1800 Club and Neo Vertika Now FHA Approved
April 7, 2010 by Lucas Lechuga
This news came across my desk yesterday afternoon and I was quite surprised. I verified the information on the U.S. Department of Housing and Urban Development (HUD) website. It appears that Neo Vertika received its FHA approval on February 2, 2010 and 1800 Club received theirs on March 18, 2010. Down payment requirements for qualified buyers on an FHA loan can be as low as 3.5 percent of the purchase price. FHA loans typically come with additional costs but credit standards are usually less stringent than those of a conventional loan.
Thanks for the post Lucas!
Lucas, what is the difference between fannie mae approved and FHA approved? which is better?
At $24/sf Miami office rents are stronger than Seattle, Chicago, Houston and Philly! How is that possible? wasn’t Miami supposed to be a useless place to do buisness as per many on this blog?
http://online.wsj.com/article/SB126291211587420679.html?mod=yahoo_free
slater,
Miami is nothing more than world-class financial center, one of this planet’s top tourism spots, arts, education and healthcare juggernaut and playground for the rich and famous.
How could it possibly compare to Philly? (sarcasm).
good news, just got a call from my friend. the owner of the 1800 club unit backed off from his demand to raise the rent. he agreed to keep the rent at last years level of $1350. So my friend is extremely happy. I guess the land lord decided that a $100 increase is not worth the hassle of losing a good tenant.
Slater, the landlord also new the chances of getting a new tenant at $1600 a month was probably low, and each month without a tenant will cost him $100 a month over a year long lease. my experience over the past couple of years in Miami is the landlords will act tough, but you can call their bluff because you own all the cards. your friend could have probably gotten another $50-$100 off the next year long lease if he wanted to take some risk. but my bet is he would not get a lease renewal after that year out of spite, if the market recovers by then.
Please vote for Miami on the list so Google can spread fiber optics all over our city.
Google is picking 10 American cities for the project. That means cheap and higher speed Internet for everyone who lives in Miami. Spread the word to everyone you know, so they can vote too. Vote now!
http://curiouscapitalist.blogs.time.com/2010/04/07/quick-sign-a-new-lease-rents-are-poised-to-rise/
http://www.reuters.com/article/idUSTRE63543U20100406
I am surprised we are doing loans with 3.5% down. Without a good chunk of change invested, people will be more willing to walk away if they come across hard times or the market drops a little bit putting them underwater.
I know 20% is a large amount of money to come up with for a lot of people, but requiring 20% would go a long way towards getting more stable owners in the market.
Lucas, you have two of your three links to articles discussing the same research report from a company who has an interest in real estate turmoil and uncertainty. The other link simply states SFH may have bottomed, but indicates condos have room to drop in South Florida. The story titles seem to imply something different, am i missing something?
gables,
How does Reis have “an interest in real estate turmoil and uncertainty.” Someone says rents in Miami are raising by only 1.6% and its some kind of conspiracy.
I agree about the other article. “It’s bottoming, maybe, possibly, but we don’t know what will happen after the tax credit, but it looks good, but we don’t know, maybe later this year.”
Gixxer, not saying conspiracy. But Reis business model is based on real estate. Just as Moody’s and S&P reported and rated on bonds for cash (you do understand what happend there i hope), Reis reports and rates on real estate investments. The past couple of years should indicate a serious possibility of conflict of interest. That cannot be overlooked. Just pointing it out.
gables,
You sure are one funny guy. Are you telling my you can’t tell the difference between data and the analysis of that data?
Reis provides quarterly reports for inventory, vacancy rates, rental prices, etc. for commercial real estate and also provides trends and analysis of that data. Anyone can take data an manipulate it to fit what they want to say, like most people here. The 1.6% rental rate increase is the data. Now you can argue that’s bad and means the market is headed lower and I can argue that’s good and means the market is stabilizing, but arguing that they specifically manipulated the information to get 1.6% is a conspiracy. Was there a problem with Reis last quarter when they were indicating that rent prices were decreasing?
Reis has no monetary gain one from reporting Miami rental price increases. There is no conflict of interest here.
The people at Moody’s and S&P stood to personally benefit from handing out Aaa ratings like candy.
Gixxer, you place the words conspiracy in my mouth. I did not say that. But you had better learn to assess the quality of the information you use to make decisions based on where the info comes from. Not saying Reis numbers are wrong, but I would not make monetary decisions just based on their report-dont be naive. Moody’s and S&P were paid by a business interests to rate bonds for future sales. Reis is paid by business interests to rate real estate for future sales. very few firms are truly “independent” and “impartial” in todays business world.
for example, Reis calculates a 1.6% increase based on the numbers they use. how accurate are those numbers? my current lease has dropped each year over the past three years, yet that number is reported nowhere in the data. am i a unique case? so now answer the question, how accurate are the numbers used in the report? they are precise, but i do question the accuracy (and suspect the 1.6% is probably well within the scatter of the data). all i’m doing is drawing caution to the point-no conspiracy at all.
Yes I’m placing conspiracy in your mouth because what your suggesting is a conspiracy. They provide information for 79 markets and not all of them are up. What incentive do they have to say that rental rates went up 1.6% in Miami if they didn’t?
“Reis is paid by business interests to rate real estate for future sales. very few firms are truly “independent” and “impartial” in todays business world.”
Reis is not paid to RATE real estate for future sales. They compile market information and then sell their quarterly reports based on that information. They get paid regardless of what they report. Out of the 79 markets they follow, 30 of them were down. This month Miami just happens to be one of the ones that was up. This is nothing different than Condo Vultures who simply compiles public record information into one report and sells it for $39.95 or Condo Reports. com that does the same thing.
“my current lease has dropped each year over the past three years, yet that number is reported nowhere in the data.”
This just shows you don’t know what your talking about. This is about APARTMENT vacancy and rental rates. Apartments keep detailed records of vacancy and rental rates. I seriously doubt this information is wrong. And even if it is it doesn’t mean much. The point of the information is that vacancies are down and rents are no longer going down. Reis is not claiming Miami rents are sky rocketing. The only people doing that is in the headlines of the people reporting the story because it gets peoples attention. As usual most people can’t tell the difference between the data reported in the article and the opinions of people quoted in it to sell the article.
You could make the argument that this doesn’t apply to downtown considering 90% of the rentals are condos and not apartments, but you don’t take enough time to actually look at the information to realize that.
This is just like Joe who complained about employment data being wrong because he though it was self reported information when its actually data from employers payroll. You guys have no clue what you’re talking about.
Go to calculated risk and all the other places and everyone used Reis’ numbers when they were showing that vacancy rates were high and rents were down. And then all of a sudden now when the numbers go up for the first time in years these guys are being paid to report it that way. Give me a break.
I don’t blindly accept that these numbers are correct, but if you are going to argue they are wrong why not argue MLS numbers are wrong. You have no problem assuming Lucas’ information is right but this information is suspect. This information is just as verifiable.
If the report said that rents are still down and vacancies were rising you would have never brought this up.
Here is a link to Miami apartment market trend statistics from apartmentratings.com. Funny enough based on a sample over 2800 renters and 421 apratments the numbers look eerily close to Reis’ in depth report numbers with the average rent being just over $1000.
http://www.apartmentratings.com/rate/FL-Miami-Pricing.html
And if you recall I posted before from DIFFERENT sources that the national apartment vacancy rate was 8% and that Miami was below that at about 6.5% and poised for rental rate increases. I believe at the time that info was from a NAR/CBRE report.
From most of the comments posted by people I can tell you that I check the validity of reported data more than most people here. I look at the sources and methodology of the information regardless of whether is supports my view or not.
gixxer #15, very accurate.
gables, again goes to show that you thinkthe whole world is notjust brickell but the whole world is just you. If your landlord gave you rent break every year, maybe because of a million reasons including that he might have liked your face. what isthat got anything to do with reis numbers. saying that your rent dropped and it did not reflect in reis data is so laughable and so delusional. If you can actually set market numbers, then you are god. dont feel so important.
But otherwise, i like your bearish attitude. If one landlord reads your post and offers me a rent concession, that should help me ingetting a place for cheap. in reality, the situation is so drastically different , i am not able to secure a cheap enough rent for a decent place in downtown.
gables,
you are quickly catching up with carlos in terms of cuteness. Twins separated at birth, maybe?
Anyway, it’s so sweet that you think that the data is inaccurate because the agregators forgot to include you in it.
BTW, how do you know that they didn’t include your alleged rent decline into their results? Checked every name?
slater
aside from the fact that the article makes no distinction between different types of spaces, avg. asking price doesn’t tell the story. class a space defines a city from a white collar space. ask any office leasing agent down here what his take on the rental market is for class a…they certainly won’t say things are optimistic for the foreseeable future. the fact is, when GT moves to met 3, there is no similar class a tenant to replace it in its current digs. same follows for bilzin and its move out of wachovia. and stanford’s former space at 201 s. biscayne is still on the market (minus some sublets). this town simply doesn’t generate white collar jobs in a large enough amount to cover all the class a space coming online or already online. you can expect in the next few years for class a space to take a beating down here, probably larger on a pct. basis when compared to similar class a space in chicago or seattle.
f-35…i can only imagine that when you said “sarcasm” that was to be applied to your comments about miami being a world class financial center and educational juggernaut.
Re. Enzo #7, that googlefiber site is not legit, and not affiliated with Google. It’s some sort of scam to generate ad revenue. Please don’t bother voting there.
F-35, i know my rent was not included because it was not reported to the mls board. my landlord is a realtor and just bypassed that info for a variety of reasons (commissions, etc). but i must be a special case because i am sure no other realtors own rental property in miami.
slater, i actually watched the rentals in my building drop over the past three years. it was just a trend. Three years ago you could get $1800+ for a 1B, and in the past year they have been as low as $1250.
gixxer, again no conspiracy. 5 years ago everybody believed in Moody’s, including Buffet. your arguement today would very much sum up Moody’s position 5 years ago. But my how things change. And i dont consider the Moody’s and S&P situation a conspiracy. But there were underlying conflicts of interest that did not reveal themselves until well after the fact. Can you guarantee a similar situation wont play out with Reis 5 years from now? But i waste too much time on you over a 1.6% change in data which is nothing more than scatter.
so Gix, tell me, if 90% of downtown Miami area is condo rentals, and not then included in the reports that strictly detail stats from professional apartment complexes (such as Reis), what good are they for the Miami market? And in seriousness, are the condos being rented by developers in the Miami area included in these “apartment” reports? makes a big difference in the validity of reports we see on the miami condo market.
jcrimes,
no, the word “sarcasm” is applied to any dimwit who chooses to bulid his own house, when brand new condos are selling just a short distance away below the cost of construction. Then the dimwit complains that “construction is killing him”.
But maybe sarcasm is not applicable here. Incredulity is more like it.
f-35
you are part of the reason i moved to this city – so much easier to get ahead when folks such as yourself are still straining to find a way to remove their head from their ass.
regardless, you’re welcome to sing all the praises of the condo buildings that went up over the past few years. i’ll take my house in miami beach over your crap condo even with all the headaches that a renovation brings. sorry, but trying to compare the two is beyond doltish.
moreover, whenever you want to qualify your miami is a world class financial center and education juggernaut statement, feel free to do so. i didn’t mean to offend you and your prized two year degree from miami dade or your teller job at a distinguished institution such as transatlantic bank sweetheart.
jcrimes,
thanks for a bit of a comic relief.
I’m glad you’ll take your delapidated shack which obviously is in a dire need of back-breaking “renovation” (read complete rebuilding) over my beautiful 40th floor condo (which I bought at give-away price), but I guess some people never allow common sense to stand in the way of their own financial immolation – and who am I to object?
I hope that for you the ability to watch online porn with full sound and worship your own wilted banana tree outweighs all of the hussles of termite abatement, hands-on maintenance, sucky security, sky-high insurance rates and car exhaust that passes for air in your dungeon. For me it doesn’t. Not even to mention the fact that the only way for you to ever enjoy my breathtaking view is very briefly after your propane tank accidentally blows up.
In the end it’s all about priorities, so I can only wish you the best of luck in your moronic endeavor.
Maybe you’ll even tell us about all of the nasty surprises and miscalculations that you encountered while erecting your bunker. Don’t hold back. That’d be a lot of fun to read.
the name calling is actually quite boring.
Come now, Gables, I think the F-35/jcrimes exchange (“crap condo” v. “wilted banana tree”) is great; it’s certainly a lot more fun reading – as I’m sure you’ll agree – than some of the super dull statistical (and less than compelling) reports about the local real estate market we’ve been served up recently.
Cue Gixxer to provide a tedious 5000-word statistical analysis of F-35/jcrimes witty insults re SFH v. Condo.
As an aside, I find it remarkable that so many people on this blog happen to live in majestic 40th+ floor penthouse units on Miami Beach/Brickell. Lucas you’ve successfully targeted this market: Internet-addicted, independently wealthy penthouse-living jackasses. Congrats.
Miami heading for bunkruptcy
Yeah, I’m really enjoying the exchange myself.
“financial immolation “? I have to admit looking up that one.
pardon the interruption, carry on now!
“Re. Enzo #7, that googlefiber site is not legit, and not affiliated with Google. It’s some sort of scam to generate ad revenue. Please don’t bother voting there.”
Am I the only one on this blog not surprised that Enzo would be duped by something so obvious? Definitely not the sharpest knife in the drawer! Some people should have their Internet privilege revoked.
Gixxer 1000 — Does your employer know you spend 2-3 hours per day posting on this site (and who knows how much time on other sites)?
You’ll fit right into the Miami workforce.
Joe,
Yes, my employer also knows that I’m leaving to attend grad school this fall. Honestly I wouldn’t mind being laid off and getting a severance package for the next couple of months but its cheaper to keep me around to handle odds and ends.
You go through a lot of spurts when your on here a lot as well.
Pot, meet kettle.
Once again the focus of your discussion is on me and not my actual arguments.
The funny thing is that I have a lot of downtime at work so instead of wasting it on facebook I use it to get a better understanding of the Miami market (and others) in case I decide to attend UM. But you spend so much time here for what……….
People getting excited that some REITs are catching bid in the backdrop of unprecedented bond buying by FED (a criminal act of daylight robbery ) however moving toxic asset from buyer A to govt doesnot really address the main problem..The fed will be forced to sell MBS soon as subprimification of US debt would ratchet up treasury rates and as soon as that happens, you will witness the negative loop in work again..as FED is forced to get rid of toxic asset to manage govt debt (or citis/states/counties will face even bleaker picture)// once FED start dumping MBSs, and banks start liquidiating RE portfolio in earnest, bottom would remain elusive…
Once liquidation is over by next 1-2 yrs, construction industry will be rejuvenated and economy will begin to really grow…Now tell that to Obama……
Worldwide asset bubble is yet to burst. But it is around the corner…
Gixxer 1000 — “Pot, kettle” my rear end. I visit this site no more than once per day and spend no more than 5 minutes per visit. You, on the other hand, seem to hit “refresh” every 30 seconds to see if anyone has had the audacity to challenge anything you’ve said.
I come here because I still intend to buy a condo in Miami if/when the time is right. I certainly don’t come here and pretend to be an all-knowing expert on a city in which I’ve spent about 15 minutes, unlike, ahem, some people around here.
I saw a unit at gallery art. simply beautiful and the views are amazing even though the building is on the biscayne blvd. very nice and chic.
Dear Joe,
This is not a question. It is a quote. “All good things come for those who wait!”
What Do You Think — I believe that quote is *still* 100% right when it comes to the Miami r.e. market. I have no idea if downtown has bottomed or not, but a 5-second glance at Miami Beach’s sales numbers tells me that market/area has a *long* way to go before the bottom is hit. There are buildings on the Beach that haven’t had a sale in 90 days or more, including buildings that have 25-50% of their units for sale.
(Any feedback, Renter Tom? It seemed like you were following the Beach fairly closely.)
since we have some number crunchers on this board, wondered what your thoughts are on a particular scenario. Assume housing prices stay basically stagnate over the next 7 years (don’t argue this point it is just a scenario). Interest rates rise to around 6.75% for a 30 year mortgage (again just a scenario). I am a cash buyer. My scenario assumes one is not going to make money off appreciation of the property in the next 7 to 10 years. If I buy a 2B unit around 1100 sq ft, does anybody have a maximum purchase price for the unit assuming it can be rented for $1800 and $2500? I assume HOA at around $800 a month and property taxes around 2.5%. Can I make a reasonable ROI with real estate without appreciation compared to dropping the money in some fixed return of 5.5% (again just a scenario)? This is my realistic bear scenario over the next decade. Have a bullish scenario as well, however.
I am very surprised why no one talks about Gallery Art or City 24 on this blog. I saw them yesterday and both buildings and the units are simply outstanding. Even Lucas has not featured them in his Arts District lineup of buildings. Is there anything I should know?
gables,
Your #39, what about inflation ?
visionary, since i really don’t know what will be the going rate for inflation, its left out for the time being. low inflation is implied with little asset appreciation, along with a mortgage rate which is historically below average. if we do get inflation and appreciation, then the numbers from the scenario should be conservative as an investor. but my guess is when inflation does kick in (i think it will), it will probably be in a few more years, thus minimizing its impact on a 7 year investment view.
Slater, I also would like to hear about art gallery and City 24. I think the prices are too high. for these buldings since they are not on the water. am I correct?
lara, these are 2 blocks from water. the unit i saw in gallery art was on 14 floor (low) and north facing. but the views were incredible. I could not believe it.
The bathroom finishes were top class. It looks as good or better than Everglades bathrooms and Everglades has a big name recognition.
regadrding the prices, i dont know as i am not here to buy but to rent. I will give 2 thumbs up for gallery art. I love the building and also the people who are living there. It is ultra modern and very contemporary. Also I can walk to my work in midtown and also walk to Pace park (3 blocks). I hope i can get to live there.
those condos get very little press probably due to location and size? i assume they are not large nor centrally located? please enlighten us on the neighborhood.
by the way, you say you have trouble finding affordable housing? what size unit are you looking for and at what prices?
gables, location is top notch. 2 blocks from water and all major stores, restaurants and conveniences on the doorstep.Size wise,they are not 500 unit monsters but they are not small either, with each having 200+ units. that is definitely not small. neighborhood is nice if not excellent. I personally love it. Just go to midtown on a weekend and it is busier than Lincoln rd at the sugarcane and mercadito. the biscayne blvd construction is annoying but it should pass in a few months and it is all for good. safe, safe and safe. in fact so many cops cars everywhere and all the time, it is annoying. I had to drive in my best behavior. street thugs stand no chance at all if they ever dare to venture to midtown and edgewater. i walk to starbucks on 30th and midtown and the new mexican restaurant across from starbucks that seems to be rocking all the time. Come, take a look at gallery art. you will love it. if anyone is planning to buy, do it now before the biscayne reconstruction is over and the neighborhood looks really snazzy.
my budget was $1250 for a 1bed in a brand new building. willing to up it to $1300. still looking. had to find something by july 1st.
slater, you should be able to get something of interest for $1300. Anything below that can be had, but you must be at the right place at the right time. have you made any offers? if you are looking for july 1, you may find landlords to be reluctant to hold a place empty so your offers may not be taken too seriously. but my guess is anybody advertising for $1500 will probably take $1350 for a year long lease. make sure you negotiate the rate down-its part of the culture here in Miami 🙂
gables, thanks for the tip. july 1st is only my deadline. i can move in much before that.
yes made an offer in quantum for $1275 for a unit asking $1350 and got rejected!!
slater, from the listings and past action in quantum i would imagine $1300 could be had. if one place rejects an offer, check on another. arguing over $50 a month and thus losing one month rent is really not good business practice-but again remember many of these folks are amateur landlords. good luck but i imagine you will get what you want-you are in the right ballpark with expectations.
Here is something interesting I noticed this weekend. A sign just went up at Marquis advertising developer units starting at 375k. This is for their smallest 1400 sq ft obe bedroom unit. With that bieng said prices at 900 are hovering around 400k for a 1000 sq ft one bedroom. It will be interesting to see what happens to prices at 900 since the fit and finish at Marquis appear to be of superior quality.
In addition, Miami, where the median price reduction was $33,000, had the largest price reduction percentage of 14.16 percent.
http://www.dsnews.com/articles/home-price-reductions-surge-in-hard-hit-markets-2010-04-09