but those busts didn’t involve property with Miami type HOA and taxes.
Any bank/developer on the hook right now for a lot of unsold inventory is sitting on a time bomb. You get the feeling if one of these projects anywhere goes belly up, it’ll have a domino effect since condos in Miami are very comparable with each other.
carbon
in the 80s, condos did go for nearly $0. the banks had to unload them and as long as you were willing to pay the taxes and HOA, it was yours. ask any old time financier/lawyer about brickell
note to anyone living in Plaza on Brickell or visiting: NO NOT, I repeat, DO NOT under ANY circumstances valet park in that building. was exiting today with some complete jackass right behind me driving recklessly, squeeling their tires, and tailgating me dangerously closely. imagine my surprise when that driver later went into the drop off point to deliver someone their car.
Thank you SO MUCH Renter Tom & JL for your information.You are both right on…with your info.THANK YOU AGAIN.
With all this gloom about the economy, housing and credit crunch, it is surprising to see that half way around the world, in Dubai, they are now planning to start constructing the new World’s tallest building even before the current tallest building in the world, also in Dubai, has been finished.
The RE prices over there are just going through the roof inspite of Dubai being in the middle of a desert. It has definitely transformed itself from a sleepy fishing and pearl mining village to a dynamic shipping and economic hub of the middle east, but seriously any idea when and how badly will the RE over there might crash??
Kudos to them though, they made seemingly impossible projects a reality with the Palm & World islands, indoor skiing center in the middle of desert, world’s tallest buildings etc…. Hmm, back to our dismal reality here in US
Roger – Few places will be immune and Dubai has had a ton of speculation albeit there are quite a few ridiculously wealthy doing it who can afford a fall. Any area that got a big boost from the easy credit will at the very least of a bit of a decline, even Manhattan…
See also:
Manhattan real estate: Pricey but headed for a fall
The average sales price continues to climb – it’s now $1.4 million – but the number of buyers is falling fast.
money.cnn.com/2008/10/02/real_estate/manhattan_real_estate/index.htm?postversion=2008100304
waiting…
I like that street a lot and love Atrium. Some units sold in the peak at north of $400psf and the developer is now selling at $300psf (no flooring)… The developer has about 30 units left (after 1 year of closing, 192 units total) and there are 30 units in MLS for sale with 10 for rent. 31% of units for sale is not good news for a new condo and HOA fees.
I made an offer for $260psf for a 2BR unit and it wasn’t accepted. Not sure I want to counter as all of these numbers scare me a bit. The developer hasn’t paid off the construction loan after more than 1 year of closings and I gotta believe that the prices HAVE to come down.
Not sure about the other buildings… I haven’t seen them, but I hear there are lots of units for rent in Uptwon lofts, even for weekly rentals. I also heard that Artech is about to start closings soon (sold at over $600psf) and I bet no more than 30% close.
If you get any more info, please share.
Thanks
Looks like Jade Beach has started closings in Sunny Isles Beach??? Anyone know any specifics. Looks like it is an expensive building with really high HOA dues. Will be interesting to watch as Trump Towers compete for who will close the least….my bet is TT III will have the fewest closings as a %.
Nothing like having a $19,500 tax bill on a 1,085 s.f. unit, nope that is not a typo. Jade Beach should have been called diamond beach.
On a positive note, all of the home owners out there with $100,000 kitchens with professional grade appliances can actually start to use them since they won’t be able to afford to eat out at restaurants anymore… They must have had a lot of foresight….now we just have to decide where to put the chicken coop.
hahah! Check this out:
http://www.miamiherald.com/news/southflorida/story/713542.html
Renter Tom, carbonblackcab, gables & jcrimes, I really enjoyed your posts. Serious analysis I have only seen at HBB.
It’s close, but the one that brought the biggest smile to my face was jcrimes:
jcrimes // Oct 5, 2008 at 6:07 pm
“carbon
in the 80s, condos did go for nearly $0. the banks had to unload them and as long as you were willing to pay the taxes and HOA, it was yours. ask any old time financier/lawyer about brickell”
–
I’m neither of the 2 above but I do remember.
Man, it’s invigorating to hear from intelligent/knowledgeable people. So much BS in MSM.
Mark – All I can say is the lady needs to help herself first before “helping others” sorta like that airplane instructions to put on your oxygen mask first before assisting others. You can’t help most people just by giving them something, they need have a part invested in it too. It is also like the able-bodied guy in poverty who wins the $10M lottery only to be broke three years later. The guy can’t manage his money or spending, that is why he is poor even though he is able-bodied with an average IQ. By the way, this isn’t the first extreme makeover home to have troubles, I remember reading about another that was HELOC’d or something to foreclosure.
My favorite is the fat nuns working at a food pantry talking about the endless need and that the need is so great to give away food…the lines are long and they run out of food. Duh, a lot of people would rather spend 20-30 minutes in line to get $50 in food than work to earn $50 bucks and go spend 15 minutes shopping and another 15 minutes in line to hand the cashier the $50 bucks. Silly nuns…..and I’m a Catholic that tithes 10% of my pre-tax income…. Charity just handed out isn’t charity. For those truly in need where they can’t contribute is one thing and should be determined on an individual basis, but just standing in line doesn’t qualify in my book.
Here is a banker I agree with:
http://www.ingdirect.com/wethesavers
Great posting of Miami Beach govt. salaries . Wish more information like this made it out to the public more often.
I see the Fire Marshall Sonia Machen clocking in with a $152,960.26 salary. 5 years on the job now.
Miami Beach Labor force earning of $49,999.99 a Year and Years of Service
http://www.citydebate.com/florida/miamibeach/template.php?url=0109150801.htm
Hi Guys,
I came across this article and desided to post it here…..
Ways to wiggle out of new real estate contract
http://www.marketwatch.com/News/Story/Story.aspx?guid=47a72c1c38d943ddaffd9e699b5fb09d&siteid=nwtreal&sguid=e5aseQUsOU253la_llVqmQ
What do you think? Is it possible to get out of the contract if you fail the finacial requerement? It shouldn’t be hard these days…..
RT – why do you think Trump will have trouble with closings? Of all of the new SIB buildings, the units I’ve seen for sale in Trump seem to have the best bang for the buck. The units are really nice inside. Of course they are very pricey, but when I looked up what the owners paid pre-construction, it was fairly reasonable. When prices come back down to normal levels (normal probably being under pre-construction), I’m going to be looking at Trump.
Shelley – Take a look at Trump Towers and report back. I had heard that the third building was most expenseive s.f. We’ll see on the closing rates as things move forward. The bottom line is there are a heck of a lot of $1M+ units coming on line and a lot of dark windows at night in the ones that have closed already….wait and see.
Well the strong leverage tailwind has shifted into a headwind…. Home prices will overcorrect on the downside, I don’t see any other outcome as probable. Whether we get to $0 and just pay taxes and HOA fees is an open but improbable outcome. Who knows.
Not surprisingly Mortgage Equity Withdrawals have gone to ZERO. Ties right into the slump in consumer spending… Home ATM is gone.
I saw the HELOC stat. Amazing, absolutely amazing
Ok, so we got a Global recession with Asia, Brazil, Russia, Europe all joining the party. Who’s the Related fund going to flip their condos to?
oops, add canada to that list,… can’t leave out the Canucks
Well when the politicians and pundits were warning that if they didn’t pass the $700B bailout that people could find themselves going to an ATM without cash….well, a little late, the Home ATM apparently was shutdown way before the $700B bailout….I guess banks aren’t entirely stupid.
Muir
those were amazing days, at least the way the story is told to me. not sure we’ll see a repeat of that cycle considering the amount and knowledge of today’s investment pools, but if it did go down like that again, wow.
I would love to see $0 condos with only hoa and taxes-you would essentially break even in monthly cost with rents these days! dont suspect this will occur, but i do believe we could see very steep price declines over a short period of time-demand will not allow these prices to stay low at much volume for long.
price points at vue and the club should continue to serve as a lower bound on the new condo market. emerald is certainly starting to struggle and face this issue if the latest listings are an indication. a couple of years ago if you had said the dow would be below 10,000 people would have thought you were crazy-so $0 condos is not all that far fetched…
FWIW, I just noticed this 9-10-08 sale.
Marina Blue #3701 (2/2, high floor, great line corner unit) at $405K for 1,315 sq ft. ($308/ sq ft).
What’s amazing is people (like Lucas) talking about prices holding up at 400/sf with other people talking about a great depression!!! I love you Lucas and I’m going to use you as my agent, but you have got to get more realistic about future pricing bro.
I really think AJ was the victim of a margin call or a repossession of some sort. Where is he? DO you guys know what building he bought in? If you suddenly see 3-5 new listings from that building that could be his forced liquidation. I hope he’s physically okay, but he deserves to lose his money for making such ridiculous business decisions.
Mark – Lucas is in the business and part of being in any business is to be optimistic (not critical) otherwise you’d just quite and work somewhere else. I think Lucas has been within the limits of acceptable optimism but that doesn’t mean he is right. This unwinding is happening a bit faster than expected. My next evaluation after I get through this week is to review cash…I am somewhat concerned but haven’t found an acceptable hard asset. Gold is bubble….I do have one idea, but I’m not telling……..these are serious economic times although I am not even near a panic, I’m just at a concerned vigilance stage. We may be near a stock market capitulation where people just give up….I’m looking to increase my stock holdings…..but not just yet.
Maybe AJ had it right to be chummy with your tenants….at least you’d have a place to crash instead of under a bridge.
“FWIW, I just noticed this 9-10-08 sale.
Marina Blue #3701 (2/2, high floor, great line corner unit) at $405K for 1,315 sq ft. ($308/ sq ft).”
That’s not a deal! Other buildings like 50 Biscayne are hitting lower already and still not selling. I’d say $180-$200 a sq/ft is a deal. Besides those corner units are BS at MB. They are ridicoulously small. Views are nice but the Building Structure Pole that runs right through your lving room takes up just that…your living room or atleast 30 – 40% of it. They should have designed that to be outside not inside.
Besides that unit is not 1315sq ft it’s so damm small i’d say more like 1000-1100 actual under ac.
Tom (post #80)
The bailout was $850B. Apparently when it was “only” $700B it was considered too much of a taxpayer burden, but when they fattened it up with an extra $150B of pork and corp. tax breaks, it passed no problem.
I’ll be voting against any incumbant congressman (dem or repub) in the next election.
DJ
i don’t think that’s entirely fair. i think you should vote against any incumbent who changed their vote to yes from no. frankly, it’s intellectual dishonesty which should be condemned; not making a choice between two bad policy decisions.
Once Again,
The Marina Blue unit isn’t a particular deal in my mind, but it’s a posted sale so it gives you an idea of an actual transaction where a buyer met a seller in Sept.
Hopefully we’ll start seeing more sales in 900 and Marina Blue. However, if you start seeing more sales like that at this point in the cycle, then Everglades is in for a lot of trouble IMO.
I’m glad to see that a drug dealership has come to Miami as one would have to be on drugs to pay any price above $125.00 per square foot for a condo with a view.
The Smart Money
I like the Ace. Hes like a character from a frank miller graphic novel. He comments like once every two weeks
Mark Zilbert – I know it is tough to have lost a lot of money in real estate, but your obsessions require you to seek therapy. Good luck. Even if you can no longer afford one of those downtown condo beauties, I hear there is a homeless shelter nearby so you can live the lifestyle just like those condo owners, with everything within walking distance, a Wal-Mart on the horizon and in 32 months a Whole Foods to panhandle by. Is that just swell?
I think the Everglades will have alot of defaults..way to many units that sold at way to high a price.
Looks like a better version of the LOFT Building. Worth more than the loft building but seriously not as much.
Can someone say sky high HOA fees!!
JL, Tom, JCrimes, Mark(Not Zilbert) great comments.
Obviously we are in a deflation, metals, commodities, housing, even oil.
Yesterday, I was ecstatic as the market was going 500 then 600 then 800 points down. True bliss.
Trillions of dollars no longer exist. This makes the few that I have more valuable.
Considering an economic slowdown, people will have even less dollars available and the few that they have will go towards basic needs, the dollars I have (in certificates of deposit and in safety deposit box) will be even more valuable.
Yet, at some point with two wars, trillions in debt and monster deficits, inflation will set in and wipe out my cash position.
Yes, I can buy a lot more today with my cash than I could 4 months ago, whether that be a condo or a boat (steeply discounted.)
So, there’s the game, at which point to buy something real (solid) even as those are increasingly more attractive buys.
None of us can predict the future. The nicer condos under $200 sq/ft? Very likely. Under 150? Under 120?
What may seem like a screaming buy today may seem like a fools gold in 3 months. Yet, there’s that dagger of inflation/hyper inflation in the future.
Well, these are interesting times.
Muir, You are right. Damned if you do and damned if you dont. Yesterdays Herald story talks about the Europeans who had a great advantage earlier with a strong Euro. But they waited on the sidelines for the market to bottom out and lost all the exchange advantage due to the eroding Euro. Similarly your inflation/hyperinflation analogy might also holds true.
We will see if the Europeans lost out. The smart ones would have exchanged their currencies (tax free I might add!) and are still waiting to buy. While I doubt the impact on the Miami housing market will be significant from such moves I did want to point out that it can be a two step process. However, with European asset prices also falling, I doubt the enthusiasm to buy a piece of Miami real estate is as strong as it was 2 years ago…
Is the “foreigners are going to save this market” idea dead and buried yet?
Latin American and Russian economies are going down the tubes. Euro could be toast. Shanghai stock index is down almost 70%(!) since last year. Dollar is rallying against other currencies big time.
Everything the Fed and Treasury have done so far to try and deal with this credit crisis has failed spectacularly. $700B bailout gets passed Friday, and the market tanks 450 points. Monday, it tanks another 800 before a short-covering rally recoups some of the crash. LIBOR is soaring. The ‘TED spread’ (measure of turmoil in credit markets) is breaking records.
Anyone who thinks we’ll see a quick recovery of any market is delusional. We’re in for one hell of a nasty global recession.
Yeap.
BFG – Yep. For some reason I think the US will fair better than the rest of the world when all is said and done. BRIC is falling….well, like a brick.
The European banking system is on the brink of collapse and because they don’t have the structure we have. Individual countries have barely more power than a US state because they have ceded their fiscal policy sovereignty to the central bank as part of the Maastrich agreement which formed the European central bank.
This is similar to what would happen if we went back to the gold standard like some on this board have suggested.
Lets hope the US never does something as dumb as that. There has been conspiracy theories centering around the creation of a north american currency called the Amero. Don’t think many Europeans are going to be speculating or parking money in miami condos but they are certainly cashing in their dollars for Euro’s.
there’s a lot to be critical about with the treasury’s efforts (and by extension, the president giving paulson and co. the green light). that said, they’re taking bold action and thinking outside the box. the comm’l paper announcement today was brilliant (although b. gross from pimco has been advocating this for the past few weeks). if all of this fails, it won’t be because of a lack of effort. rather, we were doomed from the start.
i liked the piece in the herald about euros/latins and their interest in all things s.florida. RT is right – you didn’t have to buy a place immediately just because the currency was up. you could have converted and then waited for s.florida RE to come down and moved in. that’s the not even smart money play. of course, regardless of economic means, there’s always a moron to be found…especially in s.florida.
To all you financial wizards: I have been investing $500 @month in a Roth IRA with T Rowe Price Emerging Markets mutual fund that concentrates heavily in BRIC (brazil, russia, china and india). I have a high tolerance for risk and dont need the money for 15-20 years, its no-load, low expense fund. With the global slowdown/recession afoot, would you keep throwing money in there ?
dobieman – Is that the ONLY place you are investing in…emerging markets??? High does not necessarily mean high reward… BIC are good, Russian…I don’t know. 15 years may not be a long enough time horizon. My stock asset allocation (just stocks, not all of my assets) targets emerging markets at 5% of stocks (again not of all assets). Some people go as high as 10% of total assets….I just don’t have the confidence in the transparency and truthfulness of those markets for that much exposure. Just my opinion.
dobieman, I think most of the emerging market funds are a function of commodity prices. The commodity complex is being slaughtered right now on a scale equivalent to the nasdaq 5000 .com meltdown. However, steel, oil, coal, and other commodities related firms are not comparable to pets.com fundamentally. They actually produce something that there is demand for in the long run. Also, china is taking steps to reflate. So I’d would average-into BRIC right now possibly minus the R. The big risk is Europe. Stay away from or short anything European.
thanks for your response, luckily i have a 4o1k with a great deal more diversification, the Roth is not my only retirement investment vehicle. thanks again – I appreciate your input and thank Lucas for this excellent forum which i read religiously
I think your strategy will pay off big time eventually dobieman. It might take a while, but it will perform amazingly. At this point with markets off like 60% and their currencies weak against the dollar, it might be a spectacular buy. I see great things for the real, yuan, and rupee eventually. Most likely in 5 to 10 years tops. Thats my opinion but ask RT. He knows his shit.
Dobieman:
If you don’t need the money for a long time and is truly risk tolerant invest in the new frontiers funds. Economies like colombia, panama, and others which are on the view of investment banks as the economies that in the next 10 years will be the new emerging markets (just like BRIC was 15 yrs ago) The growth of the BRIC funds will not be as steep as it has been since those economies are reaching their maturity and they are becoming service economies)
Another option that you may have is to invest in climate change funds which will definitely give you exposure to a different sector which most researchers find to be the sector with the most potential on the long term due to the changes in our world.
Stocks stay near peaks after housing data 25 minutes ago
NEW YORK (Reuters) – Stocks stayed near their session peaks in choppy trade on Wednesday after a report by the National Association of Realtors showed a surprise jump in pending sales of existing U.S. homes in August.
The Dow Jones industrial average was up 160.33 points, or 1.70 percent, at 9,607.44. The Standard & Poor’s 500 Index was up 23.43 points, or 2.35 percent, at 1,019.66. The Nasdaq Composite Index was up 41.64 points, or 2.37 percent, at 1,796.52.
Random comments.
Looks like there is a market for homes at 50% off, well at least in California! Home sales are up, but looks like foreclosures are still rising and inventories aren’t going down. Credit is still really really tight regardless of any rate cut orchestration.
I find it interesting that the more Obama gains in the polls the lower our asset prices get. A populist rockstar media created persona won’t last long once we see the messiah has no miracles and is a false prophet. Every tool in the fed toolbox has been out and still no hope of averting a nasty recession around most of the world, perhaps avoiding a depression though. When the 18-28 y.o’s who vote for Obama find themselves unemployed through 2012, we’ll see what happens. Whoever is elected president in 2008 won’t be reelected in 2012 whether it is McCain or Obama. The long term macro drivers simple will not permit a robust economy and 4% unemployment in 2012. I find it very ignorant when I hear people that the presidential election is going to fix their bad financial decisions…..unbelievable. The only person that is responsible for your poor financial position is you and the only person that can fix it is you, period.
Enough pontificating I suppose. On a positive note, housing will continue to get less expensive but “affordability” won’t mean much for those in 8%-10% unemployment category with traditional lending standards.
Lastly, I just saw on TV that demographics and household formation will solve this housing problem…yes, time will allow the inventory to be absorbed eventually since we don’t have a plague killing off 1/2 the population but you also have to factor in the historical increase in one person household formation which will be going in reverse……
Remember high risk has no correlation to high reward potential. However, high reward potential usually has high risks…..
Tom, I agree with you 100% regarding the comment
“Whoever is elected president in 2008 won’t be reelected in 2012 whether it is McCain or Obama”. They will be inheriting such a shitty economy, it will not be business as usual until 2013 or later. Voters will punish the incumbent prez whether it is his fault or not.
Renter Tom,
I think it’s the opposite, the more the asset prices decline, the more Obama gains in polls. Might be because McCain has done a terrible job in showing people he knows what he’s talking about in terms of economy while Obama has portrayed a better understanding.
But, it’s true that the next president will have a tough job ahead.
Roger – We had an Obama market flight earlier in the year and the cause and effect now is uncertain. Who wants to invest in the U.S. if taxes will be increased…DURING a recession? At the very least, it will curtail investment dollars at the margin, how much I don’t don’t know. It is the wrong message at the wrong time to increase taxes even if plays to the populist crowd…but hey promise the world to get elected I suppose. Being the font of “hope” and “change” when in reality we’ll get a nasty recession, higher unemployment, and more govt. bureaucracy and intrusion in one’s life instead of change is setting expectations up for a huge fall. At least McCain is telling more like it is. It is just my biased opinion. I suppose give the people what they “want” and let them get burned…so unnecessary.
The urbanites living paycheck to paycheck will find no relief under Obama. Their future is in their own hands not the false hope of Obama’s promises. The more important issue is getting these people a high school education or a GED. Without that foundation and basic self-motivation, there is nothing you, I or daddy govt. can do for them. Words are one thing but real action is another.
The next republican candidate in 2012 just needs to use the Obama campaign playbook against him and he’ll win all 50 states…
“Cook County sheriff to suspend foreclosure evictions
October 8, 2008 at 10:12 AM | Comments (0)
The Cook County sheriff’s office announced this morning it will suspend its mortgage foreclosure evictions in light of the national foreclosure crisis. Details to come.
Further details about the suspension will be released during an 11 a.m. news conference at the Daley Center, 50 W. Washington St.
CLTV, Chicago Tribune”
– Yep, that’ll help. Let’s reward the condo flipper by letting them live for free…why bother to pay your mortgage, taxes, or HOA fees in Chicago???
RT, so you support the CEOs and Big Oil getting the big tax breaks and the average joes paying for these people? That’s what McCain is suggesting. McCain has made really horrible choices starting with the selection of “hockey mom”, who seems to be dumber than Bush himself. Can you really see her being the next president when she thinks that dinosaurs existed 4000 years ago?
McCain might be good news for the over $250,000 crowd, but these people won’t have their jobs if McCain is elected, he does not seem to comprehend what’s going on with the economy
“I think the Everglades will have alot of defaults..way to many units that sold at way to high a price.”
Everglades is a great building but its taken way too long to construct. Longer than contractually agreed. I think people wanting to opt out will have a strong case to pull out unscathed, especially how the current market is today considering closings are a couple of months away. I can’t imagine ANYONE, who bought early, closing on their units but Cabi has shot themselves in the foot by underestimating construction times so I’m sure they’ll have several pushers on their hands but the question is, do they have the means to push back or will they just chalk the deposits as a loss and start over again at today’s adjusted values?
Not too savvy on what happens when a building goes over the contractual timeframe…anyone have experience with this? I would imagine that the developers fight those deposits to death.
Roger – I don’t agree with your post at all. Come back in 2011 and read my post to see if I was right. I’m all for letting big oil drill drill drill to get at US oil reserves instead of being dependent on the middle east. Energy is fungible and we’ll use whatever is cheapest….oil, coal, solar, wind, water power, nuclear, whatever. We need to have advanced technologies in all. I am hoping solar and wind can get to the economic tipping point to replace oil….but it is economics that will drive this (just like cheap oil at $10/barrel which provided no motivation for solar etc. in the past) not some pat on the back being green campaign….it is economics and only economics. So, solar, wind, the green movement have high oil prices to thank, not their silly activism. No matter what people tell a polster, very very very very few people will pay twice the amount for solar power when oil is half price. When the preacher politician gets elected and we all get to use the snake oil to no avail, there will be a lot of “voter remorse”. A false hope is worse than no hope at all.
I think the cook county thing makes it obvious that contract law no longer applies. AJ is perhaps praying for such a development in Miami. It is unlikely to happen in such a conservative state hopefully.
RT, Even if start drilling offshore, we do not have the refinery capacity to refine that oil. Americans won’t see this oil till atleast 10 years, as McCain’s campaign have concluded. What do we do in the mean time if oil remained at a relative high? Also, how long do you think our offshore oil is going to last? We need to invest in oil, solar, geothermal, safe nuclear sources, instead of drilling offshore which is also bad environmentally. Once the infrastructure is there, wind, solar energy can be produced relatively inexpensive, unless of course oil returns to $50 which is unlikely. McCain campaign just like Bush’s does not believe in Global warming which is bigger than anyone thought.
You need to think of how the policies enacted today are going to effect you in the futures, 10 years, 20 years from now. Think of the next generation.
CaboSanLucas – The Sheriff can be held in contempt for not enforcing court orders. The Sheriff can not decide for himself to simply not do this….what a stupid stupid move.
Roger – Also, I do think the electric car tipping point is getting close and it would not be unrealistic to believe that almost all NEW cars will be electric in 10 years as gas cars cost twice as much per mile to operate. It is economics that will drive this, not flower power. In fact, older gas cars could in effect become economically obsolete and even though in perfect mechanical condition, have no value and sent for recycling. I would love to see all electric cars which reduce emissions and also over time will reduce crime via less emissions next to housing with young children…even less noise, etc. Electric cars are the future and we are rapidly getting there…..
Roger – We are already behind on drilling, so what you are saying is we need to get even further behind to the point that is is hopeless??? Silly argument. We will need oil for 100 years regardless of other sources, we will just become less dependent on it is all. We need more U.S. refineries for sure but there are a bunch of regulatory hurdles that are problematic. India is finishing up the world’s largest refinery and will be able to deliver refined products including gasoline to the US for under $2.50 (maybe even less with these lower oil prices) a gallon. That will also ease the volatility price every time there is a hurricane headed toward the US refineries since our supply of refined products will be more diversified.
Wow! Very stupid. A Sheriff is not a judge. Wow! Somebody must want attention….and he will get it and more than he will have wanted. He can be sued personally I would imagine….and the county budget could get hit with thousands of lawsuits. This is the dumbest thing I have heard in a long long time.
———————-
Cook County sheriff to suspend foreclosure evictions
October 8, 2008 at 1:10 PM | Comments (6)
Cook County Sheriff Tom Dart said today his office plans to stop serving eviction notices on people who have fallen behind on mortgage payments as well as renters unaware their buildings have fallen in arrears.
He said his action was necessary in light of the national foreclosure crisis that is driving down the American economy.
Dart acknowledged he could be found in contempt of court for ignoring court orders, but said he was willing to risk that to carry out “justice.”
He noted that hundreds of Cook County residents each month who are evicted after sheriff’s deputies show up at their doors, not knowing that their landlords haven’t made their mortgage payments.
“The people we’re interacting with are, many times, oblivious to the financial straits their landlord might be in,” Dart said. “They are the innocent victims here, and they are the ones all of us must step up and find some way to protect.”
He asked banks to send representatives to rental properties being foreclosed on to notify them of foreclosure proceedings and tell they have 120 days to vacate. Banks now only give such notification to the actual mortgage holders, he said.
According to Dart, foreclosures have risen astronomically over the past year. In 2006, 18,916 mortgage foreclosures were filed in the county, and last year, that number rose to 32,269. This year, Dart is projecting more than 43,000 to be filed.
Dart did say, however, that evictions not related to inability to pay mortgages on time will continue. Such evictions would include renters in apartment building who don’t pay their rent or violate lease agreements.
So far this year, roughly 2,000 people a month have been evicted from their homes, and of that, as many as 500 are evicted because of mortgage foreclosures. Dart said about one-third of those people fall under the category of rent-paying individuals who are unaware that their landlord has fallen into mortgage-related foreclosure.
–Azam Ahmed, Chicago Tribune
Look at this deal 1300 sqft NEO lofts 3/2 foreclosure for 259K. 700$ HOA
http://miami.craigslist.org/mdc/reb/871259418.html
Not familiar with NEO but looking at the ad, they obviously put in decent flooring and cabinets so that’s a plus.
When a realtor advertises a foreclosure such as this, is it often a bogus ad? ie. you call them and the price they listed is a price that is under the bank’s price so it’s more of a short-sale situation.
Renter Tom cited: “as well as renters unaware their buildings have fallen in arrears.”
I wish the Dade sheriff would have had the same policy in place. Screw the deadbeats who are living in the houses facing foreclosure, however, renters are a bit different.
I got served papers as the result of a jackass’ foreclusure. It cost me almost $10K in lost deposit, lost rent, moving, new deposit, and new rent. Won’t bother trying to sue the scumbag – he has lost 4 places (all over $500K) to foreclosure and is probably back in his native country by now.
Un-Related – I feel for you, I really do. How far in advanced did you get the first notice? I had heard about these things happening so researched the condo before leasing….I had the benefit of hearing about this stuff in advance otherwise I probably would have been too trusting. Unfortunately, sometimes there is collusion between the owner and renter and the renters play dumb to the police. Oh well, the sheriff can’t decide to not enforce a court order like that. Let the lawsuits against him and Cook County commence!
This is how screwy times have become. Maybe it should be standard policy for a renter to pull a credit report on the landlord. Considering how a lot of agreements are 1st, last,security deposit, building security deposit that can be quite a chunk of change.
Renter Tom asked: “How far in advanced did you get the first notice?”
I had lived in the place for over two years and had no idea. The effing jerk “owned” some great places and lived like a king. I had no idea it was coming until the Sheriff showed up at door thinking I was “owner”. I was so pissed Iwalked him next door to where the “owner” lives.
I use “owner” in paranthesis because the jerks don’t own anything, not even an ounce of bride or a pound of guts. May the bum roast in hell!
Sorry to hear it Un-Related. I guess he had multiple Home ATM’s that he was cashing in on. We need debtor’s prison or at least a few Guido’s with billy clubs to go collect from these deadbeats.
JL,
I had the same experience with stupid bitch realtors bait and switch tactics. I respond to a great deal on the craigs list advert and Surprise! It is not there but they have other units to show! Grrrr. Such bitches.
All of your comments are great, but nobody is talking about the real important issues like if people are closing or not on their appartment.
How much is maintenance “to start”
Any information as to how many are/not closing? I have been looking for blogs but I can’t find anything relating to closings at the Everglades on the Bay.
[…] posts that I’ve ever written yet it only received 6 comments. Now, I write about a CVS opening at the base of Everglades on the Bay and there’s over 130 comments. I guess, as they say “If you build it, they will […]