Top 5 Miami Distressed Condo Sales Closed in November 2008
December 3, 2008 by Lucas Lechuga
- Vue at Brickell - unit 1413 - 1 bedroom/1 bath (737 square feet) - This unit sold for $90,000, or $122 per square foot, on November 18, 2008. Foreclosure
- Brickell on the River North - unit 2703 - 1 bedroom/1 bath (775 square feet) - This unit sold for $172,750, or $223 per square foot, on November 19, 2008. Foreclosure
- Brickell on the River - unit 3714 - 2 bedroom/2 bath (1,058 square feet) - This unit sold for $255,000, or $241 per square foot, on November 10, 2008. Foreclosure
- Skyline on Brickell - unit 1107 - 2 bedroom/2 bath (1,367 square feet) - This unit sold for $349,000, or $255 per square foot, on November 17, 2008. Foreclosure
- The Club at Brickell Bay - unit 3524 - 3 bedroom/2 bath (1,232 square feet) - This unit sold for $249,000, or $202 per square foot, on November 4, 2008. Foreclosure
Runner-up: Blue Condo - unit 2504 - 2 bedroom/2.5 bath (1,158 square feet) - This unit sold for $305,000, or $263 per square foot, on November 25, 2008. Foreclosure
No bargains here. Show me a new building with a view (not conversion) at $150 per s/f.
Nothing there would cash flow positive with 20% skin in the game.
Click Broker,
Finally people like you are seeing the light.
You call these bargains?! Shit buildings and no views. View?? Club On Brickell???
you said “Show me a new building with a view (not conversion) at $150 per s/f.”
That is not going to happen my friend. I have been saying that for a while and the talking heads on this blog keep predicting that you and the likes can pick a desirable flat in a desirable building with views for pennies on the dollar.
If one wants to pick up a dog house for $150/sf , maybe it will happen. But if you are looking for a decent flat in a good building with at least some views, be prepared to pay $300/sf (down from an all time high of $600) or you can keep waiting.
AJ……. I’m very curious if you think bay view units at Everglades will ever be available at $300/sf. If so, I feel really horrible purchasing a city view unit at about that price point.
Everglades bay facing units will definitely hit $300/sf and probably even lower. Marina Blue has numerous units already at $350-$400/sf asking price and MB is considered by most to be of better quality than Everglades. Let’s not even mention the scandal of Everglades’ developers shortchanging buyers on square footage which will further push prices at Everglades down.
Let’s face it everyone………$150 a sq. ft. is just around the corner.And that will be a luxury suite with VIEW’S.The SMART MONEY is waiting till then and it’s coming FASTER THAT YOU THINK!!!!!
Alan,
Maybe. Maybe not. But do not second guess yourself. You did what you have to at that time and those circumstances.
If bayview units ever hit $300-325/sf in any building, that would be very brief and not long lasting. It also may not be across the board. It will be sporadic and specific to some buildings. IMO that is the absolute bottom for a bayview unit. But you and me very well know that we cannot time that bottom. If we were able to do so we would be gods. Don’t we?
“If bayview units ever hit $300-325/sf in any building, that would be very brief and not long lasting.”
What magic happens at $300 sf? Why that number? Is it the same reasoning that will prevent Google from breaking $400…. Google still is over $400 isn’t it?
JL – AJ is just being a nonsensical pollyanna. All macro econ indicators point down, period. A once in a century over supply combined with lack of financing will continue to drive prices down. Even the NAR says further declines are ahead with no bottom in sight unless the fed govt does something to stabilize prices….well the fed govt can only do so much and is pretty much out of bullets so further declines are ahead. Again, we will know when the bottom comes in when supplies approach 125% of the norm (say 8-9% supply max) which will be close to that pricing. The bottom in pricing will stay for many months and even stagnate at the bottom for years in real dollar terms. There is no rush, there are plenty of “premium” view units, Alan paid too much but that is life and not bad if you have already made the purchase, are living there, don’t plan to move, and it is within your affordability range so as to not be house rich and cash poor. Misery loves company and AJ must be lonely…wonder if he takes requests? How about throwing on some Bruce Springsteen – I’m going down…
http://www.youtube.com/watch?v=ZarmRLa2p9Q
Oh, and more condos are going down down down….one is even gone with The Wind (or at least being foreclosed upon):
Miami’s Wind by Neo condo in foreclosure:
southflorida.bizjournals.com/southflorida/stories/2008/12/01/daily34.html
And Lofts on Clematis (sounds like some sort of disease you’d catch from one of those ladies or if traveling in a 3rd world country) – Lofts on Clematis files for Chapter 11:
southflorida.bizjournals.com/southflorida/stories/2008/12/01/daily33.html
Like from The Matrix “There is no spoon.” well “There is no bottom.” it is all illusion…
RT,
You state…<>
well, there is a govt. proposal to offer 4.5% 30 year mortgages through Fannie and Freddie to qualified new homeowners.
Personally, I believe that is a great plan where the govt. is finally addressing the underlying cause of this entire mess and helping those in need.
I know you are the consummate epitomy of negativity, however, even you must realize that this will provide an excellent opportunity for many to become owners who previously could not afford.
Never in history, could one obtain a 30 year fixed rate at 4.5%.
If this proposal becomes reality, it would be hard to believe that a large part of the inventory would not be absorbed which in turn will stabilize the market.
Now, take a look at your current situation. You love the unit you are renting and this 4.5% mortgage is now available to you. Run the numbers. All of a sudden buying starts looking enticing.
sorry for the ommission in the last post..some reason your quote did not paste.
..you said prices will still decline unless the govt. does something to stabilize prices.
Michael
You fail to include in your analysis that there is probably no way to get those mortgages without 20% down. The days of 100% financing are over and we are getting back to basics (and even overcorrecting as banks just don’t have the money to lend).
So, even if the 4.5% 30 year mortgage is available, a person buying a 2 BR, 1,200 sf condo in Miami at AJ’s suggested “bottom” ($300/sf), would have to come up with $72,000!!!
How many “working class” people do you think can shell out that much coin in this environment?
My guess is that even if they did have it, you have to believe that some are just not willing to commit it when unemployment is growing rapidly and this recession will last a long time.
AJ
Somehow you believe that Economics 101 don’t apply to Miami Condos. Wonder why that is…. At $300/sf and the current rents, none of those buildings even reach break even, but you seem to think that people like to lose money on investments.
the neo wind foreclosure is pretty significant. it’s the first big project to go down. whether others will follow remains to be scene. too bad…it’s not a horrible looking building.
it’s also worth mentioning that the guarantors behind neo are not nearly as wealthy as some of the other high rise players in downtown miami (i.e., leviev and perez) that have new projects coming online.
The Wind is a hardsell with its crazy open no walls floor plans. Most people like defined rooms unless its more authentic loft style. The view will also be gone if building 4 ever gets built on the river.
Michael – The 4.5% mortgages to NEW homeowners (wouldn’t make much of a difference if to all homeowners) is pissing in the wind. It isn’t the creative financing that needs fixing, it is the PRICE. 4.5% will “help” but it is far from a “fix”. It is too little to late and won’t inflate the bubble back. Do you fail to realize what has happened? Their was a credit bubble, not just a housing bubble, that allowed for credit to be extended to people that would never pay back the principal…housing, autos, credit cards….you name it. The principal repayment obligations were allowed to be passed on with a rating that said it was risk free when it wasn’t. The fed govt is throwing home builders a bone to shut them up, it won’t fix things. Those that already qualify will just get a bonus in a lower interest rate and it will only bring in a few marginal buyers into the market….what is the govt going to do, start marketing this as “Buy Now, Offer Expires on 12/31!” then “Interest Rate Sale Extended For Only 10 Days More!”, etc. Meanwhile home prices continue to deflate and buyers continue to wait to buy….. It is going down down down….
Retail sales are now down, down, down…..and commercial retail real estate will begin to get empty empty empty…..
I bet The Wind’s common areas won’t all be open…..perhaps someone can run down to ICAN’T and grab a few pieces of the Alice In Wonderland furniture….
Reducing monthly mortgage payments by one or two hundred a month won’t make much of a difference coming out of a market where credit was extended to people that could even make payments toward the principal….credit was extended already to everyone that needed to buy…..the easy credit created a false demand fueled by speculators too. The willing and able buyer pool is dry.
FYI,
Distressed sale # 4, Skyline unit 1107, has a COMPLETELY UNOBSTRUCTED BAY VIEW. So $255 per sq ft for that unit is a good price. And the unit is not the typical 2/2 that clocks in at 11oo or 120o square feet. It is a more spacious and livable 1367 sq ft. The building is a recent construction (closing in 2005) and is run pretty well. I bought my unit at Skyline during pre-construction in 2002, and I believe that price might be at or below what they were asking for the 07 line at that time. For those of you who enjoy nice amenities, the building has one of the biggest and best gyms I’ve ever seen in a condo, with floor to ceiling glass overlooking the bay. The pool deck is on the water, and it is huge and well maintained. The building has well-priced dock space for those who may own a boat. And lastly, the garage is the most spacious garage I’ve seen in any condo building. All and all, it’s a solid building, and that is a solid waterfront unit.
Condo developers and floplords……throw on the record AJ, all join in now, we can all sing along in The Wind’s common room:
http://www.youtube.com/watch?v=_iDRPJ6TuDs
Michael,
You can get 5% 30 year fixed today from Bank of the West and a few others I’m sure. the extra .5% decline is something like $30 less per month per 100K. That 60 bucks a month is hardly going to help anyone. RT is correct when he says that the lowering of prices is about the only thing that will help. When a nice unit hits $100 per sq ft I’m a buyer as well as many others. Seems like Fall of 09 we’ll start to see it.
#19 – could NOT even make payments on principal.
But probably applies to those that now anyway….
Oh, but the downturn won’t hurt the rich, not…..
http://news.bbc.co.uk/2/hi/programmes/world_news_america/7764066.stm
As cars go so do condos…
Michael,
The new government program seems great at first glance, but what RT says is true. I am a prime example. I’ve got cash, and have access to mortgage at half the going rate (so for 6% rates i can get one at 3%) and i am still unwilling to move. the reason? prices are dropping much faster than the benefit i gain from the lower mortgage rate. mortgage rates are not the issue. its principal that is the issue. new rules in american RE-2B condos are not worth $300k, maybe $200k. AJ is correct for the small number of prime units out there. great views and locations will maintain a nice premium and be reserved for people who can truly afford them. but 90% of the condos are not in this class and are presently being revalued. low interest rates are irrelevent.
Trump University graduates are shaking in their boots. Will rents in Miami fall next?
NYC Apartment Rents Fell in November, Vacancies Rose
If anyone on this blog seriously believes that they can snag a flat in lines 02,04,06,08 and 10 in 50 Biscayne for $325/sf, wake up from your slumber in the fantasy land.
If it ever, EVER goes to that level, there is enough moneyed people in both US and abroad to snap it up in 2 seconds. These flats (at least in the lines I mentioned above) are not made for working class people. A working class couple may not have $7200 leave alone $72,000 for down payment. But there are enough people in this World who can plonk down $360K with out batting an eye for a piece of action in the favourite playground of the World. If these flats ever go down from the current 1/2 million dollars to $360K, they wont be on the shelf for long.
Leave the well to do people aside for a second. For the past 20 years, we (working class people) have been conditioned and grew up in a World where 1 million dollars will not even get you a house worth talking about. $400K will just get you a starter house or flat.
A 2/2 with water views were exclusive domains of the well to do and high fliers. Now due to a once in a century opportunity a working class couple get a chance to live like a CEO for $360K and they will let this pass because they are afraid it might eventually go down to $320K? I think anyone with a little aspiration to live well will take the offer. But unfortunately for the working class couple, before they can put together the financing, the flat will be long snapped up by an all cash buyer.
Hey, fantasize all you want that direct bayviews flats can be had for below $300-325/sf. After all there is no charge for dreaming, yeah.
I just went back and looked at the lines I mentioned above. They are asking an average $525/sf. Can someone kindly post the last few sales in the past couple of months for lines 04,06,08 in 50 Biscayne to put the speculation to rest? Can you also look up any similar sales in lines 03,05,07 and 09 in 1800 club? Thanks
I just want to make one more thing clear. When I said the absolute bottom for the bayview flats in good waterfront buildings to be $300-$325, It does not mean that the prices will settle at those levels. I am only saying that at $325 price point, they become too attractive for anyone and will not last. At $325/sf the premium units are not subject to the recession or financing or other such poor people travails. The point also is that they may never even get to that level.
So please don’t come back in 2010 and spit fire on me saying that ” AJ said the bottom price is $300-325 for a premium unit, I let go a few sale offers at either $350 or $375 /sf and no such deal is coming my way any longer”. You buy when you want and when it becomes attractive for you and affordable for you. If you are not willing to pay a single dime as premium for a premium flat with the fear that it may go down a few more dollars /sf that is your prerogative. You may benefit from being such a hold out or you may not. The fact is to be at peace with your decision and enjoy the flat that you bought. Even though the RE agents have given a bad name to the phrase “once in a life time opportunity”, a sub $350/sf for a premium bayview unit is indeed a once in a lifetime opportunity. It depends on how you look at life whether you agree with me or not.
Let’s revisit this in 6 months shall we aj? For someone earning 26 thousand a year you sure do know a lot about the ultra rich
LMAO. Where did you get the 26k/year! Funny. Anyway I commend you at least for agreeing to wait 6 months to see the results. I am game for it.
At least you are not like that “arse” hole who supposedly has a crystal ball and “knows” everything and talks utter crap all the time.
5/2008 there were 2 sales of 07 line in 1800 club one for 400 k and one for 399k. Hmmm if those sales were to take place after the financial meltdown they would go for significantly less…You paid 400 k and you stand on the precipice….next stop 350 k then 300. You and you partner screwed up vaddi
AJ… I actually like your views, although I believe theye are nonsense. A good blog needs this kind of healthy discussion for it to be valuable.
Now, just 3 things:
1) Do you think that just because people with money (who by the way probably half 30-50% less now than a year ago) are willing to buy a good 2/2 waterview flat just because it’s attractive and it’s now worth less than 6 months ago? People with money generally (not always) are good investors, and this is clearly not a good investment.
2) You make it seem like Miami is the only place for these people to buy a “once in a lifetime” opportunity. First, this is not the only vacation destination and certainly Downtown Miami is far from that. Second, yeah, I guess living in a 500 unit condo next to the one of the busiest sports and concert venues in crappy Miami is one heck of an opportunity. Please
3) I am willing to make a bet if you are…
Hugo,
My views are gathered with an outside perspective, most of my views are shaped and supported by the views of others. It depends on who you talk to.
You and others fail to realize one thing. 90% of this blogs population is not housing bears but wannabe home owners and renters planning to buy. That is the only reason why they are here. They are looking to see how the market is heading and when to strike.
Most of their predictions appear to be wishful thinking more than solid reasoning. It is in their own interest to talk down the market. It has been two years since there is a armageddon predicted on this blog. I yet have to see 50 Biscayne lines 4,6,8 asking less than average $525/sf. So forget about $325/sf, show me when the asking prices hit $400/sf in these lines and I will eat a humble pie. So why don’t you instead of dismissing saying “My views are nonsense” support them with solid proof. At least I support my views with actual numbers.
There are a lot of buyers of ” the world” islands and the burj Dubai that would say an is insane. Dubai is much more the world’s playground than trashy miami . For one I won’t be murdered in the streets in Dubai.
North bay island is filled with much better views and a zero crime rate for 200/ sf and falling!
Who is the president of 50 Biscayne’s condo board? When is their next meeting? 2012?
Yes Hugo, I am willing to bet.
In six months, let us see where the asking prices on lines 4,6,8 in 50 Biscayne.
Right now, it is averaging $525. Maybe you can buy for $450. In 6 months (the absolute peak of the recession and job loss) if the asking price hits $400, you can probably could buy one for $325-$350/sf. That is my absolute bottom prediction (again let me reiterate, it may not even come to that depending on so many other variables. This bottom is assuming every worse prediction to come true regarding economy, job loss, credit freeze etc. But any positive factors along the way such as better and quicker recovery of economy- jobs, earlier thawing of credit, success of the government homeowner bailout program etc will not let this go down to those levels. So we do not know yet).
So if things are different than what you predicted or what I predicted in June 2009, we shall see. Time only will tell.
Dubai Guy,
I have tons of friends living in Dubai and they tell me they want to shoot themselves in the head. If not for the salaries they are getting paid, they don’t want to live in that open air prison. You call Dubai playground? get real, recently a couple got 3 months in jail for coochie cooing on the beach for god sake.
ldk,
North bay village? You are not joking are you? If you are ok with living in NBV, you might be equally happy in Naples or Fort Myers (and for a lot less). Just goes to show that your ideas are completely warped.
AJ,
You may be correct that premium units will never fall to the price others are predicting. Money on the sidelines will always pick those up-regardless of the deal to be had. The big issue people of this country have overlooked is that a $300k mortgage is too expensive for the vast majority of miami and the us population. dont get fooled by the past. people bought properties well above that value, but only because they never intended to live out the mortgage and were assured by the RE establishment they could always resell or refi if money got too tight. those days are over. a $300k mortgage is a major liability in a deflating market with significant unemployment risks. people may well wish they bought the units, but until/if the inflation trigger kicks in, the units are unaffordable for a fiscally responsible person. but as we’ve seen, lots of fiscally irresponsible folks are out there to prove me wrong.
gables,
you are 100% correct. That is a balanced and well thought out piece.
Yes, 300K mortgage is backbreaking for a majority of the populace until and unless a severe recession kicks in.
You are also very right in saying there are a lot of fiscally irresponsible people out there. 99.9% of the popuplation does not read this blog (sorry Lucas, I know that you have the best blog on Miami condos but it is not being read by non RE junkies in a large way). These people do not make an informed decision.
Oops the above line should read “Yes, 300K mortgage is backbreaking for a majority of the populace until and unless a severe inflation (not recession) kicks in.”
can somebody please explain to me what the it means that Wind is going into foreclosure? how does that affect current owners? does it mean the developer owned units are now under new ownership, or does it have an effect on common areas, etc as well? just curious what the actual day to day ramifications of such a situation.
I said a few months back that Wind is the next biggest flop after Opera tower. I did not realize how quickly that came true.
How come there is complete silence about Opera? Does anyone know what is happening to that building as the closings are no more than about 34%? Are the banks foreclosing on Opera or is Tibor managing to keep them at bay by renting all his unsold units? What happened to the talk about a hotel buying 300 units in Opera? Any news. Anyone?
gables
couple of ramifications.
1. the bank is foreclosing on everything that is still covered by its mortgage. haven’t looked at it, but at a minimum, it include all the units which haven’t been sold yet.
2. if the bank goes all the way through with the process, they become the owner of the units. i’m not a condo lawyer, but i have to imagine this will lead to significant association issues, e.g., who is in control of the ass’n, developer liability, etc. my guess is wachovia will make sure they never take possession of the units (maybe have their buyer show up to the actual foreclosure sale and have them bid the agreed upon purchase price).
3. it’s possible you could have a splintered ownership situation, half rental/half condo. suffice to say, that really screws things up. this happened in the 80s with a bunch of buildings in brickell. it was a bloodbath for the banks. as i once posted, the banks were unloading these things for nothing just to avoid the HOA, general unit maintenance and taxes.
generally speaking, this is a really bad thing for those that actually closed. your building now has a scarlet letter. in effect, it’s the vue on a much larger scale. it will take many years for people to recoup their original investment.
Hello readers ,
Does anyone know of an opportunity to purchase bulk condos of distressed, finished or under construction building in Miami? I will appreciate any information or someone on this blog pointing me to the right people. Thank you very much. Please email me at buysellmiami@gmail.com
jcrimes,
A few good buildings have hit a wall after closing 70% of the building. Some hit a wall at 50%. If a building is lucky enough to close 66% (2/3rd) or greater, its survival is more or less assured. The developers can manage to ride this storm by renting or other such means if they hold no more than a third of the flats in a building.
I am eagerly anticipating the next condo closing numbers from Lucas. If my fears are justified, there may not be much improvement in the numbers since the last time he posted those numbers. It is suffice to say that any building with less than 50% closings is in trouble.
This response is for Buy sell Miami, I was reading this blog and saw your post. My family and their partners are in the condo conversion business and have several hundred units available in Florida for both bulk purchase. In Miami we have about15 units left in Palmetto Bay near south motors Bmw and another large block in coconut grove near the may fair hotel. Outside of Miami we have several hundred units inthe Orlando sub market areas and Lakeland,Fl as well.
AJ (#27) “For the past 20 years, we (working class people) have been conditioned and grew up in a World where 1 million dollars will not even get you a house worth talking about. $400K will just get you a starter house or flat.”
The average income in the US is $50k/year; in Florida, about 10% lower. Source: http://www.statehealthfacts.org/profileind.jsp?ind=15&rgn=11&cat=1
I assume that working class people earn less than average. I can assure you that working class people do not and cannot afford $400K for a “starter” house, although some may have been deluded into thinking so by shark lenders in 2004.
AJ (#34) “It has been two years since there is [sic] a [sic] armageddon predicted on this blog. ” What would you call the last two years? Boom times? And that was before the shit hit fan in the stock market and the job market.
This is not a personal attack. I invite you to respond, explaining your position.
AJ
not really. renting the remaining units should cover the debt service however, the reality is that the loan is coming due, not twenty years from now, but in most cases, a few months. banks are under extreme pressue to be transparent about the status of these loans, both with the public as well as the fdic and ots, thus they’re compelled to classify them as in default (if you know that the balloon won’t get paid, then it triggers your defaulted loan reporting requirements). once you’re in default mode, the banks needs to push on the foreclosure front and boot your ass. i’m not saying forebearance and workouts don’t happen. i’ve done several in the past year. however, there needs to be a light at the end of the tunnel in a short timeframe…lenders can’t give developers years. and i can tell you now, for many projects, the simple issue is there is no light, i.e., sales, on the horizon.