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its hot in hell too but do you want to live there year round ??
Is this post intended to spark a discussion about weather? Lucas, has this blog been reduced to benign, weather-related small talk?
Besides, 89 deg is too hot and humid for this time of year, regardless of what’s happening around the US. I don’t feel “spoiled”, I feel cheated. It should be mid 70’s in mid-December.
Drew. Agree with you.
Lucas, keep to the RE. Last few posts have been good. Not as good as the closing rates though… guess you don;t want to spend the time looking athe records anymore! Just a simple MLS report
Well Lucas u gotta admit that they aren’t going to let u forget about your not posting closing rate graphs hehe. C’mon real estate this time of year is generally slow. Give us the closing rate graphs – just for old time sakes. We will all chip in and buy you something nice for Christmas. Wadda u say?
If people here spent half as much time doing their own research as they do bashing Lucas, they’d have the damn info. they keep asking for.
To me, the fact people want Lucas to do it just shows they’re a bunch of r.e. rubber-neckers. If people really wanted/needed this info., they’d be plowing thru the county records on their own.
Kramer,
Actually, this is one of the busiest times of the year for real estate in South Florida. It starts to get really busy here once it starts getting really cold up north. Generally, each year business picks up after Thanksgiving. Last year was an exception because of the economy.
I agree with Joe. I appreciate that Lucas puts up reams of useful info on his site in a very user friendly fashion, but I don’t expect him to be out doing all of the leg work (especially free of charge).
Most of the missing info can be found on the dade county sites anyhow. The county did change to a less user friendly data format awhile back, and I imagine that this is one reason why Lucas no longer deciphers all of the data for posting.
Keep up the good work Lucas. and congrats on that Marina Blue closing.
Bummer – I guess the only people you can bribe these days are city commissioners lol. Btw- That’s a great photo of Miami in the last post.
Lucas
Many of us are up north. NY is bitterly cold & its only Dec 12th. Your weather post is smart . We are jealous for much of the next 3/4 months as it can be physically painful to just walk outside here. Summers: hot & humid, like Miami but in NYC riding subways its not quite the same!
SeanJohn,
Thank you! That was exactly the reason why I wrote the post. I’m originally from Chicago and visit quite often. I receive regular reports about the weather from friends and family up north. I know how painfully cold it has been lately. Yesterday it was around 25 below 0 with the windchill in Chicago. These native Miamians are too spoiled to realize how bitter the cold can be this time of year.
Lucas,
That view looks like the one i wake up to every morning – were you at the miami film festival party at 900 b last night? Miami Downtown Development Authority hosting a party on the 17th – [email protected] for more info. best, shwin
The weather is the only thing Miami has going for it compared to cities up north like NYC and Boston, so we have to make the most of it. Just think, if the NYC lifestyle was warm year round, would you even consider Miami? Decision would not even be close. Just goes to show how miserable winters can be up north! But also shows how far Miami needs to come to be a legitimate city in terms of standard of living, activities, etc. Would be curious to see what the ratio of northerners who move to miami and stay versus those who give up and return north. Not counting retirees and independently wealthy, but working stiffs.
Gables, based on my experience I’d say the % who come down and stay for longer than 2 or 3 years is pretty low. They leave mainly due to the complete lack of white collar professional opportunities and to a lesser extent the culture shock.
If Miami can ever develop some sort of a real economy (not tourism and RE development based) it would become a world class city very quickly. Drive through Houston, Atlanta, or other major cities and look at all of the huge companies from real industries with their vast white collar workforces full of educated highly compensated employees. Then look at Miami, the main occupation here seems to be club promoter, and everyone is “taking classes at MDC” but no one ever seems to get much further than that. As an example of how underdeveloped our economy is, Miami has 2 Fortune 500 headquarters, Minneapolis of all places has 20!
Miami needs to somehow bring in a more educated work force, and try to lure in large employers with tax incentives. If any of these things happen, Miami would really take off (and some of these condos might eventually sell for more than their construction cost)
It hurts me to say this but is true. None of my New York Friends can take Miami for more than a week. It is a cultural thing. People like me are the exception. Most New Yorkers say that they don’t mind shuttling between the two cities but they can never live full time in Miami. I guess there is no substitute for New York to a large majority of New Yorkers. If you guys read about that couple living in 175 sq closet size apt in New York, paying $857/sf and an additional $700/month in maintenance, readers wrote in from across the nation and are wondering why would anyone live like that and for the same amount they can have a mansion in Florida. I guess a lot of people would rather pay the price of admission to the greatest city in the World rather than live in a mansion elsewhere.
But there are 18 million New Yorkers and there are some of us (how ever small a percentage) who are always willing to move to Miami for good. So Miami should always be in demand.
I have to agree too.
I love Miami, but have to shuttle back and forth from LA.
Not enough economy to really stay in Miami full-time.
AJ
I beg your pardon. NYC the greatest city in the World? And exactly what is it about NY that makes it so GREAT? Is it the cold winters and steamy hot summers – the high taxes – the polluted dirty air – the lack of green space – the expensive apartments – the schemers down on Wall Street – the Mafia – the unions – the filthy subways – the porn houses on 8th Av. – the $100. fare from JFK – Macy’s – the dog shit on the sidewalks – the hustlers in Times Square – the Knicks – the Mets – Donald Trump ??? And if you tell me it’s the culture then I will fly in a few times a year for a couple of days and then leave thank you. Maybe you just like saying the word Bloomberg hehe.
Kramer,
It is difficult to explain to someone who does not appreciate it. It is very personal. If you do not like NY atmosphere then so be it. You cannot rationalize it. Usually one either loves NY or hates it.
Yeah Kramer, It is the greatest city in the World exactly for all those things and more.
OK, you tell me which is the greatest city in the World? LA (LMFAO)? Frisco, Seattle, Chicago, Rio, Sydney, London, Bombay, Paris, Hong Kong……?
Yeah, I know. You are as speechless as anyone else who will question the greatness of the most awe inspiring experiment in human kinds history and existence that is New York City. Love it or hate it, there is no substitute, comparison or competition for New York.
Maybe we should just skip telling Kramer what makes NYC so great if you’re all cool with that?
People make their money somewhere else then they move to Miami seeking better weather. There is not a culture in culture that supports hard work or rewards honesty. It is really that simple. Miami will never become a financial because of this.
Mistyped on my cell. Ie. No culture in miami
Not very politically correct, but the post above (#20) is 100% right.
Really, if we want to be honest, the same thing is true for all of Latin America right now.
Re…# 22 Sao Paulo in Brazil for one is a huge & growing global financial center. While Brazil still struggles with poverty, the country, overall, has been booming for years.
Seems like most agree Miami does not hold a candle to other cities such as NYC, outside of weather and play. Not meaning Miami has no perks, but the perks tend to be for those already blessed with money rather than those who work for a living. Miami Skeptic, I agree with you that many people who move south to Miami leave within 5 years. Your thoughts reinforced my suspicions.
If Miami truly had a source of good white collar work, the condos around dowtown Miami would have been sold off by now. Can you imagine how long those would last in the New York area (not even manhattan) at around $350k for a 2B? Would be gone in a blink. I know, as i’ve been considering the move myself. Given all that, the opportunities available when some of these condos fall to $200k will be once in a lifetime for those who do plan on staying long term in Miami. Agree with AJ, many of these units will eventually return to prices outside the range of ordinary folks. But they will become much less liquid than during the boom years-that is the downside to RE outside of a boom market.
will be interesting to see what, if any, the recent confirmation of Legionnaire’s Disease in Epic will have on that particular building, and other downtown buildings in general. my guess is not very good for Epic in the near term.
Gables, I would imagine it will have a devastating effect. Really, I can’t think of any news that could be much worse than, “If you drink the water at Epic, you may die.”
But from what I understand from the article, didn’t it happen a while ago? It is not some fresh occuring or breaking news.
When Noravirus broke out on cruise ships a few (a couple) years ago, people paused for a second. It is all forgotton and long gone. Same with the Taco Bell incident. No one really cares as the time passes. Life goes on.
AJ, the problem with Legionnaire’s Disease is that it has a fatality rate between 5% and 30%-not something to play games with. Norovirus is flulike and upset stomach, but not nearly so dangerous. given some many alternative choices, will be interesting.
Epic… from what I understand they had a water filtration system installed to take out chlorine. This caused a problem that has been going on for a fairly long time. I suspect because the building is sparsely occupied it had standing water that exasperated the problem. Only my speculation.
From a legal point of view the filtration company and the installer will bear a great legal burden. If this were a full fledged condominium and the building didn’t do proper maintenance the building would be bankrupt overnight. Insurance will step in, but the deductible is so high it begins a death spiral.
Many buildings will turn the water heater down below what the recommended temperature to save some money. I expect this to be a huge warning to the city inspectors in the future.
http://www.osha.gov/dts/osta/otm/otm_iii/otm_iii_7.html
COMMON SOURCES OF CONTAMINATED WATER.
1. Water sources that frequently provide optimal conditions for growth of the organisms include:
* cooling towers, evaporative condensers, and fluid coolers that use evaporation to reject heat. These include many industrial processes that use water to remove excess heat;
* domestic hot-water systems with water heaters that operate below 60°C (140°F) and deliver water to taps below 50°C (122°F);
* humidifiers and decorative fountains that create a water spray and use water at temperatures favorable to growth;
* spas and whirlpools;
* dental water lines, which are frequently maintained at temperature above 20°C (68°F) and sometimes as warm as 37°C (98.6°F) for patient comfort; and
* other sources including stagnant water in fire sprinkler systems and warm water for eye washes and safety showers.
gables (post #24) — Most of the condos downtown *already* are out of reach of “ordinary folks,” or else they would have been long gone by now.
Remember, a $50,000 price drop sounds great, but the condo fees not only *aren’t* dropping but most likely will be increasing at most of these buildings in the very near future.
This will sound elitist — I don’t mean it to be — but the truth of the matter is this: HOA fees are a luxury for most people, and luxury condos aren’t meant for teachers or bus drivers who might be able to afford a unit at the rock-bottom prices.
I don’t care what AJ or anyone else says; this is the reality: There were far too many high-end condo buildings built in Miami vis-a-vis Miami’s job base, and most of these downtown buildings are doomed to mediocrity, declining amenities, and/or futures as glorified rental buildings. Unless thousands of wealthy people suddenly move into Miami, there simply aren’t enough jobs to support people paying their mortgage *plus* $300 to $1,000 (or more!) per month in HOA fees. There just aren’t.
If those jobs and incomes existed, those condos would have been full 1-2 years ago. Who wants to commute 30-60 minutes each way every day when they could live in a brand-new oceanfront building 2 minutes from work? The jobs/incomes just don’t exist in the Miami market. It’s as simple as that.
Transit drivers are not a good example. With overtime they can retire with $100,000 a year. ‘Miami transit OT draining county budget’ dates back to 2006. They can easily afford one of these buildings. In fact most local government workers will be occupying these buildings. The none government workers will have to live in Overtown.
So a condo south of fifth just sent around notices about an “emergency petition for appointment of receiver” . Sounds like too many owners not paying their dues each month.
and I read on another forum, but not sure if this is true or not about a different building…
“At Bentley Bay, the HOA has pushed passed $1M in delinquencies. The HOA dues are now above $1.25/sq ft.”
southbeachsand: which condo in SoFi going into receivership?
Miami corporations will not relocate to Miami because of the uneducated work force. Ivy League CEO’s would never consider the city because of this. On top of this you have a new immigrant population that struggles to speak as well as the taxi drivers in NYC. Then you have the culture of coruption imported from Latin america. Many of the wealthy owners at Bristol, Santa Maria, Four Seasons amassed their fortunes by never paying taxes in their home country because of no tax enforcement. They come here not understanding the concept of needing to pay taxes, so they don’t.
The out of town money has been hit hard, they wil not bebuying condos again, unless it is more Latinos laundering money so they don’t have tipsy taxes back home
I don’t understand why “southbeachsand” didn’t name the condo, but that’s really interesting about a SoFi condo possibly heading into receivership. The theory on this board all year has been that prices aren’t falling in SoFi because well-heeled owner-investors could ride out the r.e. storm, but this news would put the lie to that, at least in one building.
How many condos are there in SoFi? I can think of Apogee, Continuum North (II), Continuum South (I), Murano Grande, Murano at Portofino, Portofino Tower, South Pointe Tower, Yacht Club at Portofino, … others?
Another item. The IRS is looking very hard at laundered deals from abroad (particuarly from Latin america) going back many years on condos purchased at higher end buildings. As a result (post 911) a large amount of non taxed Latin money has been eliminated permanently from the landscape. No investor from Latin america is going to himself by having his assets invested in a condo seized. Talk to any high end attorney who deals and advises on this subject. The word on the street is the money is going to Canada, costa rica and panama – because of these concerns. This is something most Americans don’t get, how important this is……influencing the market to not recover as people may think.
Bad typing. ” no Latin American investor is going to expose himself……..”As above
big problem down here is the “entitlement” mentality of the wealthy. I know there is a backlash on this board from some against the poor who demand government provide them whatever means necessary to survive. but the rich down here are a unique brand as well, due to their foreign born experiences. many do not believe they should pay taxes, insurance, HOA, etc here in the States, because they do not pay in their home country (latin america, russia, italy are prime examples). this is why capitalism breaks down in south florida so quickly-the trust component is eroded immediately. capitalism and business become very inefficient in such environments.
gables, please do not generalize!
In Europe, in most countries people pay taxes, insurance, HOA fees etc as you have to in the USA. E.g. , in Italy you have to pay property taxes for your second home!
But the HOA fees are quite lowe because there are only scarce amenities in the condo buildings (mostly no pools) and receptions or doormen are not common (except in ultra luxury premises). As a little example: In Europe we do not know valet services.
You might be right regarding Eastern Europe and Latin America.
I think a lot of people are really missing the point when comparing Miami to NY. I currently work and spend most of my time in the NE (DC, NY, Boston) but I grew up in the Midwest. I completely understand why someone would bear the freezing winters up here just to live in NY, but comparing these two cities just doesn’t seem to make sense.
When looking at population Miami ranks 43rd in America. Some cities that are considerably larger than Miami are Detroit, Columbus, Louisville, El Paso, Kansas City, etc. And quite frankly most people would rather live in NY than all these cities.
So I think its odd that people are comparing Miami to NY, Chicago, Boston (3 of the largest cities in America) while skipping over the other 40 cities that are larger than Miami as if this somehow shows why Miami sucks. If anything this show how much people actually love the city.
If the NYC lifestyle was warm year round would you consider Detroit or Columbus? Most people wouldn’t. But given what is actually reality, to most people it sucks up north in the winter so countless people will choose Miami over Columbus (which is almost twice the size of Miami) in a heartbeat.
So even though Miami ranks in the 40’s in size, the climate and amenities move Miami into the ranks of the top 5-10 cities. I don’t see how that’s a negative for Miami.
I agree however that Miami is lacking a sizable professional workforce. I attribute this to the fact that it is smaller than most people think, lack of prominent schools in the south, an economy that is based on tourism and high cost of living. Sure places like Minneapolis have a large number of company headquarters located there. But it’s for a reason, the cost of living is low. You can pay your upper management employees less and they can still live in 5000 sq ft homes. But go visit. I assure you that anyone who enjoys NY or Miami will not be able to live there for long.
Gixxer – Miami is the 7th largest metro area in the country, with about triple the population of Columbus/Louisville etc. This is why we generally discuss it vs the other major metros.
Actual city population is fairly meaningless, just depends where the legal city limits are. This is why Jacksonville is technically the most populous city in Florida, most of the metro area falls within the actual city limits. Anyone who has spent a minute in both JAX and MIA knows that Miami is a much much larger city.
Gixxer-
Your “population” argument (as a measurement of one city being “better” than another) doesn’t make much sense.
While it may be true that the City of Miami proper ranks 40+/- in population, you must realize that the City of Miami’s geographic boundary is very small, and your argument is flawed if you make comparisons off of that misleading population figure. When people speak of, refer to, or associate with “MIAMI” they typically are talking about South Florida in general (Miami-Dade & Broward), or in the very least, the City of Miami, Miami Beach and the surrounding municipalities (Hialeah, Coral Gables, Pinecrest, Doral, Kendall, etc.)
Note that “South Florida” for US census purposes, ranks 6th nationally for population. The census figures comprise regional assessments, not just municipality populations that give you skewed and misleading #’s (like only looking at City of Miami population).
It is not odd that Miami isn’t compared to other cities that may have a greater population; Miami is compared to cities (NY, LA, Vegas) that it actually has things in common with – art, music, entertainment, tourism- regardless of population. Population is a non-issue, so there’s no reason to compare to El Paso or Kansas City.
Gixxer,
The posts on population are correct. The Miami metro area is one of the largest in the nation. That is why it compares to NYC, Boston, etc. New York is not made up of just Manhattan either-the surroundings are immense. Columbus and Miami are not even remotely comparable.
Visionary (#39),
My generalization is well founded in experience. Not talking ordinary folks, but the wealthy. And they do not pay their taxes in many countries. Italy is offering amnesty (again) to repatriate money into the country. The wealthy have the ways and means to avoid payment. In Miami, I know several foreign wealthy condo owners who are not paying HOA-their response is sue me if you can. The fees and taxes exist everywhere, but the enforcement leaves alot to be desired around the world.
Latest news about the Epic from SFBJ:
Epic Hotel closed, Legionnaire’s suspected
The Epic Hotel in downtown Miami has been shut down following reports of tourists getting sick from the hotel’s water system.
I don’t know if using a metro area really works when your trying to compare specific cities. If you consider the Miami Metro area your talking about as far north as Jupiter and as far south as Homestead, that over 120 mile span. However Columbus is about 100 miles from Cincinnati and they are not consider one metro area because there is not a lot of commuting between the two areas. Heck, Dayton is only 40 min away and it’s not considered the same metro area. Metro areas have to do with people commuting not living. Metro areas and statistical areas are computed for a lot of arbitrary reasons. Do you really consider Palm Beach County a part of Miami? Since there is absolutely nothing else close to Miami within about another 300 miles their metro area spans out farther. Other than NY South Florida is the longer than any other urbanized area.
Most would choose Manhattan over Miami but what about Southold (on Long Island) and Ft Lauderdale. Me personally I would take Ft Lauderdale. And I bet most people would. Or what about Hackensack, NJ. I have friends in these areas that go to Manhattan only a couple of times a year. But they just live there because they were born there. Trust me if family wasn’t an issue these people would rather live in Miami and visit Manhattan a few times a year rather than live in Southold and visit Manhattan a few times a year.
But regardless my original point still stands. Even when considering the entire metro area, Miami should be considered similar to Detroit, Dallas, Houston, Dallas, Philly, Boston, etc. Not NY, not LA and not Chicago. These areas are double to quadruple the size of the Miami metro area. But I never hear anyone comparing Detroit or Dallas to NY. But yet Miami does get compared. Obviously the draw of Miami elevates it above similar size cities (or metro areas).
Drew helps prove this point. He throws Vegas in with NY and LA. Even considering the metro area, Las Vegas is 1/5 the size of the LA metro area and 1/10 the size of the NY metro area. But the allure of Vegas elevates its status just like the allure of Miami does.
South florida has a unique geography-everglades to the west and ocean to the east. Thus by default it is a very long and thin metro area. But people work in downtown Miami, and live as far south as homestead and north of Ft Lauderdale. It is one large but continuous area (not ready to consider palm beach a part of miami, however). Typically people consider Miami-Ft Lauderdale as one unit, and this combination makes for a quite large metro area.
In addition to size, one must compare common economical engines with each city. Miami is a tourist city, so it must be compared to other tourist cities to make sense. Industrial towns cannot compare to Miami-you need a work ethic 🙂 LA, Chicago and NY have alot of tourist components-particularly foreign visitors. Thus the comparison. Detroit does not have this component so it is not comparable. New Orleans has tourism, but the metro area is far too small to be comparable. Orlando has tourism, but who actually considers the home of a mouse to be a real city?
Gables you do have to pay tax in Europe Latin america, the problem is if you arrange to get paid outside of the us you are not taxed on income. Talk to any tax lawyer on this subject. 99 percent of the deals done by foreign nationals are in order not to pay any tax back home. So when they pay full price it is a discount. Those days are over you are going to see a lot of siezed condos by the treasury department on this subject. This is why Russians Latins are not buying, they don’t want to get caught up in reporting requirements -and having their condo siezed. This money will not return to the us ever, that money that propped up prices is gone. Biggest exposure are titles held in the name of a trust by a foreign national- non American
NEWS FLASH: Epic Hotel shuttered, Legionnaire’s suspected
http://southflorida.bizjournals.com/southflorida/stories/2009/12/14/daily3.html
Unbelievable!
scriv
Again I think my point is being missed. NY, LA and Chicago in and of themselves are not tourist attractions. The attraction is the people themselves. Art, Music, Entertainment is all a byproduct of the massive amounts of people. There is more culture, arts, shows, etc in NY because there are so many more people there. They have a larger group of consumers.
Add another 15 million more people to the Miami metro area and I’m sure you would have all the tourism, music, arts, etc as NY. There is nothing in any of these cities that cannot be built in Miami but you cant move a beach with tropical climate to any of them.
But regardless my point is in regards to the actual amenities of Miami in comparison to similar cities in regards to your comment:
“But also shows how far Miami needs to come to be a legitimate city in terms of standard of living, activities, etc.”
How is Miami’s standard of living or activities lower than any other city with similar resources (i.e. population).
It seems like you are trying to compare a Ferrari and a Corvette by saying that they are both sport cars. I guess if you walked up to most people on the street they would say the Ferrari is better. I’m just pointing out that they are not really in the same class considering the Ferrari cost $175k and the Corvette cost $65k. The mere fact that they are being compared speaks volumes for the Corvette.
Gixxer 1000:
Add another 15 million more people to the Miami metro area? No thanks. Those that are here are causing enough chaos, mayhem and general ruckus. They don’t need help. (Smile)
scriv
Gixxer (#49) “How is Miami’s standard of living or activities lower than any other city with similar resources (i.e. population). ?
The question indicates you have never lived in Miami, and very well may have never visited. Having lived in cities throughout the eastern half of the US, I have a bit of experience. The standard of living in miami is very poor unless you bring money from elsewhere (or work for the city of Miami-the number of $100k+ jobs is amazing!) It has its perks, dont get me wrong, but the miami quality of life is quite low compared to many other urban centers. something we accept and deal with down here-alternative is to move. but i really enjoy shorts and flip flops in January far too much to do that 🙂
gables hit right on.
A metro area is defined as a contiguous built up or an urban agglomeration area that is interdependent on each other or commute with each other. Or a group of interacting municipalities.
In that sense Cincinnati – Columbus- Dayton is not a metro area.
Long Island- New York- New Jersey – Westchester – Connecticut is.
So is Miami – Fort Lauderdale – Palm Beach
or LA – Orange County – Ventura – Inland Empire.
“…the problem is if you arrange to get paid outside of the us you are not taxed on income. Talk to any tax lawyer on this subject. – – Uneducated Workforce
Not true, my friend – – talk to any tax lawyer. They will advise you otherwise. If they don’t it’s because: 1. it’s happy hour and they have had 3 too many; 2. they are an accountant who, by law, cannot give such legal advice; 3. they don’t know their international tax (e.g.: International tax + in and out-bound transactions + treaties are the principle courses at the U of M’s graduate tax program.)
Under U.S. tax laws, the worldwide income of any U.S. citizen or resident alien is subject to tax. It doesn’t matter if you’re living in the United States or overseas, or the money came to you as wages, independent contractor payments or unearned income from investments, pensions, rents or royalties. Generally speaking, there are inclusions, exclusions and you have to factor in other issues such as those specified in SubChapter F and, of course, tax treaties and the tax shelter provisions (e.g. “listed transactions” reporting requirements) But, ain’t this a bit technical? Oh well, you opened this can of worms.
scriv
scriv, My mom sent me $2066 as a christmas gift from abroad (wire transferred to my bank account). Do I have to declare it as a 2009 income in my upcoming tax return filings?
Oh, just to clarify, my mom is neither a US citizen nor a permanent resident. I am.
scrivener ,
You don’t talk to a US Lawyer about Foreign Nationals tax problems back home. Your incorrect. There is no world wide tax regarding foreign nationals taxation. Yes there is for US citizens, but I am talking about foreign nationals (NOT US Citizens), who for the most part are not paying and/or reporting large transactions on real estate back in their home. Follow?
this is why they will resist buying real estate here because of reporting requirements to the US, which then in turn report back to their home country. They do not like this new change, and they don’t like the scrutiney their tax free investments are getting outside of their country. There are MANY foreign nationals who have bought large amounts of condos in many high end buildings, just so they don’t have to report income back home. That is all changing now…………..
Many condos titles are being investigated in the high end buildings, Santa Maria, Four Seasons, Epic, Bristol, and they are looking closely at the title. You are going to see many condos siezed in the near future, there are many foreign nationals that have avoided paying taxes by laundering their money through real estate deals in the United States. US Tax Attorneys know this……..this is another source of liquid money that is no longer available. Those investors are being coached to invest (post 911) outside of this country in Canada, Panama, Mexico and Costa Rica.
AJ – You STILL take money from your MOTHER? Wow. Odd. I would think at your age it would be the reverse and give gifts to your mom. I couldn’t even imagine having my parents giving me thousands of dollars. By the way, if your mom was a U.S. citizen then she can gift you $13,000 in 2009 without having to pay gift taxes (note, gift taxes are paid by the giver, not the receiver).
gables — Of all the problems in Miami, “the rich” are the least of them. How is it bad for Miami if some rich guy comes in and buys a condo with cash? It might be bad for the guy’s home country, which didn’t get the tax income, but how is it bad *for Miami*? As for “the rich” not paying HOA or insurance, what would be the point of that? Every HOA on the planet can slap a lien on the underlying property, so where’s the damage? (Obviously, if the unit owner is underwater on the unit and not paying HOA, then that’s bad, but that wasn’t the scenario you laid out.)
——
Uneducated Workforce — Do you have any links for this alleged IRS crackdown you’re talking about? If a foreign individual was so worried about the IRS, then why wouldn’t he/she simply create an LLC, which can be held anonymously? I don’t buy this idea that the IRS is driving rich foreign nationals to take their money out of the U.S. More likely, market forces are causing any such transactions. Why buy a bunch of condos in a saturated market with carrying costs that are thru the roof? I can think of a thousand better places to launder money right now than in Miami r.e.
——
By the way, still no word on the SoFi condo with the possible receivership? I hate it when people post teasers like that. It’s not exactly the nuclear launch codes.
RT, My mother is well off and if she wants to give me money for a gift, I will take it. It is not like I am asking for it.
I had some idea regarding receiving gifts from US citizen parents up to 13K in a calender year (I used to think it was only 10K). But I guess the same applies to a foriegn parent too. I will check with a tax pro.
I agree with the Uneducated. US citizens have to report all their income from every corner of the World. But citizens of other countries when they live in the US or outside their countries, do not have to pay taxes on the income earned outside their home countries.
“You are going to see many condos seized in the near future, there are many foreign nationals that have avoided paying taxes by laundering their money through real estate deals in the United States.” – – – Uneducated Workplace
OUTSTANDING! BRING IT ON! I love a good scandal – – don’t you?
Nothing makes me want to pop popcorn and grab a cold beer like a good financial fraud.
scriv
ps: if you find any current articles on this topic (e.g. “Investor nabbed”) PLEASE SHARE!
For example, in case you missed it/have not read it:
http://www.miamiherald.com/460/story/1382147.html
Let the games….BEGIN!
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Taxpayers may be hit in finance woes
With the Securities and Exchange Commission investigating Miami’s budgeting practices once again, experts say `this is a very big issue’ for the city.
BY MICHAEL SALLAH AND CHARLES RABIN
[email protected]
Miami taxpayers could bear the brunt of severe penalties if federal investigators find that city leaders misrepresented the city’s financial problems when they sought millions for public projects, say legal experts.
Because the city has been under federal order for years to reveal budget woes to bondholders, Miami could face a range of sanctions from paying major fines to bearing the cost of hundreds of thousands in investigative costs. For a city already on the financial brink, that could trigger delayed projects and diminished services.
“This is extraordinary,” said William Nortman, a former associate regional administrator of the U.S. Securities and Exchange Commission for Florida. “Where are the controls? The second road is not going to be smoother.”
Just six years after the SEC found the city was unlawfully shifting money between accounts to conceal a $68 million shortfall, the agency is again probing Miami for questionable money transfers to prop up the budget, according to a letter obtained last week by The Miami Herald.
The newer transfers, totaling $26.4 million, came in 2007 and 2008 to once again balance the books, The Herald reported this summer.
City leaders, who are being forced to turn over a host of their e-mails and internal communications to the SEC, say the movements of money over the past two years have been legitimate. “It wasn’t done under the table,” said Budget Director Michael Boudreaux, who is being asked to turn over his e-mails.
A RARE CASE
However, the emergence of an SEC investigation while the city is already under an existing federal order to stop violating federal securities laws is rare, say former SEC administrators and securities lawyers.
“This is a very big issue,” said Andrew Stoltmann, an adjunct professor of law at Northwestern University and Chicago securities attorney. “It’s so rare to see a follow-up investigation of this kind because the sanctions can be so extraordinarily serious.”
The SEC inquiry marks the most significant scrutiny of Miami’s finances since a meltdown a decade ago led the state to wrest control of the city’s checkbooks.
Stoltmann said that with all the financial fraud cases exploding across the country, the SEC would not have launched a probe — requesting reams of specific files from six top city administrators — without finding new evidence.
“You don’t start an investigation of this magnitude unless you have a road map, even a whistle-blower. It just doesn’t happen.”
The agency’s notice of an investigation, sent to City Hall Dec. 10, came less than a month after a scathing report by City Auditor Victor Igwe, who said the city fudged financial integrity rules by engaging in “inaccurate and misleading” practices to fill the budget gap.
The SEC says it does not comment on investigations, but the three-page letter obtained by The Herald shows the agency is targeting two key transfers that helped balance the books as Miami’s deficit was growing.
Boudreaux had identified two “unspent” pots of capital-fund money — one for $13.1 million in 2007, another for $13.3 million the following year — that he placed back in the city’s general fund to reduce the 2008 shortfall.
What the SEC wants to know is whether the money was used in what regulators call a “shell game” — moving funds around to simply make it appear the city’s books are balanced.
Boudreaux said the money was from either completed or killed projects, and that he was able to transfer it back to the general fund.
But he has not been able to identify which specific projects the money was going to.
“It’s been like a nightmare trying to close the loop. We didn’t know what these holding accounts were for,” Boudreaux said.
Nortman, now a securities lawyer in Fort Lauderdale, said he expects the SEC will employ investigators to conduct forensic work, but the fact that money sat in accounts with no earmarks “is just astounding.
“Where are the controls? Are these mystery assets? You have to have a system in place to ascertain where money is supposed to be spent and where it originated. That’s a problem.”
He said it could take months or longer for the SEC to complete its investigation. If it finds that the city violated the SEC’s 2003 order, the law allows an array of measures, including monetary fines — the amounts open to discretion — or even lawsuits against individual city leaders. “You have the authority in these cases to press for claims against them,” he said.
SETTLEMENT
The SEC can also demand a settlement that calls for the city to be guided by an oversight board or other entity to ensure that it is following the law.
Stephen Halpert, a University of Miami law professor, said fining the city would only hurt the taxpayers. “There’s a question whether they should be bearing the brunt of this.”
That may also depend on whether the city’s bond rating is impacted by the investigation or the SEC’s findings. “It may be a matter of investors seeking damages from the city,” he said.
Just the existence of an SEC investigation could impact Miami’s ability to issue bonds, leading to potentially lower ratings on Wall Street and higher costs to a city thatstruggled to recently close a $118 million budget gap.
Miami attorney Tom Tew, who represented the city in the last SEC inquiry, met again with leaders Monday to “walk them through the issues” and aid officials in turning over volumes of records to the SEC.
Tew noted that no conclusions have been made, and said Miami hopes to go to the bond market in the not-to-distant future.
“Time is of the essence for a city — it’s a living, breathing thing,” Tew said.
Miami Herald staff writer Larry Lebowitz contributed to this report.
scriv
scrivener — I’ll believe this big “condos seized” story when I see it. Since when does the IRS seize property held by people who dodged taxes in Mexico or Colombia or Venezuela? The IRS can’t even keep up with *U.S.* tax cheats.
Joe:
Answer: it doesn’t.
It is just a matter of time…….In 2004 everyone said that real estate would always go up in Florida because everyone one was moving here. Remember that? Information supplied is “ahead of the curve”…..and the reason why the heavy weight foreign nationals have not returned. An uneducated workplace, culture of corruption are just parts of the total puzzle, and the real reason why real estate will not return to these historic highs for perhaps a decade, easily 5-7 years of stagnant real estate growth and prices.
Look at Penthouse prices. At one time they were a “hot” investment to own. They are no longer hot, because the high carrying charges and taxes equate to an immediate loss of capital on holding an investment with no true market and return. This is the case with 10 Museum Place. if you see how long he has to keep this large condo with massive carrying charges of $12,000 a month carrying charges, there are not many takers.
kramer you sound like half a moron you watched to many old death wish movies with charles bronson
most people are not in nyc in the summers, and the winters are not that cold
but thats we we flock down there, it takes 3 hours, almost like driving on 95
my co-op is bigger than my mia condo condos are condos……
theres also something known as jobs, which many people seem to think are a plus……….
what we dont have as much of is half naked latinas with thongs out, high heels and implants
which is another reason to hit miami in the winter…….also nypd is not out of control
Uneducated Workplace:
I agree with you. The “Florida real estate is a great investment” mantra was a tremendous scam that I rank up there with “cigarettes don’t cause cancer.” Let’s look at it rationally.
Real estate, particularly condos, are depreciating, not appreciating, assets. Much like cars, their value drops the moment you leave the dealer’s lot. Condos do not pay dividends – – in cash, stock or otherwise. They don’t pay interest like bonds. Rather they require an initial investment and continual maintaining cash outlays (taxes, HOA fess, etc.)
Let’s call a spade a “spade”: real estate developments are a hole in the ground or a building where someone throws money. The “investment” label was a complete scam.
Unfortunately, during the bubble/boom/whatever – – people were effectively treating and marketing them like they were stocks or bonds. And, unfortunately, a lot of truly unsophisticated people bought into these “investment” mantra (hook, line and sinker) and got taken.
And now a lot of these unsophisticated folks are complaining about not receiving an acceptable “return” on their “investment”? Give me a break. Boo hoo. “Sympathy” is a word in the dictionary.
Do the math. If you run the supply and demand curves (I note: this is where having a drawing application on this board would be REALLY USEFUL) the real estate market is on the far right side of the curve – – having gone beyond it’s max and well into the diminishing returns area. It is going to be years, at best, before the value of these “investments” reach anything akin to what they were fetching during the height of the housing boom. And that’s an optimistic bet because, as the free market evaluates the quality of the individual developments – – the free market may never let the values of the majority of these “investments” return to their over-inflated values.
scriv