MIAMI -- Foreign tourists who for years have crowded Florida’s shopping malls to buy clothes and electronics, are now flocking to real estate offices to snatch up apartments and homes at bargain-basement prices.
The investors, mainly from Europe and Latin America, are jostling over apartments in Miami’s trendy South Beach neighborhood selling for $70,000-$100,000, and in less exclusive areas to the north where they start at around $50,000.
“The buying opportunities are maybe the best ever. Who knows if we’ll see prices again like today’s in Miami Beach,” Keys Real Estate agent Michelle Iglesias told AFP.
Property prices in Miami have fallen by almost half (47%) since the real estate bubble peaked in 2006, according to Standard & Poor’s Case-Shiller 20-City Home Price index.
Analysts predict that real estate market prices will not increase until the banks get rid of all their foreclosed properties and there are more jobs in the region.
“Unemployment is still high. People are afraid of losing their homes and credit is hard to get,” said Standard & Poor’s vice-president Maureen Maitland.
In and around Miami, banks each month repossess about 5,000 properties, including apartments and commercial real estate, for delinquent mortgage payments, according to real estate brokerage CondoVultures Realty, which has 250,000 such properties on its books across southern Florida.
But foreign investors have kept prices from plunging even further, the Miami Association of Realtors said in its November report. “The international buyers continue to fuel market strengthening, we continue to observe positive signs,” said association president Oliver Ruiz.
Beatriz Lamanda from Venezuela bought two apartments north of Miami Beach for a reduced price of $80,000.
“I’d rather put my money in real estate than leave it in the bank. In a few years I’ll make a nice bundle because the prices are going to go up, no question,” she told AFP.
In the “Icon,” a three-building apartment complex by French designer Philippe Starck in Brickell, Miami’s newest financial district, apartments are selling for $250,000, down from $370,000 two years ago.
“We’ve sold 350 units in the last few months. Most of the buyers are international,” Fortune International’s Alejandra Castillo told AFP. -- AFP
Wednesday, December 15, 2010
Brickell Avenue Speed Limit to be Cut - December 15, 2010
The Florida Department of Transportation now says it will lower the speed limit and make engineering changes to Brickell Avenue, after complaints that the road was dangerous for walkers and cyclists.
BY ANDRES VIGLUCCI
aviglucci@MiamiHerald.com
Bowing to persistent pressure from Brickell residents, bicycle and pedestrian activists, and city and county officials, state roadway engineers have agreed to reduce speeds along busy Brickell Avenue, as well as add crosswalks and "share-the-road" markings to improve safety.
The changes will be incorporated into a year-long,$9 million resurfacing of the 1.6-mile state road that is slated to begin in January, Gus Pego, district secretary for the Florida Department of Transportation, said Tuesday.
Pego stressed that the agency agreed to the bike- and pedestrian-friendly measures after new engineering studies conducted in the past few weeks found them to be justified.
"We've been responsive to the issues brought to us," Pego told The Miami Herald.
The alterations to the resurfacing project mark a significant concession by FDOT. Agency engineers had until recently insisted they could make few of the changes demanded by residents, activists and local officials.
Critics argued that a shortage of crosswalks forced people to jaywalk and complained speeding cars imperil the growing number of pedestrians and joggers along the avenue, the spine of Miami's densest district -- a rapidly changing area that residents and city planners envision as a walkable, bikeable urban neighborhood.
The dynamic began to shift for several reasons. Last month, a 30-year Brickell Bay Club resident, Rosa Encalada, 83, was struck and killed by a taxi as she tried to cross the avenue on a Sunday evening.
FDOT engineers, meanwhile, took a verbal beating from angry residents and activists at a public meeting last week and in blog posts by TransitMiami.com and the South Florida Bicycle Coalition.
And public officials -- including Miami Mayor Tomás Regalado, Commission Chairman Marc Sarnoff and Miami-Dade Commissioner Carlos Gimenez -- intervened forcefully with Pego.
Tuesday evening, Encalada's family held a candlelight vigil at the spot near 2300 Brickell where she was struck.
"That's wonderful news," Teresa Encalada, the woman's daughter-in-law, said of Pego's decision. "That's what we wanted."
In return for FDOT's concessions, Sarnoff said, the city will immediately step up traffic enforcement along Brickell, including at a flashing-light pedestrian crosswalk recently installed by the state agency along the residential south half of the avenue.
Sarnoff said too many motorists have been ignoring the yield-to-pedestrians signal, as he found out when he drove the avenue every day for the past two weeks to gauge conditions.
"I watched a few old ladies try to cross from the west side to the east side, and motorists were just gunning it to beat them," Sarnoff said.
The issues brought up by residents, bike activists and leaders of the Brickell Homeowners Association included a neighborhood-incompatible speed limit of 40 mph along the residential stretch of Brickell, a shortage of marked crosswalks and a lack of signage or pavement markings indicating that motorists should share the right lane with bicycles.
FDOT has agreed to:
• Reduce the speed limit to 35 mph along the residential stretch between Southeast 15th Road and the entrance to the Rickenbacker Causeway.
That will make the entirety of Brickell 35 mph -- the same speed as the connected Biscayne Boulevard to its north. Though that's higher than the 25 to 30 mph some Brickell residents wanted, Sarnoff said it marks "a step in the right direction."
"Thirty-five is a manageable speed," he said.
• Add a new marked crosswalk in the 1400 block of Brickell, in the business district. Also, some crosswalks that now exist along one side of an intersection but not the other will be completed so that pedestrians will have marked crossings on all four corners.
• Southbound and northbound right lanes will be slightly widened and marked with "sharrows" -- chevron-shaped stripes and an outline of a bike on the pavement to indicate that motorists must share those lanes with cyclists. The road isn't wide enough to accommodate separate bike lanes.
During construction, Pego said, all speeds along Brickell will be reduced to 30 mph.
Read more: http://www.miamiherald.com/2010/12/14/1973912/brickell-avenue-speed-limit-to.html#ixzz18DY6ytGE
BY ANDRES VIGLUCCI
aviglucci@MiamiHerald.com
Bowing to persistent pressure from Brickell residents, bicycle and pedestrian activists, and city and county officials, state roadway engineers have agreed to reduce speeds along busy Brickell Avenue, as well as add crosswalks and "share-the-road" markings to improve safety.
The changes will be incorporated into a year-long,$9 million resurfacing of the 1.6-mile state road that is slated to begin in January, Gus Pego, district secretary for the Florida Department of Transportation, said Tuesday.
Pego stressed that the agency agreed to the bike- and pedestrian-friendly measures after new engineering studies conducted in the past few weeks found them to be justified.
"We've been responsive to the issues brought to us," Pego told The Miami Herald.
The alterations to the resurfacing project mark a significant concession by FDOT. Agency engineers had until recently insisted they could make few of the changes demanded by residents, activists and local officials.
Critics argued that a shortage of crosswalks forced people to jaywalk and complained speeding cars imperil the growing number of pedestrians and joggers along the avenue, the spine of Miami's densest district -- a rapidly changing area that residents and city planners envision as a walkable, bikeable urban neighborhood.
The dynamic began to shift for several reasons. Last month, a 30-year Brickell Bay Club resident, Rosa Encalada, 83, was struck and killed by a taxi as she tried to cross the avenue on a Sunday evening.
FDOT engineers, meanwhile, took a verbal beating from angry residents and activists at a public meeting last week and in blog posts by TransitMiami.com and the South Florida Bicycle Coalition.
And public officials -- including Miami Mayor Tomás Regalado, Commission Chairman Marc Sarnoff and Miami-Dade Commissioner Carlos Gimenez -- intervened forcefully with Pego.
Tuesday evening, Encalada's family held a candlelight vigil at the spot near 2300 Brickell where she was struck.
"That's wonderful news," Teresa Encalada, the woman's daughter-in-law, said of Pego's decision. "That's what we wanted."
In return for FDOT's concessions, Sarnoff said, the city will immediately step up traffic enforcement along Brickell, including at a flashing-light pedestrian crosswalk recently installed by the state agency along the residential south half of the avenue.
Sarnoff said too many motorists have been ignoring the yield-to-pedestrians signal, as he found out when he drove the avenue every day for the past two weeks to gauge conditions.
"I watched a few old ladies try to cross from the west side to the east side, and motorists were just gunning it to beat them," Sarnoff said.
The issues brought up by residents, bike activists and leaders of the Brickell Homeowners Association included a neighborhood-incompatible speed limit of 40 mph along the residential stretch of Brickell, a shortage of marked crosswalks and a lack of signage or pavement markings indicating that motorists should share the right lane with bicycles.
FDOT has agreed to:
• Reduce the speed limit to 35 mph along the residential stretch between Southeast 15th Road and the entrance to the Rickenbacker Causeway.
That will make the entirety of Brickell 35 mph -- the same speed as the connected Biscayne Boulevard to its north. Though that's higher than the 25 to 30 mph some Brickell residents wanted, Sarnoff said it marks "a step in the right direction."
"Thirty-five is a manageable speed," he said.
• Add a new marked crosswalk in the 1400 block of Brickell, in the business district. Also, some crosswalks that now exist along one side of an intersection but not the other will be completed so that pedestrians will have marked crossings on all four corners.
• Southbound and northbound right lanes will be slightly widened and marked with "sharrows" -- chevron-shaped stripes and an outline of a bike on the pavement to indicate that motorists must share those lanes with cyclists. The road isn't wide enough to accommodate separate bike lanes.
During construction, Pego said, all speeds along Brickell will be reduced to 30 mph.
Read more: http://www.miamiherald.com/2010/12/14/1973912/brickell-avenue-speed-limit-to.html#ixzz18DY6ytGE
Wednesday, December 8, 2010
High-End Movie Theater in the Works for Downtown Miami - December 8, 2010
The latest attraction coming to downtown Miami: a 12-screen movie theater.
BY HANNAH SAMPSON
hsampson@MiamiHerald.com
In a move that signals confidence in Miami's economic recovery -- and potential for growth in the city's urban core -- the developer of the downtown Metropolitan Miami complex announced plans to add a high-end movie theater.
Plans call for the new theater at the Metropolitan Miami complex to open by late 2012 or early 2013. It will join a Whole Foods, set for completion in 2013, and the already-open Met 1 residential tower, Wells Fargo Center office tower and JW Marriott Marquis and Hotel Beaux Arts.
Adding a multiplex is the latest step in making the area a place where people want to live, work and play. That's a dramatic change of scenery from 10 years ago, when fewer than 40,000 people lived downtown and there was a dearth of options compared to other cities with cosmopolitan credentials.
But the building boom added towering high-rise buildings with 23,000 units -- and the bust made those units more affordable for young professionals who wanted to live near their jobs. Now, 70,000 people live downtown, and the Miami Downtown Development Authority expects another 10,000 to move in by 2014.
The theater, said DDA executive director Alyce Robertson, was a missing piece for those new residents.
"This is an amenity that adds to the ambience of a 24-7 residential, commercial and entertainment district," Robertson said.
MDM Development Group said Tuesday that it had finalized an agreement with luxury theater company Silverspot to open a 55,000-square-foot, 12-screen theater as the anchor for the planned Met Square entertainment complex. It will also include retail and restaurant space.
"This is a total game-changer for the market," said Lyle Stern, principal with Koniver Stern Group, the retail leasing representative of Metropolitan Miami. "It's real urban living."
The downtown Miami corridor has added thousands of residents and dozens of restaurants, shops and hotels over the past decade. But the broader downtown area hasn't had a movie theater since the AMC at Omni International Mall closed in 1999 -- and even that was more than a mile north of the proposed site near Biscayne Boulevard and Southeast Third Avenue.
For a night out at the movies, downtown residents have to drive to South Beach, Coconut Grove or South Miami.
Those are attorney Eric Bluestein's options -- though he finds himself watching movies at home more often than venturing out to a theater these days.
"I like movies a lot," said Bluestein, 28, who lives in the Met 1 building. "Once they put a theater next to me, I'll definitely be going quite a bit."
Miami City Commissioner Marc Sarnoff, who chairs the DDA, said downtown offers sports with the AmericanAirlines Arena and arts with the Adrienne Arsht Center for the Performing Arts, but lacks what he called the "simple pleasures" of going to the movies.
"It makes it a whole community," he said. "There's no reason you have to leave."
The closest movie option, Paragon Grove 13, reopened in June after going dark for renovations for eight months at Coconut Grove's CocoWalk. Like the planned theater, that cinema sells wine and beer and allows patrons to reserve specific seats.
Silverspot, which has one other location, in Naples, boasts luxuries like large leather seats, hardwood floors and marble and glass finishes. Though pricing for Miami isn't yet available, general admission for adults at the Naples location is $15.
MDM did not disclose projected development costs for the theater at the $1 billion Metropolitan Miami complex.
James Marsh, a media and entertainment analyst for Piper Jaffray, said chains worldwide have been experimenting with offering high-end moviegoing experiences. He said the concept hasn't yet been proven, but it could be a smarter move than trying to compete with nearby megaplexes.
Movies in general have fared "remarkably well" during the economic recession, Marsh said, despite the abundance of entertainment options on home television screens and mobile devices.
For Bluestein, who also works downtown, the promise of having a grocery store and movie theater in his back yard is "like a dream come true."
"It'll definitely make life a lot easier," he said. "Anytime you can avoid traffic down here, it lessens your stress."
His prediction: "I'm going to become a downtown hermit."
Read more: http://www.miamiherald.com/2010/12/07/1962662/high-end-movie-theater-in-the.html#ixzz17X4dUfy7
Our comment: Whoo-hoo!
BY HANNAH SAMPSON
hsampson@MiamiHerald.com
In a move that signals confidence in Miami's economic recovery -- and potential for growth in the city's urban core -- the developer of the downtown Metropolitan Miami complex announced plans to add a high-end movie theater.
Plans call for the new theater at the Metropolitan Miami complex to open by late 2012 or early 2013. It will join a Whole Foods, set for completion in 2013, and the already-open Met 1 residential tower, Wells Fargo Center office tower and JW Marriott Marquis and Hotel Beaux Arts.
Adding a multiplex is the latest step in making the area a place where people want to live, work and play. That's a dramatic change of scenery from 10 years ago, when fewer than 40,000 people lived downtown and there was a dearth of options compared to other cities with cosmopolitan credentials.
But the building boom added towering high-rise buildings with 23,000 units -- and the bust made those units more affordable for young professionals who wanted to live near their jobs. Now, 70,000 people live downtown, and the Miami Downtown Development Authority expects another 10,000 to move in by 2014.
The theater, said DDA executive director Alyce Robertson, was a missing piece for those new residents.
"This is an amenity that adds to the ambience of a 24-7 residential, commercial and entertainment district," Robertson said.
MDM Development Group said Tuesday that it had finalized an agreement with luxury theater company Silverspot to open a 55,000-square-foot, 12-screen theater as the anchor for the planned Met Square entertainment complex. It will also include retail and restaurant space.
"This is a total game-changer for the market," said Lyle Stern, principal with Koniver Stern Group, the retail leasing representative of Metropolitan Miami. "It's real urban living."
The downtown Miami corridor has added thousands of residents and dozens of restaurants, shops and hotels over the past decade. But the broader downtown area hasn't had a movie theater since the AMC at Omni International Mall closed in 1999 -- and even that was more than a mile north of the proposed site near Biscayne Boulevard and Southeast Third Avenue.
For a night out at the movies, downtown residents have to drive to South Beach, Coconut Grove or South Miami.
Those are attorney Eric Bluestein's options -- though he finds himself watching movies at home more often than venturing out to a theater these days.
"I like movies a lot," said Bluestein, 28, who lives in the Met 1 building. "Once they put a theater next to me, I'll definitely be going quite a bit."
Miami City Commissioner Marc Sarnoff, who chairs the DDA, said downtown offers sports with the AmericanAirlines Arena and arts with the Adrienne Arsht Center for the Performing Arts, but lacks what he called the "simple pleasures" of going to the movies.
"It makes it a whole community," he said. "There's no reason you have to leave."
The closest movie option, Paragon Grove 13, reopened in June after going dark for renovations for eight months at Coconut Grove's CocoWalk. Like the planned theater, that cinema sells wine and beer and allows patrons to reserve specific seats.
Silverspot, which has one other location, in Naples, boasts luxuries like large leather seats, hardwood floors and marble and glass finishes. Though pricing for Miami isn't yet available, general admission for adults at the Naples location is $15.
MDM did not disclose projected development costs for the theater at the $1 billion Metropolitan Miami complex.
James Marsh, a media and entertainment analyst for Piper Jaffray, said chains worldwide have been experimenting with offering high-end moviegoing experiences. He said the concept hasn't yet been proven, but it could be a smarter move than trying to compete with nearby megaplexes.
Movies in general have fared "remarkably well" during the economic recession, Marsh said, despite the abundance of entertainment options on home television screens and mobile devices.
For Bluestein, who also works downtown, the promise of having a grocery store and movie theater in his back yard is "like a dream come true."
"It'll definitely make life a lot easier," he said. "Anytime you can avoid traffic down here, it lessens your stress."
His prediction: "I'm going to become a downtown hermit."
Read more: http://www.miamiherald.com/2010/12/07/1962662/high-end-movie-theater-in-the.html#ixzz17X4dUfy7
Our comment: Whoo-hoo!
Tuesday, December 7, 2010
Foreclosed Home Mistakenly Sold to Two Different Buyers - December 7, 2010
David Stern's beleaguered law firm's foreclosure mistake led two people to buy same house in Cutler Bay.
BY DIANE C. LADE AND DOREEN HEMLOCK
Sun Sentinel
Real estate investor Marjorie Oster was pleased when she snagged what looked like a good deal through a Miami-Dade County foreclosure court auction: a four-bedroom house in Cutler Bay, with a swimming pool, for about $95,000.
But when her husband drove by the next day to check on the property, he saw "someone cleaning the pool, a lawn service cutting the grass and a note it was being tented for termites," said Oster, a Miami resident who has been in real estate for 15 years.
It turns out the house she thought she had purchased had been sold in a short sale the week before to someone else -- Osberto Jimenez, a 40-year-old truck driver. The law firm handling the foreclosure for the lender mishandled the paperwork and never canceled the auction sale.
"So we both own the same house and I'm frustrated as hell," Oster said. "Someone screwed up."
New attorneys representing CitiMortgage say that "someone" was David Stern's beleaguered law office, which originally represented the lender. Citi ultimately pulled the case from Stern's offices and gave it to Shapiro and Fishman, another large South Florida foreclosure firm that represents banks and loan servicers.
Both law offices, along with two others, are under investigation by the Florida Attorney General. They're accused of engaging in shoddy practices, including fabricating documents. Shapiro and Fishman has defended its practices and said it did nothing wrong. Jeffrey Tew, the attorney representing Stern, declined to comment.
Stern, who at one point claimed he processed 20 percent of the state's foreclosures through a staff of more than 1,000, has been forced to lay off the vast majority of his employees as his biggest clients continue to abandon him. Citi spokesman Mark Rodgers declined to comment specifically on the Cutler Bay double sale, but said the company stopped referring new foreclosures to Stern in September and now has removed all of its business from the firm.
Attorneys general in 50 states continue to investigate reports of servicers and foreclosure firms like Stern's "robo-signing" hundreds of thousands of affidavits without reviewing them.
In the situation with the Cutler Bay house, attorney Leora B. Freire, with Shapiro and Fishman, said Stern's office didn't notify the courts to take the house out of the foreclosure auction after the short sale had been processed.
Oster and Citi reached an agreement last week, Freire said, vacating Oster's sale, which allows Jimenez to keep the house. Oster said she would be refunded her money, paid some interest, and have her legal fees covered.
Documents show Oster bought the property for cash on Oct. 6 and received a certificate of title. Seven days earlier, Jimenez executed a warranty deed and took out a $123,000 mortgage in a short sale approved by CitiMortgage and the previous owners.
The tsunami of negative news about Stern's operation had Oster fearing she never would see her money again. She said she contacted the office numerous times for more than a month, but attorneys either would not return her calls or couldn't tell her what had happened to her payment.
"I just wanted out because it was David Stern's firm," she said.
Mortgage giants Fannie Mae and Freddie Mac, who comprised the majority of Stern's referrals, pulled all of their cases from the firm over the past two months. Shapiro and Fishman, however, remain on Fannie's referral list.
Darryl Wilson, a professor and real estate expert at Stetson University's College of Law, said that while selling the same house twice was "quite strange," it does happen -- and increasingly more so lately, as lenders, attorneys and the courts scramble to push a huge number of foreclosures through the pipeline.
While there is no specific statute addressing double sales, Wilson said basic common law suggests that the first person buying the property would have the first rights to it. But the outcome could vary according to the specifics in each case, Wilson said.
Jimenez, who came from Cuba five years ago, said he always assumed he would get to keep his home because he bought it first. He already has started renovating the kitchen and decorated the yard with holiday lights.
Read more: http://www.miamiherald.com/2010/12/07/1960976/foreclosed-home-mistakenly-sold.html#ixzz17SKbOXR6
BY DIANE C. LADE AND DOREEN HEMLOCK
Sun Sentinel
Real estate investor Marjorie Oster was pleased when she snagged what looked like a good deal through a Miami-Dade County foreclosure court auction: a four-bedroom house in Cutler Bay, with a swimming pool, for about $95,000.
But when her husband drove by the next day to check on the property, he saw "someone cleaning the pool, a lawn service cutting the grass and a note it was being tented for termites," said Oster, a Miami resident who has been in real estate for 15 years.
It turns out the house she thought she had purchased had been sold in a short sale the week before to someone else -- Osberto Jimenez, a 40-year-old truck driver. The law firm handling the foreclosure for the lender mishandled the paperwork and never canceled the auction sale.
"So we both own the same house and I'm frustrated as hell," Oster said. "Someone screwed up."
New attorneys representing CitiMortgage say that "someone" was David Stern's beleaguered law office, which originally represented the lender. Citi ultimately pulled the case from Stern's offices and gave it to Shapiro and Fishman, another large South Florida foreclosure firm that represents banks and loan servicers.
Both law offices, along with two others, are under investigation by the Florida Attorney General. They're accused of engaging in shoddy practices, including fabricating documents. Shapiro and Fishman has defended its practices and said it did nothing wrong. Jeffrey Tew, the attorney representing Stern, declined to comment.
Stern, who at one point claimed he processed 20 percent of the state's foreclosures through a staff of more than 1,000, has been forced to lay off the vast majority of his employees as his biggest clients continue to abandon him. Citi spokesman Mark Rodgers declined to comment specifically on the Cutler Bay double sale, but said the company stopped referring new foreclosures to Stern in September and now has removed all of its business from the firm.
Attorneys general in 50 states continue to investigate reports of servicers and foreclosure firms like Stern's "robo-signing" hundreds of thousands of affidavits without reviewing them.
In the situation with the Cutler Bay house, attorney Leora B. Freire, with Shapiro and Fishman, said Stern's office didn't notify the courts to take the house out of the foreclosure auction after the short sale had been processed.
Oster and Citi reached an agreement last week, Freire said, vacating Oster's sale, which allows Jimenez to keep the house. Oster said she would be refunded her money, paid some interest, and have her legal fees covered.
Documents show Oster bought the property for cash on Oct. 6 and received a certificate of title. Seven days earlier, Jimenez executed a warranty deed and took out a $123,000 mortgage in a short sale approved by CitiMortgage and the previous owners.
The tsunami of negative news about Stern's operation had Oster fearing she never would see her money again. She said she contacted the office numerous times for more than a month, but attorneys either would not return her calls or couldn't tell her what had happened to her payment.
"I just wanted out because it was David Stern's firm," she said.
Mortgage giants Fannie Mae and Freddie Mac, who comprised the majority of Stern's referrals, pulled all of their cases from the firm over the past two months. Shapiro and Fishman, however, remain on Fannie's referral list.
Darryl Wilson, a professor and real estate expert at Stetson University's College of Law, said that while selling the same house twice was "quite strange," it does happen -- and increasingly more so lately, as lenders, attorneys and the courts scramble to push a huge number of foreclosures through the pipeline.
While there is no specific statute addressing double sales, Wilson said basic common law suggests that the first person buying the property would have the first rights to it. But the outcome could vary according to the specifics in each case, Wilson said.
Jimenez, who came from Cuba five years ago, said he always assumed he would get to keep his home because he bought it first. He already has started renovating the kitchen and decorated the yard with holiday lights.
Read more: http://www.miamiherald.com/2010/12/07/1960976/foreclosed-home-mistakenly-sold.html#ixzz17SKbOXR6
Monday, November 15, 2010
Home Buyers, Lenders Get Creative to Make Deals - November 14, 2010
BY NIRVI SHAH, INA PAIVA CORDLE AND TOLUSE OLORUNNIPA
nshah@MiamiHerald.com
When Efrain Hernandez couldn't seal a deal before the first-time home buyer tax credit expired earlier this year, he lost faith that he would ever own a house in a market where investors and all-cash buyers are snapping up bargains and mortgages seem hard to come by.
But waiting -- even though it wasn't by choice -- got him more than the $8,000 federal tax credit.
In a single day last month, Hernandez negotiated a contract on a five-bedroom, three-bath home in the Silver Palms development between Cutler Bay and Homestead. By the end of October, he closed, talking homebuilder Lennar into a $40,000 discount off the list price, getting it to pay $18,000 in closing costs and scoring a $7,500 no-interest loan from Miami-Dade County to lighten his down payment.
"I was finally able to buy the house of my dreams," Hernandez said. "Even though the tax credit was over, it ended up being a better deal."
While cash is king when it comes to buying properties in South Florida's battered housing market, new homeowners like Hernandez are finding ways to finance their homes using hard-nosed negotiation tactics and unusual financing options they never needed during the boom.
And they are scoring deals on homes -- not bedraggled or cut-rate foreclosure properties and time-consuming short sales, but well-kept homes with current mortgages.
After a long drought, more money is becoming available to buy homes. Take Wells Fargo Home Mortgage, for instance. André Brooks, vice president and regional sales manager for the bank's Florida operation, said his company has made more than $3 billion in mortgages so far this year in Florida, nearly 20 percent more than last year.
However, lending guidelines remain restrictive, said Terry H. Francisco, spokesman with Bank of America. Unlike the loose-money days of the real estate boom, people are having to painstakingly document their creditworthiness.
Making purchases happen now often requires creativity and calculation.
"Creative financing is about to become the primary means of financing." said Joe Manausa, a broker and owner of a Century 21 First Realty in Tallahassee, who has blogged about the topic.
BEST WAY?
One fruitful financing option is a loan backed by the Federal Housing Administration. FHA loans can require a down payment of just 3.5 percent compared with the much larger upfront investments many banks require. There have been three times as many FHA loans statewide this year as five years ago.
"FHA is popular again. It went away when we did that `You-don't-have-to-ask-me-for-anything' " no-income-verification kind of loan, said Patricia Perez, senior loan officer at Sunbelt Lending, which works with Coldwell Banker clients.
And in the current market, where home values continue to drop and buyers of just a year or two ago may already owe more than their properties are worth, Perez said it makes sense not to make a big down payment.
"I would rather have my $50,000 parked in my bank account for emergencies," she said.
FHA loans do have their limitations. For one, like other loans with a down payment below 20 percent, these require the buyer to get mortgage insurance.
Another limiting factor: FHA loans are for a maximum of $423,750 in Florida -- although that takes in a lot of properties, when you consider the median South Florida home price is around $200,000. They are available to people who don't already have an FHA loan and plan to make the property their primary residence.
PRIVATE LOANS
A private loan -- made by a noninstitutional investor who does not advertise himself or herself as a mortgage lender -- is another alternative, but requires some networking and using personal relationships to make a connection.
Grant S. Stern, president of Morningside Mortgage Corp. in Bay Harbor Islands, brokered a loan this summer for a buyer of a Broward condo, financing half the purchase price.
The borrower had made a preconstruction down payment of $90,000 on a two-bedroom, two-bath $300,000 condo in Sunrise. He had another $65,000 cash to close, but during the lending process, Fannie Mae's approval for the project expired.
Stern said he learned that the developer was on the verge of default, and that his client's money was in jeopardy if he didn't close the deal quickly. There wasn't enough time to get a conventional bank loan, so Stern arranged for a real estate investor to fund a five-year, fixed-rate loan in a hurry.
"They said `close in one week.' We closed in one week," he said.
The borrower, a 35-year-old wholesale electronics distributor with good credit, could conceivably arrange a more conventional refinance in the future.
"If this is the only way you are going to close, then it's a really good option," Stern said.
SELLER FINANCING
Part of real estate agent Gene Mastro's strategy for buyers is avoiding foreclosures and short sales -- especially for those buyers who intend to live in the properties they purchase.
Owners of nondistressed properties are "more ready to correct problems, any minor deficiencies," said Mastro, who works for Coldwell Banker in Miami-Dade.
Another advantage: Sellers may be willing to pay all or part of closing costs, which can range from 2 percent to 7 percent of the purchase price.
Dilihara Martin said Mastro negotiated a seller's contribution for closing costs on a home she bought near Kendall this month. The 1,700-square-foot home sits on nearly a quarter-acre.
Martin, 25, said the new place will be a nice change for her, her husband Julio and 6-month-old daughter Isabella, who have been living with her parents.
"He managed to negotiate down to $200,000 and we got a 3 percent seller's contribution on top of that," said Martin, an accountant. "He fights for you."
Another client, Daniel Diaz, closes later this month on a three-bedroom, two-bath home in Kendall. The price is $150,000. Though Diaz, 28, said he's a saver, he doesn't have enough put away for a 20 percent down payment, so he opted for an FHA-backed loan.
The sellers will contribute 4 percent of the home's purchase price toward closing costs, said Diaz, who manages a Sports Grill.
"I had no idea about this," he said. "Gene's been educating me along the way."
QUICKIE LOANS
Another way to cover closing costs is a fast, short-term loan that doesn't show up on credit reports.
Todd Hills noticed that some of the recent users of his company, Boomerang Loans, wanted fast cash to pay closing costs. His Colorado-based business works like a pawn shop for those with pricier assets, including paintings and fine jewelry. A recent borrower offered a 1955 Picasso sketch.
"It's not something we've experienced before the last six months," said Hills, CEO of the 25-year-old company, but "it makes absolutely perfect sense. This is a way this consumer can get the cash that they need."
A Texas woman who recently needed an additional $3,500 to pay closing costs sent the company several pieces of jewelry. They gave her the money and she was able to close.
"They get their house deal done, then they have six months to make the determination about whether they want to come back and retrieve their asset," Hills said.
OPTION TO BUY
Yet another possibility for buyers is a lease-to-own option, Manausa said. "It's a purchase agreement with a very delayed closing -- three months or three years."
Tom Nisbet and fiancée Greta Leber have just such a contract on a condo near Dadeland Mall. They are living in the 1,600-square-foot unit they hope to buy. It comes with two parking spaces, a pool, a gym and it's close enough to the University of Miami, where Leber is working on her Ph.D.
After watching others' experiences with short sales and foreclosures, they steered clear. "This is by far the best place we saw on the market," Nisbet said.
In their case, they have a contract that is contingent on being able to secure an FHA loan for the unit. It's in a building that is not currently approved for those kinds of mortgages. The couple -- he is 25, and she is 23 -- don't have the kind of savings needed for a down payment for a traditional mortgage.
"Our sales contract is valid until we hear we have FHA approval or not, or up to a year from now," Nisbet said. "Maybe, depending on the situation we're in, we'll keep renting this place."
THE GOVERNMENT
While the federal first-time home buyer's tax credit ended months ago, as Hernandez found, it's not too late for house hunters to get government home-buying help.
Hernandez benefited from Miami-Dade County's "surtax" program, which provides a no- or low-interest second mortgage for middle-income home buyers, who can cash in on up to $7,500 in assistance.
The program covers first-time home buyers whose household income does not exceed 140 percent of the area's median, or below $98,438 for a family of four.
The Broward County Housing Finance and Community Development Division has a similar program for first-timers, offering a loan with a 3 percent down payment and below-market fixed interest rate that doesn't require private mortgage insurance.
Additionally, many city governments offer their own home buyer subsidies, like Hollywood's no-interest second mortgage, which provides up to $40,000 or 25 percent of the purchase price to assist low-income buyers.
Government agencies with home-buying assistance programs say they are fielding lots of calls.
"People are interested in buying homes," said Mildred Reynolds, housing program manager for Broward County. She suggests people considering a purchase visit a Housing and Urban Development office to learn about their options.
Hernandez, who closed on a home after two years of searching, learned about the surtax program from Lennar.
"We're just trying to put everything together to make that sale happen," new home consultant Florinda Beguiristain said. The home she found for Hernandez was built by Lennar, went into foreclosure, then was bought back and refurbished by Lennar. "He said `Flori, you don't know what I've gone through.' "
"We enjoy being able to see that dream came true."
Read more: http://www.miamiherald.com/2010/11/14/v-fullstory/1924932/home-buyers-lenders-get-creative.html#ixzz15NI851zK
Looking to buy a home in Miami? We can help you with all of these financing options and more. Call us today at 305-456-6456 or click http://www.MiamiRealEstateUSA.com for more information.
nshah@MiamiHerald.com
When Efrain Hernandez couldn't seal a deal before the first-time home buyer tax credit expired earlier this year, he lost faith that he would ever own a house in a market where investors and all-cash buyers are snapping up bargains and mortgages seem hard to come by.
But waiting -- even though it wasn't by choice -- got him more than the $8,000 federal tax credit.
In a single day last month, Hernandez negotiated a contract on a five-bedroom, three-bath home in the Silver Palms development between Cutler Bay and Homestead. By the end of October, he closed, talking homebuilder Lennar into a $40,000 discount off the list price, getting it to pay $18,000 in closing costs and scoring a $7,500 no-interest loan from Miami-Dade County to lighten his down payment.
"I was finally able to buy the house of my dreams," Hernandez said. "Even though the tax credit was over, it ended up being a better deal."
While cash is king when it comes to buying properties in South Florida's battered housing market, new homeowners like Hernandez are finding ways to finance their homes using hard-nosed negotiation tactics and unusual financing options they never needed during the boom.
And they are scoring deals on homes -- not bedraggled or cut-rate foreclosure properties and time-consuming short sales, but well-kept homes with current mortgages.
After a long drought, more money is becoming available to buy homes. Take Wells Fargo Home Mortgage, for instance. André Brooks, vice president and regional sales manager for the bank's Florida operation, said his company has made more than $3 billion in mortgages so far this year in Florida, nearly 20 percent more than last year.
However, lending guidelines remain restrictive, said Terry H. Francisco, spokesman with Bank of America. Unlike the loose-money days of the real estate boom, people are having to painstakingly document their creditworthiness.
Making purchases happen now often requires creativity and calculation.
"Creative financing is about to become the primary means of financing." said Joe Manausa, a broker and owner of a Century 21 First Realty in Tallahassee, who has blogged about the topic.
BEST WAY?
One fruitful financing option is a loan backed by the Federal Housing Administration. FHA loans can require a down payment of just 3.5 percent compared with the much larger upfront investments many banks require. There have been three times as many FHA loans statewide this year as five years ago.
"FHA is popular again. It went away when we did that `You-don't-have-to-ask-me-for-anything' " no-income-verification kind of loan, said Patricia Perez, senior loan officer at Sunbelt Lending, which works with Coldwell Banker clients.
And in the current market, where home values continue to drop and buyers of just a year or two ago may already owe more than their properties are worth, Perez said it makes sense not to make a big down payment.
"I would rather have my $50,000 parked in my bank account for emergencies," she said.
FHA loans do have their limitations. For one, like other loans with a down payment below 20 percent, these require the buyer to get mortgage insurance.
Another limiting factor: FHA loans are for a maximum of $423,750 in Florida -- although that takes in a lot of properties, when you consider the median South Florida home price is around $200,000. They are available to people who don't already have an FHA loan and plan to make the property their primary residence.
PRIVATE LOANS
A private loan -- made by a noninstitutional investor who does not advertise himself or herself as a mortgage lender -- is another alternative, but requires some networking and using personal relationships to make a connection.
Grant S. Stern, president of Morningside Mortgage Corp. in Bay Harbor Islands, brokered a loan this summer for a buyer of a Broward condo, financing half the purchase price.
The borrower had made a preconstruction down payment of $90,000 on a two-bedroom, two-bath $300,000 condo in Sunrise. He had another $65,000 cash to close, but during the lending process, Fannie Mae's approval for the project expired.
Stern said he learned that the developer was on the verge of default, and that his client's money was in jeopardy if he didn't close the deal quickly. There wasn't enough time to get a conventional bank loan, so Stern arranged for a real estate investor to fund a five-year, fixed-rate loan in a hurry.
"They said `close in one week.' We closed in one week," he said.
The borrower, a 35-year-old wholesale electronics distributor with good credit, could conceivably arrange a more conventional refinance in the future.
"If this is the only way you are going to close, then it's a really good option," Stern said.
SELLER FINANCING
Part of real estate agent Gene Mastro's strategy for buyers is avoiding foreclosures and short sales -- especially for those buyers who intend to live in the properties they purchase.
Owners of nondistressed properties are "more ready to correct problems, any minor deficiencies," said Mastro, who works for Coldwell Banker in Miami-Dade.
Another advantage: Sellers may be willing to pay all or part of closing costs, which can range from 2 percent to 7 percent of the purchase price.
Dilihara Martin said Mastro negotiated a seller's contribution for closing costs on a home she bought near Kendall this month. The 1,700-square-foot home sits on nearly a quarter-acre.
Martin, 25, said the new place will be a nice change for her, her husband Julio and 6-month-old daughter Isabella, who have been living with her parents.
"He managed to negotiate down to $200,000 and we got a 3 percent seller's contribution on top of that," said Martin, an accountant. "He fights for you."
Another client, Daniel Diaz, closes later this month on a three-bedroom, two-bath home in Kendall. The price is $150,000. Though Diaz, 28, said he's a saver, he doesn't have enough put away for a 20 percent down payment, so he opted for an FHA-backed loan.
The sellers will contribute 4 percent of the home's purchase price toward closing costs, said Diaz, who manages a Sports Grill.
"I had no idea about this," he said. "Gene's been educating me along the way."
QUICKIE LOANS
Another way to cover closing costs is a fast, short-term loan that doesn't show up on credit reports.
Todd Hills noticed that some of the recent users of his company, Boomerang Loans, wanted fast cash to pay closing costs. His Colorado-based business works like a pawn shop for those with pricier assets, including paintings and fine jewelry. A recent borrower offered a 1955 Picasso sketch.
"It's not something we've experienced before the last six months," said Hills, CEO of the 25-year-old company, but "it makes absolutely perfect sense. This is a way this consumer can get the cash that they need."
A Texas woman who recently needed an additional $3,500 to pay closing costs sent the company several pieces of jewelry. They gave her the money and she was able to close.
"They get their house deal done, then they have six months to make the determination about whether they want to come back and retrieve their asset," Hills said.
OPTION TO BUY
Yet another possibility for buyers is a lease-to-own option, Manausa said. "It's a purchase agreement with a very delayed closing -- three months or three years."
Tom Nisbet and fiancée Greta Leber have just such a contract on a condo near Dadeland Mall. They are living in the 1,600-square-foot unit they hope to buy. It comes with two parking spaces, a pool, a gym and it's close enough to the University of Miami, where Leber is working on her Ph.D.
After watching others' experiences with short sales and foreclosures, they steered clear. "This is by far the best place we saw on the market," Nisbet said.
In their case, they have a contract that is contingent on being able to secure an FHA loan for the unit. It's in a building that is not currently approved for those kinds of mortgages. The couple -- he is 25, and she is 23 -- don't have the kind of savings needed for a down payment for a traditional mortgage.
"Our sales contract is valid until we hear we have FHA approval or not, or up to a year from now," Nisbet said. "Maybe, depending on the situation we're in, we'll keep renting this place."
THE GOVERNMENT
While the federal first-time home buyer's tax credit ended months ago, as Hernandez found, it's not too late for house hunters to get government home-buying help.
Hernandez benefited from Miami-Dade County's "surtax" program, which provides a no- or low-interest second mortgage for middle-income home buyers, who can cash in on up to $7,500 in assistance.
The program covers first-time home buyers whose household income does not exceed 140 percent of the area's median, or below $98,438 for a family of four.
The Broward County Housing Finance and Community Development Division has a similar program for first-timers, offering a loan with a 3 percent down payment and below-market fixed interest rate that doesn't require private mortgage insurance.
Additionally, many city governments offer their own home buyer subsidies, like Hollywood's no-interest second mortgage, which provides up to $40,000 or 25 percent of the purchase price to assist low-income buyers.
Government agencies with home-buying assistance programs say they are fielding lots of calls.
"People are interested in buying homes," said Mildred Reynolds, housing program manager for Broward County. She suggests people considering a purchase visit a Housing and Urban Development office to learn about their options.
Hernandez, who closed on a home after two years of searching, learned about the surtax program from Lennar.
"We're just trying to put everything together to make that sale happen," new home consultant Florinda Beguiristain said. The home she found for Hernandez was built by Lennar, went into foreclosure, then was bought back and refurbished by Lennar. "He said `Flori, you don't know what I've gone through.' "
"We enjoy being able to see that dream came true."
Read more: http://www.miamiherald.com/2010/11/14/v-fullstory/1924932/home-buyers-lenders-get-creative.html#ixzz15NI851zK
Looking to buy a home in Miami? We can help you with all of these financing options and more. Call us today at 305-456-6456 or click http://www.MiamiRealEstateUSA.com for more information.
Monday, November 8, 2010
Construction Set to Begin on Downtown Whole Foods - November 8, 2010
Downtown residents and workers will be getting a place for organic and gourmet shopping. Whole Foods is to open at Metropolitan Miami.
BY ELAINE WALKER
ewalker@MiamiHerald.com
Plans for a Whole Foods in Downtown Miami are officially back on track, offering another vote of confidence in the area's rebirth.
The upscale organic grocery chain confirmed Friday that it will open a 37,000-square-foot store at the Metropolitan Miami complex. The grocer had originally committed to open at the project back in 2004. But the deal fell apart a couple of years ago when plans for the Met 3 building got put on hold amid the real estate collapse.
Florida Whole Foods President Juan Núñez said the company never waivered in its interest, but had to wait to see the new plans.
"We always liked the downtown site," Núñez said. "These are some of the greatest densities. We really think that the customer demand is here."
The new plans call for a store about 25 percent smaller than originally envisioned. Whole Foods customers will have free, dedicated parking under the store and above will be a public parking garage with room for more than 1,200 cars.
Construction will begin sometime next year with an opening likely in late 2013.
"We're excited that Whole Foods is back," said Tim Weller, vice president of MDM Development Group. "We think it's an extremely important element of the Metropolitan Miami community. It completes the vision we had of creating a neighborhood in an urban setting."
NO CONDO UNITS
Part of the Met 3 site will also be saved for Phase 2, which would likely include a hospitality company, Weller said. Unlike the original plan that called for a 74-story building with 650 condos above Whole Foods, this time there are no condo units involved.
The Whole Foods is the beginning of the expected retail and entertainment component for the Metropolitan Miami project, which already includes condominiums, the new Wells Fargo Center office tower and the J.W. Marriott Marquis and Hotel Beaux Arts. The Whole Foods announcement came Friday, as the J.W. Marriott Marquis celebrated its grand opening with a lunch that attracted about 600 people to downtown.
Alyce Robertson, executive director of the Miami Downtown Development Authority, hopes the Whole Foods will be a sign of other major national retailers to come.
"What it says is that companies are recognizing what's happening here," she said.
Helping Whole Foods and others to make that decision is certainly evidence that the majority of new downtown condominiums are filled with either renters or buyers.
"When Whole Foods enters a market, it says that this is a real credible educated demographic," said Lyle Stern, a Miami Beach broker, who represents Whole Foods and the Met. "It's a signal to the world that all of this is real."
Read more: http://www.miamiherald.com/2010/11/06/1911156/construction-set-to-begin-on-downtown.html#ixzz14i1E14P9
BY ELAINE WALKER
ewalker@MiamiHerald.com
Plans for a Whole Foods in Downtown Miami are officially back on track, offering another vote of confidence in the area's rebirth.
The upscale organic grocery chain confirmed Friday that it will open a 37,000-square-foot store at the Metropolitan Miami complex. The grocer had originally committed to open at the project back in 2004. But the deal fell apart a couple of years ago when plans for the Met 3 building got put on hold amid the real estate collapse.
Florida Whole Foods President Juan Núñez said the company never waivered in its interest, but had to wait to see the new plans.
"We always liked the downtown site," Núñez said. "These are some of the greatest densities. We really think that the customer demand is here."
The new plans call for a store about 25 percent smaller than originally envisioned. Whole Foods customers will have free, dedicated parking under the store and above will be a public parking garage with room for more than 1,200 cars.
Construction will begin sometime next year with an opening likely in late 2013.
"We're excited that Whole Foods is back," said Tim Weller, vice president of MDM Development Group. "We think it's an extremely important element of the Metropolitan Miami community. It completes the vision we had of creating a neighborhood in an urban setting."
NO CONDO UNITS
Part of the Met 3 site will also be saved for Phase 2, which would likely include a hospitality company, Weller said. Unlike the original plan that called for a 74-story building with 650 condos above Whole Foods, this time there are no condo units involved.
The Whole Foods is the beginning of the expected retail and entertainment component for the Metropolitan Miami project, which already includes condominiums, the new Wells Fargo Center office tower and the J.W. Marriott Marquis and Hotel Beaux Arts. The Whole Foods announcement came Friday, as the J.W. Marriott Marquis celebrated its grand opening with a lunch that attracted about 600 people to downtown.
Alyce Robertson, executive director of the Miami Downtown Development Authority, hopes the Whole Foods will be a sign of other major national retailers to come.
"What it says is that companies are recognizing what's happening here," she said.
Helping Whole Foods and others to make that decision is certainly evidence that the majority of new downtown condominiums are filled with either renters or buyers.
"When Whole Foods enters a market, it says that this is a real credible educated demographic," said Lyle Stern, a Miami Beach broker, who represents Whole Foods and the Met. "It's a signal to the world that all of this is real."
Read more: http://www.miamiherald.com/2010/11/06/1911156/construction-set-to-begin-on-downtown.html#ixzz14i1E14P9
Saturday, October 30, 2010
Market Bright Spot: Condos in Dade - October 26, 2010
Miami-Dade condominium sales were up significantly in September compared to last year, but single-family home sales and prices were down throughout South Florida.
BY TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
As South Florida's shaky real estate market searches for recovery, an investor group's $1 billion bet on the local condominium market is about to be put to the test.
Starwood Capital-led investor group ST Residential -- in charge of more than 1,200 new condo units in South Florida -- launched its ST Miami initiative this month, announcing plans to release hundreds of new condo units into South Florida's fragile market in the coming months.
Condo sales were the standout figure in the September existing sales report released Monday by the Miami Association of Realtors.
Existing condo sales in Miami-Dade County rose 36 percent in September compared to the same month last year, with 833 sales closed. Month over month, sales were down 2.8 percent, despite a 5 percent decline in median prices. In Broward County, condo sales slid to 828, down 4 percent from September of last year.
Existing single-family home sales continued their descent in September, falling 6 percent year over year in Miami-Dade, with 582 sales. In Broward, year-over-year single family sales dropped 16 percent to 673.
Nationally, the housing market improved in September, with existing sales increasing 10 percent from August.
Prices are still falling in many sectors of the housing market, but ST Residential CEO Wade Hundley said brand new condos have avoided that fate this year, even posting increases.
"Relative to all the other markets in the U.S., Miami is doing well," Hundley said. "We've seen prices increase about 10 to 15 percent since the beginning of the year."
ST Residential became a major player in South Florida's real estate market about a year ago when it bought a stake in the distressed real estate portfolio of failed Chicago-based Corus Bank. In a public-private deal with the Federal Deposit Insurance Corporation, ST Residential bought into a portfolio of condo projects that includes Paramount Bay in Miami, Jade Ocean Condominiums in Sunny Isles Beach and Tao in Sunrise.
The purchase made ST the second-largest owner of developer units in Miami's downtown condo market, behind Jorge Perez's Related Group, and the public-private deal gave the investor group the flexibility to adjust pricing levels.
ST Residential is "coming in at a time when prices have stabilized, and they're creeping upwards, in that Brickell-downtown area," said David Dabby, a real estate analyst with Dabby Group Advisors. "The market is weak overall, but there's enough acquisition activity to begin moving that [developer] inventory."
Dabby noted however, that prices are still 50 percent below where they were four years ago, and not likely to make significant gains anytime soon, since discounted foreclosures and short sales rule the market.
Distressed properties are responsible for more than half of existing home sales in South Florida, dragging down median prices.
In September, year-over-year housing prices fell nearly across the board, with Broward single-family homes standing out as the sole exception. The median priced home in Broward sold for $214,200, up 7 percent compared to last September. Broward condo prices were down 9 percent to $71,600. In Miami-Dade, condo prices fell 25 percent to $99,400, and single-family home prices fell 2 percent to $188,000.
ST Residential plans to relaunch 530-unit Mint on the Miami River into the market in December and will kickstart sales at the 346-unit Paramount Bay on Biscayne Bay north of the Performing Arts Center next year, pricing units "at market" rates, Hundley said.
"We control so much inventory that if we come in at very low price point we could disrupt the market," he said. "And we don't want to do that."
Read more: http://www.miamiherald.com/2010/10/26/1891129/market-bright-spot-condos-in-dade.html#ixzz13rhhj1Qc
BY TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
As South Florida's shaky real estate market searches for recovery, an investor group's $1 billion bet on the local condominium market is about to be put to the test.
Starwood Capital-led investor group ST Residential -- in charge of more than 1,200 new condo units in South Florida -- launched its ST Miami initiative this month, announcing plans to release hundreds of new condo units into South Florida's fragile market in the coming months.
Condo sales were the standout figure in the September existing sales report released Monday by the Miami Association of Realtors.
Existing condo sales in Miami-Dade County rose 36 percent in September compared to the same month last year, with 833 sales closed. Month over month, sales were down 2.8 percent, despite a 5 percent decline in median prices. In Broward County, condo sales slid to 828, down 4 percent from September of last year.
Existing single-family home sales continued their descent in September, falling 6 percent year over year in Miami-Dade, with 582 sales. In Broward, year-over-year single family sales dropped 16 percent to 673.
Nationally, the housing market improved in September, with existing sales increasing 10 percent from August.
Prices are still falling in many sectors of the housing market, but ST Residential CEO Wade Hundley said brand new condos have avoided that fate this year, even posting increases.
"Relative to all the other markets in the U.S., Miami is doing well," Hundley said. "We've seen prices increase about 10 to 15 percent since the beginning of the year."
ST Residential became a major player in South Florida's real estate market about a year ago when it bought a stake in the distressed real estate portfolio of failed Chicago-based Corus Bank. In a public-private deal with the Federal Deposit Insurance Corporation, ST Residential bought into a portfolio of condo projects that includes Paramount Bay in Miami, Jade Ocean Condominiums in Sunny Isles Beach and Tao in Sunrise.
The purchase made ST the second-largest owner of developer units in Miami's downtown condo market, behind Jorge Perez's Related Group, and the public-private deal gave the investor group the flexibility to adjust pricing levels.
ST Residential is "coming in at a time when prices have stabilized, and they're creeping upwards, in that Brickell-downtown area," said David Dabby, a real estate analyst with Dabby Group Advisors. "The market is weak overall, but there's enough acquisition activity to begin moving that [developer] inventory."
Dabby noted however, that prices are still 50 percent below where they were four years ago, and not likely to make significant gains anytime soon, since discounted foreclosures and short sales rule the market.
Distressed properties are responsible for more than half of existing home sales in South Florida, dragging down median prices.
In September, year-over-year housing prices fell nearly across the board, with Broward single-family homes standing out as the sole exception. The median priced home in Broward sold for $214,200, up 7 percent compared to last September. Broward condo prices were down 9 percent to $71,600. In Miami-Dade, condo prices fell 25 percent to $99,400, and single-family home prices fell 2 percent to $188,000.
ST Residential plans to relaunch 530-unit Mint on the Miami River into the market in December and will kickstart sales at the 346-unit Paramount Bay on Biscayne Bay north of the Performing Arts Center next year, pricing units "at market" rates, Hundley said.
"We control so much inventory that if we come in at very low price point we could disrupt the market," he said. "And we don't want to do that."
Read more: http://www.miamiherald.com/2010/10/26/1891129/market-bright-spot-condos-in-dade.html#ixzz13rhhj1Qc
Monday, October 25, 2010
Miami Heat's Big Three a Boon to Neighboring Condos - October 25, 2010
Real estate stakeholders near Miami's arena are counting on LeBron James, Dwyane Wade and Chris Bosh to give an economic lift to neighboring buildings.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Drivers making their way east on Interstate 395 toward the exit marked "Arenas" can't help but notice the four skyscrapers towering over downtown Miami -- the highway seems to steer directly into them before curving off to the shores of South Beach.
As more cars and more cameras will be taking that exit to the arena where basketball giant LeBron James will bring his talents this season, downtown Miami's condo developers are looking to cash in on the new-found cachet of the Miami Heat team.
Developers of the four skyline-shaping condo towers across the street from American Airlines Arena -- Marina Blue, 900 Biscayne Bay, Ten Museum Park and Marquis Residences -- are hoping James and Co. can increase their buildings' clout and help them sell virgin square feet.
Some say that's already happening.
"You can call the sales office and sometimes not get through to anyone because they're so busy," said Lori Levine Ordover, director of sales for Marquis developer Africa Israel USA. "That bodes well for what's going to happen this season."
With restaurants, retail space and residential units to fill, downtown's stakeholders are bracing themselves for the yet-to-be-known impact of the new Miami Heat, as the regular season starts Tuesday against the Celtics in Boston. The home opener is Friday against Orlando.
Built during the mid-decade developers boom, the four condo buildings closest to the arena symbolize the spectrum of real estate highs and lows in South Florida over the past five years.
Two of the buildings sold out quickly as the market peaked, while two others still have a glut of unsold units available at off-peak prices. Buyers in the properties enjoy top-of-the-line amenities, but many have seen their home values plummet during the market crash. In all four buildings, thousands of square feet of office and retail space sit empty at the base of the towers.
While real estate analysts acknowledge that James' arrival in Miami won't cause a massive condo-buying stampede or heal the city's battered housing market, there is growing evidence that the new Heat lineup is spurring activity in the area around the arena.
At the Marquis, 1100 Biscayne Blvd., a penthouse unit sold for $4.2 million on July 8, the same day James announced he would be joining the Heat. That purchase was the largest amount ever paid for a condo in the downtown area, and the businessman who bought the unit admitted proximity to the arena influenced his decision.
"I'm a big basketball fan and we chose the Marquis because we like the building and the location," said Russell Wright, who has floor-level season tickets for the Heat games. "At first, I was just hoping that Dwyane Wade would re-sign -- I had no clue that LeBron and Chris Bosh would join him."
At Marina Blue, 888 Biscayne Blvd., a Sunny Isles Beach investor scooped up 5,100 square feet of retail space in August, netting the sellers $2.1 million. That investor, Sergey Novov, has drawn up plans to build a microbrewery there.
There are also reports of rising rent prices, game-day sellouts at hotels and soon-to-come hangout spots within walking distance of the arena.
With economists calculating James' impact in Cleveland in the hundreds of millions of dollars during his seven-year tenure there, Miami stakeholders are maneuvering to cash in on the star's presence once the season starts.
"I think downtown is just coming into fruition, coupled with the Heat stars and all that's going on there," said Penni Chasens, a real estate agent who has been selling developer units at 900 Biscayne Bay and the Marquis. "I think it's given us a shot in the arm that we needed."
The four towers are likely to be in hundreds of aerial shots of Miami's skyline during internationally televised Heat games, and each is looking to gain from that exposure.
Here is a look at each building.
MARINA BLUE
The southernmost building among the group, Marina Blue, pitches itself as one of the healthiest buildings downtown. The developer's residential units are completely sold out and the Castle Group, which manages the building, said more than 95 percent of the 516 units are occupied.
The so-called "LeBron Effect" made its mark in the building's retail sector, which had been sitting empty and unheralded for two years.
"The week that the LeBron announcement came -- we sold three commercial units immediately," said Donald Campbell, general manager at the 57-story Marina Blue. "They started construction three days later."
The micro-brewery envisioned by Novov, the investor, is in a frenzy to open as soon as possible, Campbell said.
Another restaurant is set to open there early next year, pitching Brooklyn-style pizza and plasma TVs to sports fans. A sign hanging in front of its undeveloped space plays into the hoops-generated hype: "Pucci's Pizza: Coming soon. Before the playoffs (hopefully)."
A Spain-based advertising agency, Tribeca Media, also scooped up about 5,000 square feet in the building shortly after James announced he'd be joining Wade and Bosh in Miami.
On the residential side, rental interest has grown over the summer. Selling prices averaged about $350 per-square-foot during the boom, and many investors have had to buffer falling values by renting units during the market downturn.
"Some of our investors are taking the opportunity to raise their rent [asking] prices," Campbell said. "If we have someone move out, we'll have someone new in there within the week."
MARQUIS RESIDENCES
Marquis Residences, the tallest of the four structures, probably has the most to gain from increased attention and foot traffic around the arena. The 67-story structure has more than 200 unsold condos, and a recently opened hotel, restaurant and lounge that could benefit from pre- and post-game patrons.
Ordover, the sales director, said the Heat's new lineup has already increased interest in the luxury building, and residential "sales have been good and steady."
She attributes at least three recent sales directly to the Heat effect, including the $4.2 million penthouse purchase. With a typical two-bedroom trading for more than $500,000 at Marquis, that's about $5 million in revenue that can be tied to the team across the street.
As the tallest residential skyscraper in the state, Marquis will stand out as aerial cameras zoom in on the city during more than 30 nationally televised Heat games this season.
Ordover is hoping to parlay that free advertising into increased interest at the building's boutique hotel, and has placed ads in Heat game programs and the team's commemorative yearbook.
One ad for Tempo, the hotel, describes the building as "within three-point range of the arena."
Those kinds of ads will be common this season, Ordover said, as they have already shown results.
"I have a room in the hotel, because I travel back and forth. Now the hotel has so many nights of 100 percent occupancy that they're kicking me out," she said. "And it's directly correlated to the Heat games."
Out-of-town visitors searching online for the closest hotel to the arena will find Tempo listed at the top, 0.3 miles away, another marketing boost for the hotel, which opened in June. Rooms start at about $229.
The hotel has bought into the Heat mania, with player-based room specials tied to Wade, Bosh and James.
900 BISCAYNE BAY
The 900 Biscayne Bay condo tower, built in 2008, also has a large number of condos left on its rolls. The building has nearly 130 of its 509 developer units available and sold 18 units between July and September, according to data from real estate consultancy Condo Vultures.
Peter Zalewski, principal at Condo Vultures, said that with units going for $500,000 and more in buildings like 900 Biscayne Bay, the Heat effect will be limited.
"I don't think anyone is going to buy a residential property because of LeBron," he said. "But I do think that they're going to go to the bars and restaurants and get more comfortable with the area."
Owners of Miss Yip restaurant are counting on those expected bar-hoppers to help boost sales at the Chinese eatery's new downtown location at 900 Biscayne.
Shortly after the Heat play their first home game, the Chinese restaurant will open its downtown Miami branch, said Deniz Kose, the restaurant's manager. Miss Yip, a mainstay in Miami Beach since 2003, had contemplated expanding downtown long before this summer, but the Heat's revamped team was the tipping point.
"We have a lot of customers coming from downtown saying `I wish you had a location near me,' so it's the demand and supply thing," he said. "We expect to have even more people for the basketball games."
Still, the Heat effect at 900 Biscayne has been limited -- the building has a good chunk of vacant retail space near its bottom that has been for sale for more than a year.
TEN MUSEUM PARK
Ten Museum Park sold nearly all of its 200 units soon after being completed in 2007, and many boom-time investor-buyers have seen an uptick in rental interest this summer, said Shelly Abramowitz, owner of Museum Park Realty.
Those renters have helped the building reach near-full status, as they dish out $1,700 and more each month for one-bedrooms there.
The building has been a draw among the young professional crowd seeking big-city life, Abramowitz said.
"This neighborhood is spreading its wings right now by adding all these entertainment options," he said.
"That was what was missing before."
Read more: http://www.miamiherald.com/2010/10/24/v-fullstory/1889670/miami-heats-big-three-a-boon-to.html#ixzz13OqkL2DY
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Drivers making their way east on Interstate 395 toward the exit marked "Arenas" can't help but notice the four skyscrapers towering over downtown Miami -- the highway seems to steer directly into them before curving off to the shores of South Beach.
As more cars and more cameras will be taking that exit to the arena where basketball giant LeBron James will bring his talents this season, downtown Miami's condo developers are looking to cash in on the new-found cachet of the Miami Heat team.
Developers of the four skyline-shaping condo towers across the street from American Airlines Arena -- Marina Blue, 900 Biscayne Bay, Ten Museum Park and Marquis Residences -- are hoping James and Co. can increase their buildings' clout and help them sell virgin square feet.
Some say that's already happening.
"You can call the sales office and sometimes not get through to anyone because they're so busy," said Lori Levine Ordover, director of sales for Marquis developer Africa Israel USA. "That bodes well for what's going to happen this season."
With restaurants, retail space and residential units to fill, downtown's stakeholders are bracing themselves for the yet-to-be-known impact of the new Miami Heat, as the regular season starts Tuesday against the Celtics in Boston. The home opener is Friday against Orlando.
Built during the mid-decade developers boom, the four condo buildings closest to the arena symbolize the spectrum of real estate highs and lows in South Florida over the past five years.
Two of the buildings sold out quickly as the market peaked, while two others still have a glut of unsold units available at off-peak prices. Buyers in the properties enjoy top-of-the-line amenities, but many have seen their home values plummet during the market crash. In all four buildings, thousands of square feet of office and retail space sit empty at the base of the towers.
While real estate analysts acknowledge that James' arrival in Miami won't cause a massive condo-buying stampede or heal the city's battered housing market, there is growing evidence that the new Heat lineup is spurring activity in the area around the arena.
At the Marquis, 1100 Biscayne Blvd., a penthouse unit sold for $4.2 million on July 8, the same day James announced he would be joining the Heat. That purchase was the largest amount ever paid for a condo in the downtown area, and the businessman who bought the unit admitted proximity to the arena influenced his decision.
"I'm a big basketball fan and we chose the Marquis because we like the building and the location," said Russell Wright, who has floor-level season tickets for the Heat games. "At first, I was just hoping that Dwyane Wade would re-sign -- I had no clue that LeBron and Chris Bosh would join him."
At Marina Blue, 888 Biscayne Blvd., a Sunny Isles Beach investor scooped up 5,100 square feet of retail space in August, netting the sellers $2.1 million. That investor, Sergey Novov, has drawn up plans to build a microbrewery there.
There are also reports of rising rent prices, game-day sellouts at hotels and soon-to-come hangout spots within walking distance of the arena.
With economists calculating James' impact in Cleveland in the hundreds of millions of dollars during his seven-year tenure there, Miami stakeholders are maneuvering to cash in on the star's presence once the season starts.
"I think downtown is just coming into fruition, coupled with the Heat stars and all that's going on there," said Penni Chasens, a real estate agent who has been selling developer units at 900 Biscayne Bay and the Marquis. "I think it's given us a shot in the arm that we needed."
The four towers are likely to be in hundreds of aerial shots of Miami's skyline during internationally televised Heat games, and each is looking to gain from that exposure.
Here is a look at each building.
MARINA BLUE
The southernmost building among the group, Marina Blue, pitches itself as one of the healthiest buildings downtown. The developer's residential units are completely sold out and the Castle Group, which manages the building, said more than 95 percent of the 516 units are occupied.
The so-called "LeBron Effect" made its mark in the building's retail sector, which had been sitting empty and unheralded for two years.
"The week that the LeBron announcement came -- we sold three commercial units immediately," said Donald Campbell, general manager at the 57-story Marina Blue. "They started construction three days later."
The micro-brewery envisioned by Novov, the investor, is in a frenzy to open as soon as possible, Campbell said.
Another restaurant is set to open there early next year, pitching Brooklyn-style pizza and plasma TVs to sports fans. A sign hanging in front of its undeveloped space plays into the hoops-generated hype: "Pucci's Pizza: Coming soon. Before the playoffs (hopefully)."
A Spain-based advertising agency, Tribeca Media, also scooped up about 5,000 square feet in the building shortly after James announced he'd be joining Wade and Bosh in Miami.
On the residential side, rental interest has grown over the summer. Selling prices averaged about $350 per-square-foot during the boom, and many investors have had to buffer falling values by renting units during the market downturn.
"Some of our investors are taking the opportunity to raise their rent [asking] prices," Campbell said. "If we have someone move out, we'll have someone new in there within the week."
MARQUIS RESIDENCES
Marquis Residences, the tallest of the four structures, probably has the most to gain from increased attention and foot traffic around the arena. The 67-story structure has more than 200 unsold condos, and a recently opened hotel, restaurant and lounge that could benefit from pre- and post-game patrons.
Ordover, the sales director, said the Heat's new lineup has already increased interest in the luxury building, and residential "sales have been good and steady."
She attributes at least three recent sales directly to the Heat effect, including the $4.2 million penthouse purchase. With a typical two-bedroom trading for more than $500,000 at Marquis, that's about $5 million in revenue that can be tied to the team across the street.
As the tallest residential skyscraper in the state, Marquis will stand out as aerial cameras zoom in on the city during more than 30 nationally televised Heat games this season.
Ordover is hoping to parlay that free advertising into increased interest at the building's boutique hotel, and has placed ads in Heat game programs and the team's commemorative yearbook.
One ad for Tempo, the hotel, describes the building as "within three-point range of the arena."
Those kinds of ads will be common this season, Ordover said, as they have already shown results.
"I have a room in the hotel, because I travel back and forth. Now the hotel has so many nights of 100 percent occupancy that they're kicking me out," she said. "And it's directly correlated to the Heat games."
Out-of-town visitors searching online for the closest hotel to the arena will find Tempo listed at the top, 0.3 miles away, another marketing boost for the hotel, which opened in June. Rooms start at about $229.
The hotel has bought into the Heat mania, with player-based room specials tied to Wade, Bosh and James.
900 BISCAYNE BAY
The 900 Biscayne Bay condo tower, built in 2008, also has a large number of condos left on its rolls. The building has nearly 130 of its 509 developer units available and sold 18 units between July and September, according to data from real estate consultancy Condo Vultures.
Peter Zalewski, principal at Condo Vultures, said that with units going for $500,000 and more in buildings like 900 Biscayne Bay, the Heat effect will be limited.
"I don't think anyone is going to buy a residential property because of LeBron," he said. "But I do think that they're going to go to the bars and restaurants and get more comfortable with the area."
Owners of Miss Yip restaurant are counting on those expected bar-hoppers to help boost sales at the Chinese eatery's new downtown location at 900 Biscayne.
Shortly after the Heat play their first home game, the Chinese restaurant will open its downtown Miami branch, said Deniz Kose, the restaurant's manager. Miss Yip, a mainstay in Miami Beach since 2003, had contemplated expanding downtown long before this summer, but the Heat's revamped team was the tipping point.
"We have a lot of customers coming from downtown saying `I wish you had a location near me,' so it's the demand and supply thing," he said. "We expect to have even more people for the basketball games."
Still, the Heat effect at 900 Biscayne has been limited -- the building has a good chunk of vacant retail space near its bottom that has been for sale for more than a year.
TEN MUSEUM PARK
Ten Museum Park sold nearly all of its 200 units soon after being completed in 2007, and many boom-time investor-buyers have seen an uptick in rental interest this summer, said Shelly Abramowitz, owner of Museum Park Realty.
Those renters have helped the building reach near-full status, as they dish out $1,700 and more each month for one-bedrooms there.
The building has been a draw among the young professional crowd seeking big-city life, Abramowitz said.
"This neighborhood is spreading its wings right now by adding all these entertainment options," he said.
"That was what was missing before."
Read more: http://www.miamiherald.com/2010/10/24/v-fullstory/1889670/miami-heats-big-three-a-boon-to.html#ixzz13OqkL2DY
Friday, October 15, 2010
Robo-Signers: Mortgage Experience not Necessary - October 15, 2010
By MICHELLE CONLIN
AP Real Estate Writer
NEW YORK -- In an effort to rush through thousands of home foreclosures since 2007, financial institutions and their mortgage servicing departments hired hair stylists, Walmart floor workers and people who had worked on assembly lines and installed them in "foreclosure expert" jobs with no formal training, a Florida lawyer says.
In depositions released Tuesday, many of those workers testified that they barely knew what a mortgage was. Some couldn't define the word "affidavit." Others didn't know what a complaint was, or even what was meant by personal property. Most troubling, several said they knew they were lying when they signed the foreclosure affidavits and that they agreed with the defense lawyers' accusations about document fraud.
"The mortgage servicers hired people who would never question authority," said Peter Ticktin, a Deerfield Beach, Fla., lawyer who is defending 3,000 homeowners in foreclosure cases. As part of his work, Ticktin gathered 150 depositions from bank employees who say they signed foreclosure affidavits without reviewing the documents or ever laying eyes on them - earning them the name "robo-signers."
The deposed employees worked for the mortgage service divisions of banks such as Bank of America and JP Morgan Chase, as well as for mortgage servicers like Litton Loan Servicing, a division of Goldman Sachs.
Ticktin said he would make the testimony available to state and federal agencies that are investigating financial institutions for allegations of possible mortgage fraud. This comes on the eve of an expected announcement Wednesday from 40 state attorneys general that they will launch a collective probe into the mortgage industry.
"This was an industrywide scheme designed to defraud homeowners," Ticktin said.
The depositions paint a surreal picture of foreclosure experts who didn't understand even the most elementary aspects of the mortgage or foreclosure process - even though they were entrusted as the records custodians of homeowners' loans. In one deposition taken in Houston, a foreclosure supervisor with Litton Loan couldn't define basic terms like promissory note, mortgagee, lien, receiver, jurisdiction, circuit court, plaintiff's assignor or defendant. She testified that she didn't know why a spouse might claim interest in a property, what the required conditions were for a bank to foreclose or who the holder of the mortgage note was. "I don't know the ins and outs of the loan, I just sign documents," she said at one point.
Until now, only a handful of depositions from robo-signers have come to light. But the sheer volume of the new depositions will make it more difficult for financial institutions to argue that robo-signing was an aberrant practice in a handful of rogue back offices.
Judges are unlikely to look favorably on a bank that claims paperwork flaws don't matter because the borrower was in default on the loan, said Kendall Coffey, a former Miami U.S. attorney and author of the book "Foreclosures."
"There has to be a cornerstone of integrity to the process," Coffey said.
Bank of America responded to Tiktin's depositions by re-affirming that an internal review has shown that its foreclosures have been accurate. "This review will ensure we have a full understanding of any potential issues and quickly address them," Bank of America spokesman Dan Frahm said. Frahm added that, on average, the bank's foreclosure customers have not made a payment in more than 18 months.
JP Morgan Chase spokesman Thomas Kelly said the bank has requested that courts not enter into any judgments until the bank had reviewed its procedures. But Kelly added that the bank believes that all the underlying facts of the cases involved in the document fraud allegations are true.
Litton Loan Servicing did not respond to a request for comment.
Even before the foreclosure scandal broke, the housing market was in the midst of an ugly detoxification. Now the escalating crisis is likely to prolong the housing depression for at least another few years. The allegations are opening the entire chain of foreclosure proceedings to legal challenge. Some foreclosures could be overturned. Others could be deemed illegal.
For a housing recovery to occur, all the foreclosed properties - which could account for 40 percent of all residential sales by 2012 - need to be re-scrutinized by the banks and resold on the market. Now, with so much inventory under a legal threat, the process will become severely delayed.
"This just adds more uncertainty to the whole mortgage process, so buyers are asking themselves: do I want to buy a home in this environment?" says Cris deRitis, director of credit analytics at Moody's Analytics. "We need to fix these issues before the economy can recover."
Though some have chalked up the foreclosure debacle to an overblown case of paperwork bungling, the underlying legal issues are far more serious. Yes, swearing that you've reviewed documents you've never seen is a legal offense. But at the center of the foreclosure scandal looms something much larger: the question of who actually owns the loans and who has the right to foreclose upon them. The paperwork issues being raised by lawyers and attorneys generals have the potential to blight not just the titles of foreclosed properties but also those belonging to homeowners who have never missed a mortgage payment.
So far, JP Morgan Chase, PNC Financial and Litton Loan Servicing have stopped some foreclosure proceedings in 23 states. Bank of America and GMAC, recently renamed Ally, have extended their moratoriums to all 50 states. Wells Fargo and Citigroup have said they are continuing with foreclosures, adding that they are confident in their documents and processes.
But Citigroup has now backpedaled some on that assertion. The bank sent out a press release Tuesday that it was no longer using the law firm of "foreclosure king" David Stern, now under investigation by the Florida attorney general's office. "Pending the outcome of the AG's investigation, Citi is not referring new matters to this firm," the bank said in an e-mailed statement.
Late last week, in an interview with the Florida attorney general, a former senior paralegal in Stern's firm described a boiler-room atmosphere in which employees were pressured to forge signatures, backdate documents, swap Social Security numbers, inflate billings and pass around notary stamps as if they were salt.
Stern's lawyer, Jeffrey Tew, did not respond to a request for comment.
Meanwhile, the public outrage continues to mount. In what is perhaps a sign of things to come, a Simi Valley, Calif., couple and their nine children broke into their foreclosed home over the weekend and moved back in, according to television station KABC of Simi Valley. The couple, Jim and Danielle Earl, say they were working with the bank to catch up on payments until they discovered a $25,000 difference between what they owed and what the bank said they owed. The family was evicted from their Spanish-style two-story in July. The home has been sold, and the new owner was due to move in soon.
The Earls and their attorney now allege that they were victims of fraudulent paperwork.
Read more: http://www.miamiherald.com/2010/10/12/v-fullstory/1870177/robo-signers-mortgage-experience.html#ixzz12RQGZOm3
AP Real Estate Writer
NEW YORK -- In an effort to rush through thousands of home foreclosures since 2007, financial institutions and their mortgage servicing departments hired hair stylists, Walmart floor workers and people who had worked on assembly lines and installed them in "foreclosure expert" jobs with no formal training, a Florida lawyer says.
In depositions released Tuesday, many of those workers testified that they barely knew what a mortgage was. Some couldn't define the word "affidavit." Others didn't know what a complaint was, or even what was meant by personal property. Most troubling, several said they knew they were lying when they signed the foreclosure affidavits and that they agreed with the defense lawyers' accusations about document fraud.
"The mortgage servicers hired people who would never question authority," said Peter Ticktin, a Deerfield Beach, Fla., lawyer who is defending 3,000 homeowners in foreclosure cases. As part of his work, Ticktin gathered 150 depositions from bank employees who say they signed foreclosure affidavits without reviewing the documents or ever laying eyes on them - earning them the name "robo-signers."
The deposed employees worked for the mortgage service divisions of banks such as Bank of America and JP Morgan Chase, as well as for mortgage servicers like Litton Loan Servicing, a division of Goldman Sachs.
Ticktin said he would make the testimony available to state and federal agencies that are investigating financial institutions for allegations of possible mortgage fraud. This comes on the eve of an expected announcement Wednesday from 40 state attorneys general that they will launch a collective probe into the mortgage industry.
"This was an industrywide scheme designed to defraud homeowners," Ticktin said.
The depositions paint a surreal picture of foreclosure experts who didn't understand even the most elementary aspects of the mortgage or foreclosure process - even though they were entrusted as the records custodians of homeowners' loans. In one deposition taken in Houston, a foreclosure supervisor with Litton Loan couldn't define basic terms like promissory note, mortgagee, lien, receiver, jurisdiction, circuit court, plaintiff's assignor or defendant. She testified that she didn't know why a spouse might claim interest in a property, what the required conditions were for a bank to foreclose or who the holder of the mortgage note was. "I don't know the ins and outs of the loan, I just sign documents," she said at one point.
Until now, only a handful of depositions from robo-signers have come to light. But the sheer volume of the new depositions will make it more difficult for financial institutions to argue that robo-signing was an aberrant practice in a handful of rogue back offices.
Judges are unlikely to look favorably on a bank that claims paperwork flaws don't matter because the borrower was in default on the loan, said Kendall Coffey, a former Miami U.S. attorney and author of the book "Foreclosures."
"There has to be a cornerstone of integrity to the process," Coffey said.
Bank of America responded to Tiktin's depositions by re-affirming that an internal review has shown that its foreclosures have been accurate. "This review will ensure we have a full understanding of any potential issues and quickly address them," Bank of America spokesman Dan Frahm said. Frahm added that, on average, the bank's foreclosure customers have not made a payment in more than 18 months.
JP Morgan Chase spokesman Thomas Kelly said the bank has requested that courts not enter into any judgments until the bank had reviewed its procedures. But Kelly added that the bank believes that all the underlying facts of the cases involved in the document fraud allegations are true.
Litton Loan Servicing did not respond to a request for comment.
Even before the foreclosure scandal broke, the housing market was in the midst of an ugly detoxification. Now the escalating crisis is likely to prolong the housing depression for at least another few years. The allegations are opening the entire chain of foreclosure proceedings to legal challenge. Some foreclosures could be overturned. Others could be deemed illegal.
For a housing recovery to occur, all the foreclosed properties - which could account for 40 percent of all residential sales by 2012 - need to be re-scrutinized by the banks and resold on the market. Now, with so much inventory under a legal threat, the process will become severely delayed.
"This just adds more uncertainty to the whole mortgage process, so buyers are asking themselves: do I want to buy a home in this environment?" says Cris deRitis, director of credit analytics at Moody's Analytics. "We need to fix these issues before the economy can recover."
Though some have chalked up the foreclosure debacle to an overblown case of paperwork bungling, the underlying legal issues are far more serious. Yes, swearing that you've reviewed documents you've never seen is a legal offense. But at the center of the foreclosure scandal looms something much larger: the question of who actually owns the loans and who has the right to foreclose upon them. The paperwork issues being raised by lawyers and attorneys generals have the potential to blight not just the titles of foreclosed properties but also those belonging to homeowners who have never missed a mortgage payment.
So far, JP Morgan Chase, PNC Financial and Litton Loan Servicing have stopped some foreclosure proceedings in 23 states. Bank of America and GMAC, recently renamed Ally, have extended their moratoriums to all 50 states. Wells Fargo and Citigroup have said they are continuing with foreclosures, adding that they are confident in their documents and processes.
But Citigroup has now backpedaled some on that assertion. The bank sent out a press release Tuesday that it was no longer using the law firm of "foreclosure king" David Stern, now under investigation by the Florida attorney general's office. "Pending the outcome of the AG's investigation, Citi is not referring new matters to this firm," the bank said in an e-mailed statement.
Late last week, in an interview with the Florida attorney general, a former senior paralegal in Stern's firm described a boiler-room atmosphere in which employees were pressured to forge signatures, backdate documents, swap Social Security numbers, inflate billings and pass around notary stamps as if they were salt.
Stern's lawyer, Jeffrey Tew, did not respond to a request for comment.
Meanwhile, the public outrage continues to mount. In what is perhaps a sign of things to come, a Simi Valley, Calif., couple and their nine children broke into their foreclosed home over the weekend and moved back in, according to television station KABC of Simi Valley. The couple, Jim and Danielle Earl, say they were working with the bank to catch up on payments until they discovered a $25,000 difference between what they owed and what the bank said they owed. The family was evicted from their Spanish-style two-story in July. The home has been sold, and the new owner was due to move in soon.
The Earls and their attorney now allege that they were victims of fraudulent paperwork.
Read more: http://www.miamiherald.com/2010/10/12/v-fullstory/1870177/robo-signers-mortgage-experience.html#ixzz12RQGZOm3
Wednesday, October 6, 2010
Pending Home Sales Rise in South Florida - October 5, 2010
Miami Herald Staff and Wire Report
The number of people who signed contracts to buy homes in South Florida rose in September compared to last year, according to data released Monday by the Miami Association of Realtors.
In Miami-Dade County, pending home sales were up to 10,219 in September. That's an increase of 28.6 percent compared to the same month a year ago, and an increase of 1 percent from August. In Broward, 7,719 pending sales reflected a year-over-year increase of 7 percent, but a decrease of 1.6 percent from the previous month.
Nationwide, pending home sales also grew, but remained far below last year's pace. The weak economy and fears that prices will fall are keeping many consumers away from the housing market.
The National Association of Realtors said Monday that its seasonally adjusted index of sales agreements for previously occupied homes in August -- the most recent month available nationally -- rose 4.3 percent to a reading of 82.3. That's still more than 20 percent below the pace in the same month a year earlier.
Economists surveyed by Thomson Reuters had expected the index would rise to 81.4.
The index provides an early measurement of sales activity because there is usually a one- to two-month lag between a sales contract and a completed deal.
A reading of 100 indicates the average level of sales activity in 2001, when the index started. The reading was above that threshold from March 2003 through April 2007. It sank during the recession, only to surge above 100 a year ago when the government first offered tax incentives to spur sales. When the credits expired in April, the index sank.
"With underlying economic conditions still so weak, a robust housing recovery remains highly unlikely," Paul Dales, U.S. economist with Capital Economics, wrote in a research note.
High unemployment, weak job growth and tight credit have hurt the housing market, despite the lowest mortgage rates in decades.
Miami Herald business writer Toluse Olorunnipa contributed to this report, which was supplemented with information from The Associated Press.
Read more: http://www.miamiherald.com/2010/10/05/1857549/pending-home-sales-rise-in-south.html#ixzz11ariFb3c
The number of people who signed contracts to buy homes in South Florida rose in September compared to last year, according to data released Monday by the Miami Association of Realtors.
In Miami-Dade County, pending home sales were up to 10,219 in September. That's an increase of 28.6 percent compared to the same month a year ago, and an increase of 1 percent from August. In Broward, 7,719 pending sales reflected a year-over-year increase of 7 percent, but a decrease of 1.6 percent from the previous month.
Nationwide, pending home sales also grew, but remained far below last year's pace. The weak economy and fears that prices will fall are keeping many consumers away from the housing market.
The National Association of Realtors said Monday that its seasonally adjusted index of sales agreements for previously occupied homes in August -- the most recent month available nationally -- rose 4.3 percent to a reading of 82.3. That's still more than 20 percent below the pace in the same month a year earlier.
Economists surveyed by Thomson Reuters had expected the index would rise to 81.4.
The index provides an early measurement of sales activity because there is usually a one- to two-month lag between a sales contract and a completed deal.
A reading of 100 indicates the average level of sales activity in 2001, when the index started. The reading was above that threshold from March 2003 through April 2007. It sank during the recession, only to surge above 100 a year ago when the government first offered tax incentives to spur sales. When the credits expired in April, the index sank.
"With underlying economic conditions still so weak, a robust housing recovery remains highly unlikely," Paul Dales, U.S. economist with Capital Economics, wrote in a research note.
High unemployment, weak job growth and tight credit have hurt the housing market, despite the lowest mortgage rates in decades.
Miami Herald business writer Toluse Olorunnipa contributed to this report, which was supplemented with information from The Associated Press.
Read more: http://www.miamiherald.com/2010/10/05/1857549/pending-home-sales-rise-in-south.html#ixzz11ariFb3c
Friday, September 24, 2010
Active Miami-Dade Home-Sale Market Bucking National Trend - September 24, 2010
Year-over-year home sales were up in Miami-Dade County in August and median prices fell, opposing the dreary national picture.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Since a federal tax break expired June 30, home sales have fallen 20.9 percent in Phoenix, 32.5 percent in Las Vegas, 19.9 percent in San Diego, and even 25 percent in Austin's recession-resistant housing market.
But in Miami-Dade, which continues to battle massive amounts of foreclosures, a bloated inventory of homes and high unemployment, sales have outperformed the national market for the past two months, ignoring the post-tax credit hangover. Since June, Miami-Dade combined sales are flat, according to data from the Florida Association of Realtors.
Miami-Dade's numbers stack up well next to national numbers, an indication that falling prices and international interest in South Florida real estate are sustaining sales.
Nationally, August sales rose slightly from July's 15-year lows, but were still down 19 percent year-over-year and 22.5 percent since June, the National Association of Realtors said.
The federal homebuyer's tax credit expired in April, so most markets saw a bump in sales in May and June, as buyers closed sales before the program's original June 30 deadline.
Miami-Dade sales of existing homes, condos and townhouses increased 31.3 percent in August compared to the same month of 2009, figures released Thursday show.
The picture is not as pretty in Broward County, where year-over-year existing sales slumped 11.6 percent in August for all home types, and sales have slipped 18.7 percent since June.
Comparing South Florida to some of the headline markets in the most troubled states - Nevada, California and Arizona - gives a more nuanced picture of the factors that have distinguished the Miami area from the rest of the country.
"Miami hit its peak in the fourth quarter of 2005, the other markets didn't hit their peaks until the fourth quarter of 2007," said Peter Zalewski, a principal at Bal Harbour-based consultancy Condo Vultures.
"In Miami, the prices have been cut since 2009. If you go to Southern California, you're not going to see those price cuts yet."
As home prices rise nationally, South Florida continues to see its prices slashed, fueling the appetite of bargain-hungry international buyers and local investors.
In August, condo prices fell 28 percent to $104,800 in Miami-Dade, and single-family home prices fell 6 percent to $182,900. In a lending environment where many struggle to obtain loans for the discounted properties, cash-wielding investors have ramped up their activity, propping up sales.
MIAMI VS. LAS VEGAS
Las Vegas, by many measures, is the housing market most similar to South Florida. Its second-home purchasers and retirees, tourism-fueled economy, and federally-protected land boundaries all mirror South Florida, which has a limited supply of land because it's sandwiched between the Atlantic Ocean and the Everglades.
Like Miami, Las Vegas went through a housing boom cycle of giant proportions, as a rush of developers built up the area. When the economy tanked, foreclosures, stalled projects and short sales became the norm.
The region appears to have relied more on the federal tax credit for its housing recovery than South Florida.
Las Vegas existing sales drooped 18.5 percent in July, and 9.7 percent in August compared to those same months last year.
Low prices in Sin City have also sparked investor activity -- a median priced condo costs $68,000 in Las Vegas -- but those investors have not been as aggressive as they have been in Miami. For one, the international investors that have propped up South Florida's market have been far less active in Las Vegas.
Only about 4 percent of the country's international buyers purchase in Nevada, according to a report by the National Association of Realtors. In Florida, which has the nation's largest crop of international home buyers, that figure is 22 percent. And a large chunk of them are buying in the Miami area, said Oliver Ruiz, residential president of the Miami Association of Realtors.
"We continue to see strong demand from international buyers in all price points, including the high-end market," he said in a statement.
"These buyers are willing to outbid competing offers and are 89 percent cash, a factor that automatically expedites their transactions."
MIAMI VS. PHOENIX
Like Florida, Arizona ranks consistently among the top five states for foreclosure activity, in the aftermath of mid-decade exotic mortgage loans and speculator activity.
Home prices doubled in Phoenix between 2002 and 2006, and the ensuing crash was just as extreme, leaving two-thirds of homeowners underwater, according to the real estate firm Zillow.
Like Miami, Phoenix's condo market continues to see prices slashed -- the median was down 33 percent in August to $70,000 -- and investors have shown up to cash in on low prices. All-cash buyers made up 42 percent of Phoenix home sales last month, according to Dataquick, a real estate information firm. But Phoenix's inventory of condos pales in comparison to Miami, where a building boom created more than 20,000 units in five years.
Phoenix has one condo listed for sale for every five houses while Miami-Dade has nearly twice as many condos for sale as single-family homes. The remaining 16,000-unit inventory in Miami has helped push prices down more than 40 percent since 2008.
Investors have scooped these condos up at a fast clip, sometimes buying in bulk, and hoping to capitalize on the rental market in the short term.
In August, Miami-Dade condo sales anchored the rising sales numbers, as 857 condo purchases represented an increase of 51 percent from last August. However, drooping prices couldn't sustain sales in Broward, where August saw median prices fall 14 percent to $73,300. Sales there dropped 7 percent to 818.
MIAMI VS. SAN DIEGO
San Diego was also a leading victim of the housing crash, but home prices have already begun to rebound there, as they have throughout California for the past two years. The median San Diego home sold for $338,000 in August, compared to just $280,000 in January last year, a sign its market may have hit already its nadir.
Bargain hunters in South Florida still have hope for market-bottom prices, as August figures showed prices falling across the board. Median prices for single-family homes fell a further 6 percent to $182,000 in August compared to the same month last year.
Evan Goldman, a local Realtor and member of the Master Brokers Forum, bought a five-bedroom home in Pinecrest in August, after the price was slashed from the mid-$700s to $629,000.
"I really saw prices going down and down, and from my standpoint I felt as if they were bottoming out," he said.
MIAMI VS. AUSTIN
Miami's August sales report even bests cities like Austin, Texas, which is considered one of the country's most stable housing markets. The region dodged the boom-bust cycle and the city has a 7.2 percent unemployment rate, compared to Miami-Dade's 12.7 percent rate.
But in the post-tax credit market, Miami can claim supremacy over Austin in the home sales arena. Austin sales were down 15 percent year-over-year in August, while Miami-Dade sales jumped by a third.
Likewise, Miami-Dade outperformed Portland, Ore., Des Moines, Iowa, Los Angeles, Denver and many other markets in August sales.
Rochelle Oliver, 26, who recently put an offer in on a three-bedroom house in Miami Beach, believes now is a good time to make her first home purchase.
The house was a bargain, but she faces competition.
"Someone else has put an offer on it - higher than my offer," she said. "I'm waiting to hear back. Hopefully their deal doesn't go through."
Read more: http://www.miamiherald.com/2010/09/24/v-fullstory/1839897/active-miami-dade-home-sale-market.html#ixzz10UW3pWXW
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Since a federal tax break expired June 30, home sales have fallen 20.9 percent in Phoenix, 32.5 percent in Las Vegas, 19.9 percent in San Diego, and even 25 percent in Austin's recession-resistant housing market.
But in Miami-Dade, which continues to battle massive amounts of foreclosures, a bloated inventory of homes and high unemployment, sales have outperformed the national market for the past two months, ignoring the post-tax credit hangover. Since June, Miami-Dade combined sales are flat, according to data from the Florida Association of Realtors.
Miami-Dade's numbers stack up well next to national numbers, an indication that falling prices and international interest in South Florida real estate are sustaining sales.
Nationally, August sales rose slightly from July's 15-year lows, but were still down 19 percent year-over-year and 22.5 percent since June, the National Association of Realtors said.
The federal homebuyer's tax credit expired in April, so most markets saw a bump in sales in May and June, as buyers closed sales before the program's original June 30 deadline.
Miami-Dade sales of existing homes, condos and townhouses increased 31.3 percent in August compared to the same month of 2009, figures released Thursday show.
The picture is not as pretty in Broward County, where year-over-year existing sales slumped 11.6 percent in August for all home types, and sales have slipped 18.7 percent since June.
Comparing South Florida to some of the headline markets in the most troubled states - Nevada, California and Arizona - gives a more nuanced picture of the factors that have distinguished the Miami area from the rest of the country.
"Miami hit its peak in the fourth quarter of 2005, the other markets didn't hit their peaks until the fourth quarter of 2007," said Peter Zalewski, a principal at Bal Harbour-based consultancy Condo Vultures.
"In Miami, the prices have been cut since 2009. If you go to Southern California, you're not going to see those price cuts yet."
As home prices rise nationally, South Florida continues to see its prices slashed, fueling the appetite of bargain-hungry international buyers and local investors.
In August, condo prices fell 28 percent to $104,800 in Miami-Dade, and single-family home prices fell 6 percent to $182,900. In a lending environment where many struggle to obtain loans for the discounted properties, cash-wielding investors have ramped up their activity, propping up sales.
MIAMI VS. LAS VEGAS
Las Vegas, by many measures, is the housing market most similar to South Florida. Its second-home purchasers and retirees, tourism-fueled economy, and federally-protected land boundaries all mirror South Florida, which has a limited supply of land because it's sandwiched between the Atlantic Ocean and the Everglades.
Like Miami, Las Vegas went through a housing boom cycle of giant proportions, as a rush of developers built up the area. When the economy tanked, foreclosures, stalled projects and short sales became the norm.
The region appears to have relied more on the federal tax credit for its housing recovery than South Florida.
Las Vegas existing sales drooped 18.5 percent in July, and 9.7 percent in August compared to those same months last year.
Low prices in Sin City have also sparked investor activity -- a median priced condo costs $68,000 in Las Vegas -- but those investors have not been as aggressive as they have been in Miami. For one, the international investors that have propped up South Florida's market have been far less active in Las Vegas.
Only about 4 percent of the country's international buyers purchase in Nevada, according to a report by the National Association of Realtors. In Florida, which has the nation's largest crop of international home buyers, that figure is 22 percent. And a large chunk of them are buying in the Miami area, said Oliver Ruiz, residential president of the Miami Association of Realtors.
"We continue to see strong demand from international buyers in all price points, including the high-end market," he said in a statement.
"These buyers are willing to outbid competing offers and are 89 percent cash, a factor that automatically expedites their transactions."
MIAMI VS. PHOENIX
Like Florida, Arizona ranks consistently among the top five states for foreclosure activity, in the aftermath of mid-decade exotic mortgage loans and speculator activity.
Home prices doubled in Phoenix between 2002 and 2006, and the ensuing crash was just as extreme, leaving two-thirds of homeowners underwater, according to the real estate firm Zillow.
Like Miami, Phoenix's condo market continues to see prices slashed -- the median was down 33 percent in August to $70,000 -- and investors have shown up to cash in on low prices. All-cash buyers made up 42 percent of Phoenix home sales last month, according to Dataquick, a real estate information firm. But Phoenix's inventory of condos pales in comparison to Miami, where a building boom created more than 20,000 units in five years.
Phoenix has one condo listed for sale for every five houses while Miami-Dade has nearly twice as many condos for sale as single-family homes. The remaining 16,000-unit inventory in Miami has helped push prices down more than 40 percent since 2008.
Investors have scooped these condos up at a fast clip, sometimes buying in bulk, and hoping to capitalize on the rental market in the short term.
In August, Miami-Dade condo sales anchored the rising sales numbers, as 857 condo purchases represented an increase of 51 percent from last August. However, drooping prices couldn't sustain sales in Broward, where August saw median prices fall 14 percent to $73,300. Sales there dropped 7 percent to 818.
MIAMI VS. SAN DIEGO
San Diego was also a leading victim of the housing crash, but home prices have already begun to rebound there, as they have throughout California for the past two years. The median San Diego home sold for $338,000 in August, compared to just $280,000 in January last year, a sign its market may have hit already its nadir.
Bargain hunters in South Florida still have hope for market-bottom prices, as August figures showed prices falling across the board. Median prices for single-family homes fell a further 6 percent to $182,000 in August compared to the same month last year.
Evan Goldman, a local Realtor and member of the Master Brokers Forum, bought a five-bedroom home in Pinecrest in August, after the price was slashed from the mid-$700s to $629,000.
"I really saw prices going down and down, and from my standpoint I felt as if they were bottoming out," he said.
MIAMI VS. AUSTIN
Miami's August sales report even bests cities like Austin, Texas, which is considered one of the country's most stable housing markets. The region dodged the boom-bust cycle and the city has a 7.2 percent unemployment rate, compared to Miami-Dade's 12.7 percent rate.
But in the post-tax credit market, Miami can claim supremacy over Austin in the home sales arena. Austin sales were down 15 percent year-over-year in August, while Miami-Dade sales jumped by a third.
Likewise, Miami-Dade outperformed Portland, Ore., Des Moines, Iowa, Los Angeles, Denver and many other markets in August sales.
Rochelle Oliver, 26, who recently put an offer in on a three-bedroom house in Miami Beach, believes now is a good time to make her first home purchase.
The house was a bargain, but she faces competition.
"Someone else has put an offer on it - higher than my offer," she said. "I'm waiting to hear back. Hopefully their deal doesn't go through."
Read more: http://www.miamiherald.com/2010/09/24/v-fullstory/1839897/active-miami-dade-home-sale-market.html#ixzz10UW3pWXW
Friday, September 17, 2010
4 Real Estate Lessons from a 97-Year-Old - September 17, 2010
More than 7 decades in the business have given him wisdom; he shares a few gems.
By John Roach of SwitchYard Media
Buy a house today if you can, but don't sell one if you don't have to, says George W. Johnson, a 97-year-old real-estate agent who has been working the Seattle market since 1936.
Johnson, who is reluctant to call himself America's oldest real-estate agent — he says he just learned of a 99-year-old broker in Florida — has seen his share of housing booms and busts since he hung his first real-estate shingle 74 years ago.
"I've been through a lot of these ups and downs," he says, remembering the property boom that followed World War II, as well as the deep downturn in the 1970s when Seattle's biggest employer, Boeing, laid off thousands of workers.
Through it all, Johnson says he has learned many enduring lessons. Chief among them: After every housing recession, the market has "gone higher than the one before." You have to have the stomach to hang on through all of the twists and turns, he says.
This market a 'baby' compared to days past
Johnson wasn't always a real-estate guy. He was born to a farming family in South Dakota on Dec. 22, 1912, and moved to Seattle at the height of the Great Depression to attend college and pursue a teaching career. To make ends meet, Johnson juggled three jobs at one time. He delivered milk for a while. "Whatever you could do to get by with, you did it."
Then, in 1936, he started dabbling in real estate. Unemployment hovered around 30%, soup lines stretched around blocks, homelessness was rampant.
"You could have bought the best house in (the Seattle neighborhood of) Ballard for $3,500." Times were tough. The current real-estate market, Johnson says, is "a baby" by comparison.
"In addition to the Depression, we had the drought at the same period, so it was just compounded. You wouldn't believe the things that happened during that period."
Johnson, a natty dresser who drives himself to work every day — including Saturdays – managed to carve out a niche as a service-oriented agent. When the economy turned at the end of World War II, he opened up his own shop in Ballard, north of downtown. He and his sons have run George W. Johnson Realtors ever since, weathering the ups and downs in the market with confidence that profits are there for the making.
"I've lost a lot of money in a lot of things, but I've never lost in real estate," Johnson says. He remembers selling his first house in the 1930s for about $1,500. "It's probably worth $300,000 now."
4 real-estate tips from Johnson
You can't thrive in the real-estate industry for this long without learning some useful lessons along the way. Here are some of Johnson's pearls of wisdom:
Beware one-company towns: Cities dependent on a single company or industry are more vulnerable to jarring downturns if the economy goes south. The Rust Belt's old factory towns have made that abundantly clear.
The Seattle market turned particularly grim in the late 1960s and early '70s when Boeing, the aerospace giant, laid off more than 60,000 people in the Seattle area. "Boeing was about the only major company we had other than (the University of Washington)," he recalls. "Now we've got a much broader base to help out … it is altogether a different proposition."
Johnson counsels homebuyers to look beyond real-estate values and investigate an area's fundamental economy before making a purchase.
Don't get greedy. Johnson blames "plain old greed" for the latest real-estate downturn — people got caught up in the enthusiasm of the moment and banks egged them on with cheap loans.
"Everybody was out to buy a house, raise the price, double it and make a quick buck," he says, shaking his head. "People signed up for stuff that they knew they shouldn't have and they couldn't pay (for) and of course the banks helped them."
Johnson is old-school in that way. At the heart of his real-estate philosophy is his fundamental belief in personal responsibility. "You've got to be able to hang onto a house until conditions are such that you can make a little money," he says, emphasizing that each and every potential homebuyer should make an honest assessment of his or her financial potential and should be wary of offers that seem too good to be true.
"People aren't as dumb as the media is making them out to be. They knew what they were getting into," he says.
But he is compassionate for those who have run into honest trouble. "It's tough on people who lost their jobs and are now losing their homes and that type of thing. It always is," he says.
Their pain, however, is the buyers' gain.
Timing is everything. "In this market, any young person that hasn't bought a house ought to buy one," Johnson says. "A buyers market doesn't come along that often … you just can hardly help but make money on whatever you buy today at the prices they are."
Johnson says rates are only going to go up over the long term, so borrowing will cost more.
If you don't have to sell, hang on. Unfortunately, Johnson expects sellers to continue to suffer, at least for now. Buyers, on the other hand, "know it's a buyers market – they are going to come in with offers below what we've appraised it at just because they know a lot of people have to sell," he says.
Despite the continued housing-market struggles, Johnson is confident that the latest downtrend is largely over. "We are headed up," he says, "but like I said, I think it is going to be slow. It will take a year or two at least."
And as the market heads up, Johnson hopes to be there helping his customers buy and sell homes just as he has for most of his life – out of a small, family office dedicated to service with a smile.
"We've done a good job," he says of his business. "We've been careful and honest and thorough and it's been good service, and I think that will always produce, no matter what business you're in."
http://realestate.msn.com/article.aspx?cp-documentid=25369084>1=35006
By John Roach of SwitchYard Media
Buy a house today if you can, but don't sell one if you don't have to, says George W. Johnson, a 97-year-old real-estate agent who has been working the Seattle market since 1936.
Johnson, who is reluctant to call himself America's oldest real-estate agent — he says he just learned of a 99-year-old broker in Florida — has seen his share of housing booms and busts since he hung his first real-estate shingle 74 years ago.
"I've been through a lot of these ups and downs," he says, remembering the property boom that followed World War II, as well as the deep downturn in the 1970s when Seattle's biggest employer, Boeing, laid off thousands of workers.
Through it all, Johnson says he has learned many enduring lessons. Chief among them: After every housing recession, the market has "gone higher than the one before." You have to have the stomach to hang on through all of the twists and turns, he says.
This market a 'baby' compared to days past
Johnson wasn't always a real-estate guy. He was born to a farming family in South Dakota on Dec. 22, 1912, and moved to Seattle at the height of the Great Depression to attend college and pursue a teaching career. To make ends meet, Johnson juggled three jobs at one time. He delivered milk for a while. "Whatever you could do to get by with, you did it."
Then, in 1936, he started dabbling in real estate. Unemployment hovered around 30%, soup lines stretched around blocks, homelessness was rampant.
"You could have bought the best house in (the Seattle neighborhood of) Ballard for $3,500." Times were tough. The current real-estate market, Johnson says, is "a baby" by comparison.
"In addition to the Depression, we had the drought at the same period, so it was just compounded. You wouldn't believe the things that happened during that period."
Johnson, a natty dresser who drives himself to work every day — including Saturdays – managed to carve out a niche as a service-oriented agent. When the economy turned at the end of World War II, he opened up his own shop in Ballard, north of downtown. He and his sons have run George W. Johnson Realtors ever since, weathering the ups and downs in the market with confidence that profits are there for the making.
"I've lost a lot of money in a lot of things, but I've never lost in real estate," Johnson says. He remembers selling his first house in the 1930s for about $1,500. "It's probably worth $300,000 now."
4 real-estate tips from Johnson
You can't thrive in the real-estate industry for this long without learning some useful lessons along the way. Here are some of Johnson's pearls of wisdom:
Beware one-company towns: Cities dependent on a single company or industry are more vulnerable to jarring downturns if the economy goes south. The Rust Belt's old factory towns have made that abundantly clear.
The Seattle market turned particularly grim in the late 1960s and early '70s when Boeing, the aerospace giant, laid off more than 60,000 people in the Seattle area. "Boeing was about the only major company we had other than (the University of Washington)," he recalls. "Now we've got a much broader base to help out … it is altogether a different proposition."
Johnson counsels homebuyers to look beyond real-estate values and investigate an area's fundamental economy before making a purchase.
Don't get greedy. Johnson blames "plain old greed" for the latest real-estate downturn — people got caught up in the enthusiasm of the moment and banks egged them on with cheap loans.
"Everybody was out to buy a house, raise the price, double it and make a quick buck," he says, shaking his head. "People signed up for stuff that they knew they shouldn't have and they couldn't pay (for) and of course the banks helped them."
Johnson is old-school in that way. At the heart of his real-estate philosophy is his fundamental belief in personal responsibility. "You've got to be able to hang onto a house until conditions are such that you can make a little money," he says, emphasizing that each and every potential homebuyer should make an honest assessment of his or her financial potential and should be wary of offers that seem too good to be true.
"People aren't as dumb as the media is making them out to be. They knew what they were getting into," he says.
But he is compassionate for those who have run into honest trouble. "It's tough on people who lost their jobs and are now losing their homes and that type of thing. It always is," he says.
Their pain, however, is the buyers' gain.
Timing is everything. "In this market, any young person that hasn't bought a house ought to buy one," Johnson says. "A buyers market doesn't come along that often … you just can hardly help but make money on whatever you buy today at the prices they are."
Johnson says rates are only going to go up over the long term, so borrowing will cost more.
If you don't have to sell, hang on. Unfortunately, Johnson expects sellers to continue to suffer, at least for now. Buyers, on the other hand, "know it's a buyers market – they are going to come in with offers below what we've appraised it at just because they know a lot of people have to sell," he says.
Despite the continued housing-market struggles, Johnson is confident that the latest downtrend is largely over. "We are headed up," he says, "but like I said, I think it is going to be slow. It will take a year or two at least."
And as the market heads up, Johnson hopes to be there helping his customers buy and sell homes just as he has for most of his life – out of a small, family office dedicated to service with a smile.
"We've done a good job," he says of his business. "We've been careful and honest and thorough and it's been good service, and I think that will always produce, no matter what business you're in."
http://realestate.msn.com/article.aspx?cp-documentid=25369084>1=35006
Wednesday, September 15, 2010
Gov't: Banks should share Fannie, Freddie costs - September 15, 2010
By ALAN ZIBEL
AP Real Estate Writer
WASHINGTON -- The nation's largest banks have an obligation to pay some of the cost for bailing out mortgage buyers Fannie Mae and Freddie Mac because they sold them bad mortgages, a government regulator said Wednesday.
Edward DeMarco, the acting director for the Federal Housing Finance Agency, said the banks this summer have refused to take back $11 billion in bad loans sold to the two government-controlled companies, in written testimony submitted for a House subcommittee hearing Wednesday. A third of those requests have been outstanding for at least three months.
DeMarco said the banks have a legal obligation to buy back the loans and called the delays "a significant concern." He said the government may take new steps to force those buybacks if "discussions do not yield reasonable outcomes soon."
In an interview with reporters after the hearing, DeMarco declined to give further details on what the government might do next. He said only that "we're looking for contractual obligations to be fulfilled."
Fannie and Freddie buy mortgages and package them into securities with a guarantee against default.
The two mortgage giants nearly collapsed two years ago when the housing market went bust. The government stepped in to rescue them and it has cost taxpayers about $148 billion so far. The rescue is on track to be the most expensive piece of stabilizing the financial system.
Fannie and Freddie have a legal right to return bad loans, especially if they later discover fraudulent statements on applications. Any money they recover offsets their losses.
The amount in question is a small fraction of the total government rescue, said Ed Mills, financial policy analyst at FBR Capital Markets.
Still, lenders say Fannie and Freddie are trying to return too many loans. And in some cases, they are pushing back loans where it's not clear fraud was committed, the lenders say.
Mortgage industry consultant Brian Chappelle said the requests often apply to loans that met the mortgage buyers' guidelines at the time.
"The industry believes that the pendulum has swung far beyond what is reasonable," he said. As a result, he said, lenders are being extremely cautious about making new loans.
Wall Street has worried that the costs of bailing out Fannie and Freddie could get pushed back on big banks. Fitch Ratings said in a report last month that the four largest U.S. banks could book losses of up to $42 billion if Fannie Mae and Freddie Mac force them to take back troubled mortgages they made. It also estimated that JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Wells Fargo & Co. could record $17 billion in losses if they repurchase a quarter of the mortgage giants' seriously delinquent loans.
The leading Democrat on the panel, a House Financial Services subcommittee, indicated the banks bear some responsibility.
"We must begin to think about approaches for recouping taxpayers' money in the long run," said Rep. Paul Kanjorski. "We found a way to pay for the savings and loan crisis, and we can survey find a way to recover the costs associated with this crisis."
A bigger headache for lawmakers is figuring out what to do with Fannie and Freddie in the future.
The Obama administration is working on a plan to restructure the mortgage market and make sure home loans are affordable. Officials don't plan to release details until next year. But Michael Barr, an assistant Treasury secretary, told the panel Wednesday that Fannie and Freddie "will not exist in the same form as they did in the past."
Sorting out the future of housing finance has been a divisive issue on Capitol Hill. And it could grow even more contentious if Republicans take control of one or both houses of Congress.
Republicans have seized on the administration's management of Fannie and Freddie to illustrate Democrats' push for broadening the reach of the federal government. They say loans acquired by Fannie and Freddie since the September 2008 takeover have put taxpayers at risk.
"It's time for the government to get out of that business," said Rep. Spencer Bachus, the top Republican on the House Financial Services Committee.
But Democrats and regulators say the loans acquired by Fannie and Freddie before their takeover represent the overwhelming majority of the companies' losses. New loans acquired since then have been performing well, they note.
"There is no urgency," to reform the two companies, said Rep. Barney Frank, the committee's chairman. "The pattern of abuse they had engaged in has been changed...Fannie and Freddie are behaving differently and are causing far less problems."
Read more: http://www.miamiherald.com/2010/09/15/1825791/regulator-says-banks-slow-to-buy.html#ixzz0zdspZU9I
AP Real Estate Writer
WASHINGTON -- The nation's largest banks have an obligation to pay some of the cost for bailing out mortgage buyers Fannie Mae and Freddie Mac because they sold them bad mortgages, a government regulator said Wednesday.
Edward DeMarco, the acting director for the Federal Housing Finance Agency, said the banks this summer have refused to take back $11 billion in bad loans sold to the two government-controlled companies, in written testimony submitted for a House subcommittee hearing Wednesday. A third of those requests have been outstanding for at least three months.
DeMarco said the banks have a legal obligation to buy back the loans and called the delays "a significant concern." He said the government may take new steps to force those buybacks if "discussions do not yield reasonable outcomes soon."
In an interview with reporters after the hearing, DeMarco declined to give further details on what the government might do next. He said only that "we're looking for contractual obligations to be fulfilled."
Fannie and Freddie buy mortgages and package them into securities with a guarantee against default.
The two mortgage giants nearly collapsed two years ago when the housing market went bust. The government stepped in to rescue them and it has cost taxpayers about $148 billion so far. The rescue is on track to be the most expensive piece of stabilizing the financial system.
Fannie and Freddie have a legal right to return bad loans, especially if they later discover fraudulent statements on applications. Any money they recover offsets their losses.
The amount in question is a small fraction of the total government rescue, said Ed Mills, financial policy analyst at FBR Capital Markets.
Still, lenders say Fannie and Freddie are trying to return too many loans. And in some cases, they are pushing back loans where it's not clear fraud was committed, the lenders say.
Mortgage industry consultant Brian Chappelle said the requests often apply to loans that met the mortgage buyers' guidelines at the time.
"The industry believes that the pendulum has swung far beyond what is reasonable," he said. As a result, he said, lenders are being extremely cautious about making new loans.
Wall Street has worried that the costs of bailing out Fannie and Freddie could get pushed back on big banks. Fitch Ratings said in a report last month that the four largest U.S. banks could book losses of up to $42 billion if Fannie Mae and Freddie Mac force them to take back troubled mortgages they made. It also estimated that JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Wells Fargo & Co. could record $17 billion in losses if they repurchase a quarter of the mortgage giants' seriously delinquent loans.
The leading Democrat on the panel, a House Financial Services subcommittee, indicated the banks bear some responsibility.
"We must begin to think about approaches for recouping taxpayers' money in the long run," said Rep. Paul Kanjorski. "We found a way to pay for the savings and loan crisis, and we can survey find a way to recover the costs associated with this crisis."
A bigger headache for lawmakers is figuring out what to do with Fannie and Freddie in the future.
The Obama administration is working on a plan to restructure the mortgage market and make sure home loans are affordable. Officials don't plan to release details until next year. But Michael Barr, an assistant Treasury secretary, told the panel Wednesday that Fannie and Freddie "will not exist in the same form as they did in the past."
Sorting out the future of housing finance has been a divisive issue on Capitol Hill. And it could grow even more contentious if Republicans take control of one or both houses of Congress.
Republicans have seized on the administration's management of Fannie and Freddie to illustrate Democrats' push for broadening the reach of the federal government. They say loans acquired by Fannie and Freddie since the September 2008 takeover have put taxpayers at risk.
"It's time for the government to get out of that business," said Rep. Spencer Bachus, the top Republican on the House Financial Services Committee.
But Democrats and regulators say the loans acquired by Fannie and Freddie before their takeover represent the overwhelming majority of the companies' losses. New loans acquired since then have been performing well, they note.
"There is no urgency," to reform the two companies, said Rep. Barney Frank, the committee's chairman. "The pattern of abuse they had engaged in has been changed...Fannie and Freddie are behaving differently and are causing far less problems."
Read more: http://www.miamiherald.com/2010/09/15/1825791/regulator-says-banks-slow-to-buy.html#ixzz0zdspZU9I
Friday, August 20, 2010
Property tax news unlikely to be happy for South Floridians - August 20, 2010
Expect deflated property values, rising tax rates and thousands of residents looking to challenge their home's official appraisal as property tax notices land in mailboxes this month.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Home values are still looking for a bottom, and county appraisers are still trying to get to the bottom of last year's giant pile of property assessment appeals, so it's expected to be a long property tax season in South Florida.
More than 1.75 million local homeowners should receive their 2010 property tax notices in the mail by the end of the month and, if the last two years are any indication, at least one in 10 will disagree with the number they see on the line next to the words "assessed value."
Broward County started sending tax notices on Friday and Miami-Dade letters will be sent out on Aug. 24.
Falling for the third straight year, property values in Miami-Dade County have decreased an additional 13.4 percent, or $29 billion, since last year, according to the property appraiser.
"This is the biggest drop we have seen in value in Dade County in I'm not sure how long -- definitely more than 35 years," said Miami-Dade Property Appraiser Pedro Garcia.
With foreclosures and short sales dragging down the market, some homeowners will see the silver lining of a battered market in a lower tax assessment, but many will be surprised that their tax bills haven't fallen as quickly as their home values.
Part of the reason is that governments have hiked the amounts of tax charged per each $1,000 in property value to make up for huge budget holes that have plagued cities, counties and special taxing districts during the economic downturn.
In Miami-Dade County, where commissioners are staring at a revenue hole of more than $400 million, the preliminary tax rate was upped 12 percent in July. That rate set a ceiling for how high the actual number -- to be determined by Oct. 1 -- can be. In Broward, were home values dropped 11.7 percent last year, the county commission is also weighing increases. School boards and many municipalities have indicated they would push up their rates as well.
For some homeowners, an unfortunate side effect of the 1992 Save Our Homes law could cause their tax assessments to increase even as their property values fall. Buyers who purchased before the boom benefited from an SOH clause that capped assessment increases at 3 percent a year, even as property values soared all around them. But that same law says yearly assessments must continue to increase until they are equal to market value, meaning many pre-bubble buyers will face increases until their assessed values catch up to the market.
Add increased rates with the Save Our Homes provision and many long-homesteaded property owners can expect a larger tax bill this year, despite the economic downturn that has sent wages and home values in a downward direction.
Marcos Sendon, who has owned his home in Kendall for more than 10 years, said he feels like he's being penalized for being a responsible homeowner, not involved in the subprime mortgage debacle or foreclosure crisis of the last five years.
"If you've played it straight and played by the rules, now you're going to be punished for that," he said, criticizing the county government for increasing the tax rate. "We think that's outrageous."
Sendon, editor of a conservative blog, is organizing a tea party rally to protest the local government's property tax rate increases. Public hearings in September will likely feature some level of public backlash, as city and county officials in Miami-Dade and Broward settle on tax rates and hash out budgets.
Thousands more may protest what appraisers have said their homes are worth.
If you're in that position, you'll have 25 days to file an appeal with the county property appraiser's office, for $15, and then wait patiently to be called. In Miami-Dade County, appeals to 2008 appraisals were so abundant that it took until April 2010 to finish reviewing petitions. The county's value adjustment board only recently began 2009's pile of 140,000 petitions, and despite opening up extra rooms to accommodate more hearings, the coming deluge of 2010 appeals probably won't be handled until next year.
If your appeal is rejected and you haven't paid your bill, you will be responsible for any penalties and fines that may have accrued during the appeals process.
M.J. Stone, a property tax consultant in Fort Lauderdale, said she expects this year to be as busy as ever with assessment appeals.
"With the Internet now, it's pretty easy for people to file on their own," she said. "I always tell people nobody knows their property better than the property owner. If they feel that their [assessment] is too high, this is the way to challenge that."
Broward County officials are encouraging those who dispute assessments to come in and speak with a county appraiser about their property before filing a petition, said Bob Wolfe, a spokesman for the property appraiser's office. That office is opening for extra hours on weekdays between Sept. 7 and Sept. 20, and on two Saturdays during the appeal season.
In Miami-Dade, the property appraiser has doubled the number of offices and hired additional staff this year to deal with the expected flood of appeals. The value adjustment board, which is tasked with hearing the appeals, is also hoping more people will choose to file online, and cut down the long lines that form in the last days before the Sept 20 application deadline.
One of the things to keep in mind is that 2010 property assessments reflect property values as of Jan. 1 and real estate activity from 2009. Most reports show local home values have fallen further in 2010 -- but those declines won't be reflected on your tax bill until next year.
Another point property appraisers are pushing: If you're unhappy about the tax rate set by your local government, the value adjustment board cannot help you.
Petitions to the property appraiser are only for those who believe their homes have been overvalued, Garcia said.
With home values diving as much as 31 percent year-over-year in places like Homestead, and with more and more residents struggling to pay the bills, the rush to appeal property tax charges is likely to be as high as ever.
"Our office, we're geared up," Wolfe said.
"Most of us have gone through this many times. It's all hands on deck, everybody answers the phone, everybody helps."
Read more: http://www.miamiherald.com/2010/08/15/v-fullstory/1777736/tax-news-unlikely-to-be-happy.html#ixzz0x9uRwQhq
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Home values are still looking for a bottom, and county appraisers are still trying to get to the bottom of last year's giant pile of property assessment appeals, so it's expected to be a long property tax season in South Florida.
More than 1.75 million local homeowners should receive their 2010 property tax notices in the mail by the end of the month and, if the last two years are any indication, at least one in 10 will disagree with the number they see on the line next to the words "assessed value."
Broward County started sending tax notices on Friday and Miami-Dade letters will be sent out on Aug. 24.
Falling for the third straight year, property values in Miami-Dade County have decreased an additional 13.4 percent, or $29 billion, since last year, according to the property appraiser.
"This is the biggest drop we have seen in value in Dade County in I'm not sure how long -- definitely more than 35 years," said Miami-Dade Property Appraiser Pedro Garcia.
With foreclosures and short sales dragging down the market, some homeowners will see the silver lining of a battered market in a lower tax assessment, but many will be surprised that their tax bills haven't fallen as quickly as their home values.
Part of the reason is that governments have hiked the amounts of tax charged per each $1,000 in property value to make up for huge budget holes that have plagued cities, counties and special taxing districts during the economic downturn.
In Miami-Dade County, where commissioners are staring at a revenue hole of more than $400 million, the preliminary tax rate was upped 12 percent in July. That rate set a ceiling for how high the actual number -- to be determined by Oct. 1 -- can be. In Broward, were home values dropped 11.7 percent last year, the county commission is also weighing increases. School boards and many municipalities have indicated they would push up their rates as well.
For some homeowners, an unfortunate side effect of the 1992 Save Our Homes law could cause their tax assessments to increase even as their property values fall. Buyers who purchased before the boom benefited from an SOH clause that capped assessment increases at 3 percent a year, even as property values soared all around them. But that same law says yearly assessments must continue to increase until they are equal to market value, meaning many pre-bubble buyers will face increases until their assessed values catch up to the market.
Add increased rates with the Save Our Homes provision and many long-homesteaded property owners can expect a larger tax bill this year, despite the economic downturn that has sent wages and home values in a downward direction.
Marcos Sendon, who has owned his home in Kendall for more than 10 years, said he feels like he's being penalized for being a responsible homeowner, not involved in the subprime mortgage debacle or foreclosure crisis of the last five years.
"If you've played it straight and played by the rules, now you're going to be punished for that," he said, criticizing the county government for increasing the tax rate. "We think that's outrageous."
Sendon, editor of a conservative blog, is organizing a tea party rally to protest the local government's property tax rate increases. Public hearings in September will likely feature some level of public backlash, as city and county officials in Miami-Dade and Broward settle on tax rates and hash out budgets.
Thousands more may protest what appraisers have said their homes are worth.
If you're in that position, you'll have 25 days to file an appeal with the county property appraiser's office, for $15, and then wait patiently to be called. In Miami-Dade County, appeals to 2008 appraisals were so abundant that it took until April 2010 to finish reviewing petitions. The county's value adjustment board only recently began 2009's pile of 140,000 petitions, and despite opening up extra rooms to accommodate more hearings, the coming deluge of 2010 appeals probably won't be handled until next year.
If your appeal is rejected and you haven't paid your bill, you will be responsible for any penalties and fines that may have accrued during the appeals process.
M.J. Stone, a property tax consultant in Fort Lauderdale, said she expects this year to be as busy as ever with assessment appeals.
"With the Internet now, it's pretty easy for people to file on their own," she said. "I always tell people nobody knows their property better than the property owner. If they feel that their [assessment] is too high, this is the way to challenge that."
Broward County officials are encouraging those who dispute assessments to come in and speak with a county appraiser about their property before filing a petition, said Bob Wolfe, a spokesman for the property appraiser's office. That office is opening for extra hours on weekdays between Sept. 7 and Sept. 20, and on two Saturdays during the appeal season.
In Miami-Dade, the property appraiser has doubled the number of offices and hired additional staff this year to deal with the expected flood of appeals. The value adjustment board, which is tasked with hearing the appeals, is also hoping more people will choose to file online, and cut down the long lines that form in the last days before the Sept 20 application deadline.
One of the things to keep in mind is that 2010 property assessments reflect property values as of Jan. 1 and real estate activity from 2009. Most reports show local home values have fallen further in 2010 -- but those declines won't be reflected on your tax bill until next year.
Another point property appraisers are pushing: If you're unhappy about the tax rate set by your local government, the value adjustment board cannot help you.
Petitions to the property appraiser are only for those who believe their homes have been overvalued, Garcia said.
With home values diving as much as 31 percent year-over-year in places like Homestead, and with more and more residents struggling to pay the bills, the rush to appeal property tax charges is likely to be as high as ever.
"Our office, we're geared up," Wolfe said.
"Most of us have gone through this many times. It's all hands on deck, everybody answers the phone, everybody helps."
Read more: http://www.miamiherald.com/2010/08/15/v-fullstory/1777736/tax-news-unlikely-to-be-happy.html#ixzz0x9uRwQhq
Thursday, August 19, 2010
Publix spirit of 1776: a march toward Biscayne zoning OK - July 1, 2010
By Yudislaidy Fernandez
Before plans keep rolling for Publix's much-anticipated 48,000-square-foot supermarket in the Omni area, the national chain grocer needs the city to grant a zoning change.
The multi-billion-dollar company applied to the City of Miami in March for a class II permit, which would allow it to build the first major grocery store for this booming neighborhood at 1776 Biscayne Blvd.
Design plans and permit request for the new Publix were reviewed by the Planning Department's Urban Development Review Board in late June, the planning department said.
To advance the permitting process, the department said Publix now has to seek a variance to be scheduled for this month.
A variance is often requested by builders to obtain a relaxation in the zoning code without resulting in "unnecessary and undue hardship on the property," according to the city's Web site. The city can grant variances such as for height, size of structure, off-street parking and loading requirements.
The city didn't reply to requests for explanation of the variance type Publix seeks.
The project is to cost Publix $7.5 million to build and encompasses a 48,200-square-foot supermarket, 251-space garage and two adjacent retail spaces, 3,250 and 2,025 square feet respectively, filed design plans show.
Publix didn't return calls for an update.
The site for the new Publix now sits empty other than a handful of fully-grown trees.
The one-square-block supermarket would face Biscayne Boulevard, bordered by Northeast 17th Terrace, Northeast 18th Street and Northeast Second Court, according to filed designs.
With the closest Publix serving this neighborhood now at 4870 Biscayne Blvd., the planned supermarket would benefit condo residents along the Biscayne Boulevard corridor and those in nearby residential areas who have for years voiced the need for a full-service grocer.
"Publix will serve the Edgewater community of condos, the single-family neighborhoods," said Tony Cho, owner and founder of Metro 1 Properties. Most of the residents who are east of Interstate 95 only have access to lower-end grocery stores, he added, but not a supermarket like Publix.
On the other side of the Miami River, the fast-growing supermarket chain has successfully expanded in recent years. Within bustling Brickell, Publix today operates three supermarkets within blocks of one another.
The Omni neighborhood is flourishing with new condominiums, entertainment venues like the performing arts center and new restaurants.
With more density and foot traffic in the area, Publix's decision to open in Omni is one other retailers plan to follow.
For example, Mr. Cho, who specializes in downtown retail leasing, said he has several clients looking to open alternative gourmet markets in the surrounding area.
"Publix is a leading indicator for people who want to follow them," he said, "and I think for the service and grocery sector more businesses will open."
Before plans keep rolling for Publix's much-anticipated 48,000-square-foot supermarket in the Omni area, the national chain grocer needs the city to grant a zoning change.
The multi-billion-dollar company applied to the City of Miami in March for a class II permit, which would allow it to build the first major grocery store for this booming neighborhood at 1776 Biscayne Blvd.
Design plans and permit request for the new Publix were reviewed by the Planning Department's Urban Development Review Board in late June, the planning department said.
To advance the permitting process, the department said Publix now has to seek a variance to be scheduled for this month.
A variance is often requested by builders to obtain a relaxation in the zoning code without resulting in "unnecessary and undue hardship on the property," according to the city's Web site. The city can grant variances such as for height, size of structure, off-street parking and loading requirements.
The city didn't reply to requests for explanation of the variance type Publix seeks.
The project is to cost Publix $7.5 million to build and encompasses a 48,200-square-foot supermarket, 251-space garage and two adjacent retail spaces, 3,250 and 2,025 square feet respectively, filed design plans show.
Publix didn't return calls for an update.
The site for the new Publix now sits empty other than a handful of fully-grown trees.
The one-square-block supermarket would face Biscayne Boulevard, bordered by Northeast 17th Terrace, Northeast 18th Street and Northeast Second Court, according to filed designs.
With the closest Publix serving this neighborhood now at 4870 Biscayne Blvd., the planned supermarket would benefit condo residents along the Biscayne Boulevard corridor and those in nearby residential areas who have for years voiced the need for a full-service grocer.
"Publix will serve the Edgewater community of condos, the single-family neighborhoods," said Tony Cho, owner and founder of Metro 1 Properties. Most of the residents who are east of Interstate 95 only have access to lower-end grocery stores, he added, but not a supermarket like Publix.
On the other side of the Miami River, the fast-growing supermarket chain has successfully expanded in recent years. Within bustling Brickell, Publix today operates three supermarkets within blocks of one another.
The Omni neighborhood is flourishing with new condominiums, entertainment venues like the performing arts center and new restaurants.
With more density and foot traffic in the area, Publix's decision to open in Omni is one other retailers plan to follow.
For example, Mr. Cho, who specializes in downtown retail leasing, said he has several clients looking to open alternative gourmet markets in the surrounding area.
"Publix is a leading indicator for people who want to follow them," he said, "and I think for the service and grocery sector more businesses will open."
Thursday, June 10, 2010
The Florida Housing Numbers Game - June 10, 2010
Up? Down? Sideways? With so many companies issuing reports on the Florida housing market, figuring out the landscape can be confusing.
BY ANA MARIA LIMA
anaalaya@yahoo.com
First-time homebuyer Gabriel Muniz would rather forget the statistics nightmare he suffered when he was looking for a house.
The 28-year-old government employee had a tough time figuring out the plethora of housing reports in the news about home sales, prices and foreclosures. He turned to consumer websites like Trulia and ZipRealty for data, but discovered some outdated information. He scoured government websites for numbers.
"It was probably the worst time of my life,'' said Muniz, who recently bought a three-bedroom townhouse in the Catalina Isles development of West Miami-Dade. "I thought it would be fun.''
Indeed there is a vast array of housing numbers available to consumers and investors and it can be difficult to get a true picture of the market. In order to take advantage of the information, experts say, buyers and sellers should be aware of different methodologies behind the statistics, the motives of the groups that publish reports, and the source of their data.
And in an area as diverse as South Florida, home to everything from luxury waterfront condominiums to urban neighborhoods, everyone needs to be extra cautious of housing statistics that may offer an overly broad view.
"It's a pretty confusing cloud of data out there to a lot of people,'' said Andrew Leventis, senior economist for the government's Office of Federal Housing Enterprise Oversight. "Even to experts it's sometimes difficult to reconcile the different numbers.''
The federal government analyzes home values for the same single-family houses over time, but the data is limited to mortgages of less than $417,000, the maximum amount allowed by Fannie Mae and Freddie Mac, the government's lending agencies.
The Standard & Poor's Case-Shiller Index, widely reported housing information that is targeted to economists, government officials and financial services companies, looks at all single-family homes sales over time, regardless of mortgage amount, but it excludes new construction. For each house that has sold twice, a computer model assigns a weight based on several factors, including whether a home was remodeled, or neglected, and how much time passed between sales.
Florida Realtors, which also releases housing data, uses yet another methodology. The group calculates the median price -- the point at which half the homes sold for more, half for less -- of all the homes sold during a particular month. The data is collected from the Multiple Listing Service, where real estate agents list properties for sale.
Realtors data does not include new homes sold by developers, private transactions and homes sold by the owners.
Different methodologies have led groups to different conclusions.
"It seems like a lot of times the numbers will come out and they are opposed to each other,'' said Jack McCabe, CEO of McCabe Research & Consulting.
Experts stress that conventional methods using the median prices of homes in a given month provide only a snapshot in time, and may be skewed or influenced by what type of homes are selling in a particular period of time. If, for example, there happen to be many more sales of high-end homes one month, the median price will be high.
Ron Shuffield, president of Esslinger Wooten Maxfield, one of the largest real estate brokerages in Miami-Dade and Broward, suggests looking at another set of numbers to get a sense of housing market trends: inventory.
"We're selling twice as many homes today as we were a year ago as an industry and we have half the inventory,'' Shuffield said. "Our business is about supply and demand. Less supply will bring prices up.''
But for those thinking of selling their house now, McCabe reminds them they're "selling near the bottom.''
"Don't think that you're going to get 2005 prices. That was imaginary wealth. That's gone. What you're going to get is a market price and you'll be competing with foreclosures and short sales,'' he said.
McCabe said it's important for buyers and sellers to be aware that data can be "manipulated to present a very positive or negative view,'' and some government data published four times a year can be "antiquated.''
Consumer websites, on the other hand, "can be tremendously out of whack,'' McCabe said. "Some are based on formulas realistic in a normal housing market but not really functional in a boom and bust marketplace like Florida.''
Experts say it is also important for those who use consumer-oriented websites like Zillow and Trulia to cross-check data with public records and other sources.
Trulia gets its information from sale listings on the local Multiple Listing Services, major brokerages across the U.S. and individual real estate agents. It also has foreclosure listings from RealtyTrac.
Zillow takes a different approach and offers what they call the "Zestimate'' home valuation, which is Zillow's estimated market value for a house, calculated using a proprietary formula. It uses public data. Users can update information on their own house.
Besides the array of data Zillow provides, what sets its data apart is its ability to zoom from the U.S. level all the way down to the state, metro area, county, city and ZIP code, said Zillow's chief economist, Stan Humphries. "Other approaches are not able to go that low (in scale) because they need a sufficient volume of homes that sell twice (Zillow includes new home sales),'' he said. "Typically that is the size of a county as opposed to a neighborhood.''
Veteran real estate agents like Riley Smith of EWM said people should ultimately look at local numbers when buying or selling. "Most Realtors will just say, draw a map around the house and ask what's closed in the past six months,'' Smith said. "That's still the best way to do it.''
For folks like Jim Terrill, statistics are key.
Dubbed the "king of stats,'' by his real estate agent, Terrill scoured every housing statistic he could find. When the Key Largo resident and his wife, Linda, decided to move to Pinecrest to live near their grandkids, they searched government records, consumer and Realtor sites and more.
"We had this plethora of information,'' said Terrill, who expects to close on a house in July. "I just can't imagine buying a house without this information because there it is in black and white.''
Buying a home in South Florida can be confusing in the current market. Talk to a Realtor for the most current information to help you with your home-buying decisions. We can also provide you with an up-to-date snapshot of recent sales and current listings in your community. For a free personalized report, call us at 305-456-6456, or click below.
Community Reports
BY ANA MARIA LIMA
anaalaya@yahoo.com
First-time homebuyer Gabriel Muniz would rather forget the statistics nightmare he suffered when he was looking for a house.
The 28-year-old government employee had a tough time figuring out the plethora of housing reports in the news about home sales, prices and foreclosures. He turned to consumer websites like Trulia and ZipRealty for data, but discovered some outdated information. He scoured government websites for numbers.
"It was probably the worst time of my life,'' said Muniz, who recently bought a three-bedroom townhouse in the Catalina Isles development of West Miami-Dade. "I thought it would be fun.''
Indeed there is a vast array of housing numbers available to consumers and investors and it can be difficult to get a true picture of the market. In order to take advantage of the information, experts say, buyers and sellers should be aware of different methodologies behind the statistics, the motives of the groups that publish reports, and the source of their data.
And in an area as diverse as South Florida, home to everything from luxury waterfront condominiums to urban neighborhoods, everyone needs to be extra cautious of housing statistics that may offer an overly broad view.
"It's a pretty confusing cloud of data out there to a lot of people,'' said Andrew Leventis, senior economist for the government's Office of Federal Housing Enterprise Oversight. "Even to experts it's sometimes difficult to reconcile the different numbers.''
The federal government analyzes home values for the same single-family houses over time, but the data is limited to mortgages of less than $417,000, the maximum amount allowed by Fannie Mae and Freddie Mac, the government's lending agencies.
The Standard & Poor's Case-Shiller Index, widely reported housing information that is targeted to economists, government officials and financial services companies, looks at all single-family homes sales over time, regardless of mortgage amount, but it excludes new construction. For each house that has sold twice, a computer model assigns a weight based on several factors, including whether a home was remodeled, or neglected, and how much time passed between sales.
Florida Realtors, which also releases housing data, uses yet another methodology. The group calculates the median price -- the point at which half the homes sold for more, half for less -- of all the homes sold during a particular month. The data is collected from the Multiple Listing Service, where real estate agents list properties for sale.
Realtors data does not include new homes sold by developers, private transactions and homes sold by the owners.
Different methodologies have led groups to different conclusions.
"It seems like a lot of times the numbers will come out and they are opposed to each other,'' said Jack McCabe, CEO of McCabe Research & Consulting.
Experts stress that conventional methods using the median prices of homes in a given month provide only a snapshot in time, and may be skewed or influenced by what type of homes are selling in a particular period of time. If, for example, there happen to be many more sales of high-end homes one month, the median price will be high.
Ron Shuffield, president of Esslinger Wooten Maxfield, one of the largest real estate brokerages in Miami-Dade and Broward, suggests looking at another set of numbers to get a sense of housing market trends: inventory.
"We're selling twice as many homes today as we were a year ago as an industry and we have half the inventory,'' Shuffield said. "Our business is about supply and demand. Less supply will bring prices up.''
But for those thinking of selling their house now, McCabe reminds them they're "selling near the bottom.''
"Don't think that you're going to get 2005 prices. That was imaginary wealth. That's gone. What you're going to get is a market price and you'll be competing with foreclosures and short sales,'' he said.
McCabe said it's important for buyers and sellers to be aware that data can be "manipulated to present a very positive or negative view,'' and some government data published four times a year can be "antiquated.''
Consumer websites, on the other hand, "can be tremendously out of whack,'' McCabe said. "Some are based on formulas realistic in a normal housing market but not really functional in a boom and bust marketplace like Florida.''
Experts say it is also important for those who use consumer-oriented websites like Zillow and Trulia to cross-check data with public records and other sources.
Trulia gets its information from sale listings on the local Multiple Listing Services, major brokerages across the U.S. and individual real estate agents. It also has foreclosure listings from RealtyTrac.
Zillow takes a different approach and offers what they call the "Zestimate'' home valuation, which is Zillow's estimated market value for a house, calculated using a proprietary formula. It uses public data. Users can update information on their own house.
Besides the array of data Zillow provides, what sets its data apart is its ability to zoom from the U.S. level all the way down to the state, metro area, county, city and ZIP code, said Zillow's chief economist, Stan Humphries. "Other approaches are not able to go that low (in scale) because they need a sufficient volume of homes that sell twice (Zillow includes new home sales),'' he said. "Typically that is the size of a county as opposed to a neighborhood.''
Veteran real estate agents like Riley Smith of EWM said people should ultimately look at local numbers when buying or selling. "Most Realtors will just say, draw a map around the house and ask what's closed in the past six months,'' Smith said. "That's still the best way to do it.''
For folks like Jim Terrill, statistics are key.
Dubbed the "king of stats,'' by his real estate agent, Terrill scoured every housing statistic he could find. When the Key Largo resident and his wife, Linda, decided to move to Pinecrest to live near their grandkids, they searched government records, consumer and Realtor sites and more.
"We had this plethora of information,'' said Terrill, who expects to close on a house in July. "I just can't imagine buying a house without this information because there it is in black and white.''
Buying a home in South Florida can be confusing in the current market. Talk to a Realtor for the most current information to help you with your home-buying decisions. We can also provide you with an up-to-date snapshot of recent sales and current listings in your community. For a free personalized report, call us at 305-456-6456, or click below.
Community Reports
Friday, June 4, 2010
Condo Developers Have Sky-High Dreams for Brickell Area - June 4, 2010
Construction on a 35-story condo tower is set to begin in July in Miami's Brickell corridor. SkyPalace developers hope it will pump new life into the area's real estate market.
BY INA PAIVA CORDLE
icordle@MiamiHerald.com
Picture a lobby adorned with Roman columns, statues and a Swarovski crystal chandelier. Eleven stories above, a pool deck offers panoramic views of Brickell Avenue skyscrapers.
Perching atop Publix at Mary Brickell Village, construction on SkyPalace, a new 35-story condominium tower, is slated to begin next month after three years of delay.
Pending financing, Miami's overheated condo market will get its latest infusion when the Mediterranean-style building is completed at the end of 2011. As the first residential building built in the Brickell corridor since the condo glut began, its developers hope it will pump new life into the area's real estate market.
"We want to be one of the only products available in the market upon delivery that's new,'' said Isos Stamelos-Monroe, 30, SkyPalace's vice president of sales.
To date, buyers -- mostly foreign investors and second-home purchasers -- have put contracts on 190 of the 369 units, priced from $249,000 to $2.5 million, he said.
That's a positive step for both the project and the market, said real estate analyst Michael Y. Cannon.
"This is a sign that if they are successful in getting presales, and the construction lender lends, hopefully the market has made its turn,'' said Cannon, executive director of Integra Realty Resources-Miami.
Stamelos-Monroe is counting on existing condo inventory in the area to be absorbed and mortgages to be more readily available by the time buyers close on SkyPalace units.
A March report by Goodkin Consulting and Focus Real Estate Advisors shows that 22,079 new condos were delivered in Miami's downtown corridor, including Brickell, from 2003 through early 2010. More than 70 percent of that inventory has now been absorbed, leaving 7,500 new condos available in the downtown corridor.
'A TOUGH SELL'
But Jack Winston, principal with Goodkin Consulting in Miami, said SkyPalace will have a "tough sell.'' Since the recession began, condo sales have been sluggish and have only begun picking up this year due to bulk sales and sharp discounts.
"In this kind of environment, to absorb [7,500 condo units] is certainly going to take longer than the 18 months it will take to finish the building,'' Winston said, adding that mortgages for end-buyers may still be hard to find.
Key to SkyPalace's sales, Cannon said, will be highly competitive pricing. So far, Stamelos-Monroe said, recent presales have averaged $320 per square foot.
"That's about what market prices are for the rollback of prices of existing inventory of better buildings,'' Cannon said. "So it sounds like they are in the right price range.''
It has taken several years to get to this point.
Skyline Equities Realty initially bought a build-to-suit project for the tower above Publix in Mary Brickell Village from Fairfield Residential in 2004.
Due to delays in the construction of the village, Fairfield didn't begin construction in 2007, as planned. So Skyline Equities Realty negotiated a purchase of the air rights -- the rights to build above the planned Publix -- for less than $9 million, said Stamelos-Monroe, who is also director of acquisitions for Skyline Equities Realty, and the grandson of the companies' CEO, Evangeline Gouletas.
Preconstruction sales of SkyPalace had already begun in 2004, continuing through 2006. But in early 2007, as construction continued to be delayed amid problems pulling permits and troubled real estate and financial markets, Skyline "needed to buy time,'' Stamelos-Monroe said.
ON HOLD
So having added three years to the delivery date, Skyline reaffirmed 162 of its 240 sales contracts in July 2007, he said. Then it continued on hold, as the housing market tumbled.
Now, despite ongoing difficulties securing construction loans, Skyline expects to close on more than $85 million in construction financing from a Colorado-based hedge fund by the end of June.
Construction will begin shortly afterward and continue for about 18 months, Stamelos-Monroe said. Since Fairfield had already started the lobby, foundation and parking garage at 2003-2004 costs, construction time and costs will be lower than they would have been had Skyline had to start from scratch, he said.
As a result, hard construction costs are $150 per square foot, and total costs are estimated at $130 million, or $285 per square foot, including interest, sales, marketing and other soft costs, he said.
"All those factors balance out to make it a go project,'' said Stamelos-Monroe, who expects the building to net a profit of $40 million.
Publix spokeswoman Kim Jaeger declined to comment on the construction, saying the company is "still evaluating the possible impacts to Publix and how best to handle them.''
MEDITERRANEAN LOOK
SkyPalace's design is a Mediterranean village concept, with a modern twist, said Stylianos Vayanos, SkyPalace's vice president of public relations and international marketing. Buyers have the ability to customize units with four or five bedrooms, or buy duplexes, the equivalent of two side-by-side units.
Residents will have access to concierge services. Kitchens will have Italian cabinetry, granite counter tops and stainless steel appliances. And upper floor units will have an unobstructed view of the Bay.
The location on top of Mary Brickell Village should add to its marketability, Cannon said.
"It's right in the center of everything,'' he said. "You've got the Metrorail next door, and the synergism is occurring because you have the day and night life activity going on there. You can work, play and live all in the same area.''
Read more: http://www.miamiherald.com/2010/06/04/1662501_p2/condo-developers-have-sky-high.html#ixzz0puFcwDOI
Call us today at 305-456-6456 or email at info@oceanskyrealty.com for more information about SkyPalace, or other condominiums in Brickell. We would be happy to help you find the home of your dreams.
BY INA PAIVA CORDLE
icordle@MiamiHerald.com
Picture a lobby adorned with Roman columns, statues and a Swarovski crystal chandelier. Eleven stories above, a pool deck offers panoramic views of Brickell Avenue skyscrapers.
Perching atop Publix at Mary Brickell Village, construction on SkyPalace, a new 35-story condominium tower, is slated to begin next month after three years of delay.
Pending financing, Miami's overheated condo market will get its latest infusion when the Mediterranean-style building is completed at the end of 2011. As the first residential building built in the Brickell corridor since the condo glut began, its developers hope it will pump new life into the area's real estate market.
"We want to be one of the only products available in the market upon delivery that's new,'' said Isos Stamelos-Monroe, 30, SkyPalace's vice president of sales.
To date, buyers -- mostly foreign investors and second-home purchasers -- have put contracts on 190 of the 369 units, priced from $249,000 to $2.5 million, he said.
That's a positive step for both the project and the market, said real estate analyst Michael Y. Cannon.
"This is a sign that if they are successful in getting presales, and the construction lender lends, hopefully the market has made its turn,'' said Cannon, executive director of Integra Realty Resources-Miami.
Stamelos-Monroe is counting on existing condo inventory in the area to be absorbed and mortgages to be more readily available by the time buyers close on SkyPalace units.
A March report by Goodkin Consulting and Focus Real Estate Advisors shows that 22,079 new condos were delivered in Miami's downtown corridor, including Brickell, from 2003 through early 2010. More than 70 percent of that inventory has now been absorbed, leaving 7,500 new condos available in the downtown corridor.
'A TOUGH SELL'
But Jack Winston, principal with Goodkin Consulting in Miami, said SkyPalace will have a "tough sell.'' Since the recession began, condo sales have been sluggish and have only begun picking up this year due to bulk sales and sharp discounts.
"In this kind of environment, to absorb [7,500 condo units] is certainly going to take longer than the 18 months it will take to finish the building,'' Winston said, adding that mortgages for end-buyers may still be hard to find.
Key to SkyPalace's sales, Cannon said, will be highly competitive pricing. So far, Stamelos-Monroe said, recent presales have averaged $320 per square foot.
"That's about what market prices are for the rollback of prices of existing inventory of better buildings,'' Cannon said. "So it sounds like they are in the right price range.''
It has taken several years to get to this point.
Skyline Equities Realty initially bought a build-to-suit project for the tower above Publix in Mary Brickell Village from Fairfield Residential in 2004.
Due to delays in the construction of the village, Fairfield didn't begin construction in 2007, as planned. So Skyline Equities Realty negotiated a purchase of the air rights -- the rights to build above the planned Publix -- for less than $9 million, said Stamelos-Monroe, who is also director of acquisitions for Skyline Equities Realty, and the grandson of the companies' CEO, Evangeline Gouletas.
Preconstruction sales of SkyPalace had already begun in 2004, continuing through 2006. But in early 2007, as construction continued to be delayed amid problems pulling permits and troubled real estate and financial markets, Skyline "needed to buy time,'' Stamelos-Monroe said.
ON HOLD
So having added three years to the delivery date, Skyline reaffirmed 162 of its 240 sales contracts in July 2007, he said. Then it continued on hold, as the housing market tumbled.
Now, despite ongoing difficulties securing construction loans, Skyline expects to close on more than $85 million in construction financing from a Colorado-based hedge fund by the end of June.
Construction will begin shortly afterward and continue for about 18 months, Stamelos-Monroe said. Since Fairfield had already started the lobby, foundation and parking garage at 2003-2004 costs, construction time and costs will be lower than they would have been had Skyline had to start from scratch, he said.
As a result, hard construction costs are $150 per square foot, and total costs are estimated at $130 million, or $285 per square foot, including interest, sales, marketing and other soft costs, he said.
"All those factors balance out to make it a go project,'' said Stamelos-Monroe, who expects the building to net a profit of $40 million.
Publix spokeswoman Kim Jaeger declined to comment on the construction, saying the company is "still evaluating the possible impacts to Publix and how best to handle them.''
MEDITERRANEAN LOOK
SkyPalace's design is a Mediterranean village concept, with a modern twist, said Stylianos Vayanos, SkyPalace's vice president of public relations and international marketing. Buyers have the ability to customize units with four or five bedrooms, or buy duplexes, the equivalent of two side-by-side units.
Residents will have access to concierge services. Kitchens will have Italian cabinetry, granite counter tops and stainless steel appliances. And upper floor units will have an unobstructed view of the Bay.
The location on top of Mary Brickell Village should add to its marketability, Cannon said.
"It's right in the center of everything,'' he said. "You've got the Metrorail next door, and the synergism is occurring because you have the day and night life activity going on there. You can work, play and live all in the same area.''
Read more: http://www.miamiherald.com/2010/06/04/1662501_p2/condo-developers-have-sky-high.html#ixzz0puFcwDOI
Call us today at 305-456-6456 or email at info@oceanskyrealty.com for more information about SkyPalace, or other condominiums in Brickell. We would be happy to help you find the home of your dreams.
Friday, May 28, 2010
Mortgage Rates Nearing Lows - May 28, 2010
Global and national conditions are keeping mortgage rates tantalizingly low. But if you want to buy a house or refinance, remember, the low rates won't last forever.
By ALAN ZIBEL
Associated Press
WASHINGTON -- Turmoil in the stock market and the European debt crisis are making life easier for American home buyers and families looking to refinance: Mortgage rates are inching closer to a record low.
The window of opportunity may close soon. Home loan rates will rise if investors grow more confident and shift money out of the safety of government bonds, which influence mortgage rates.
For now, though, rates are tantalizingly low. The average 30-year fixed-rate loan sank to 4.78 percent this week, the lowest this year and barely above the record of 4.71 percent set in December. And 15-year loans are at their lowest rates in two decades.
"Strike now,'' suggested Greg McBride, senior financial analyst at Bankrate.com.
Some homeowners are doing just that. Applications to refinance surged this week to the highest level in seven months, the Mortgage Bankers Association said.
Anxiety over the European crisis has caused global investors to snap up Treasury bonds, which they view as much safer than other investments. Treasury yields have fallen as a result, taking mortgage rates down, too.
When the crisis eases, and especially if the American economy recovery stays on track, expect investors to move out of bonds and back into stocks. That would make mortgages more expensive.
"If the economy finally really shows sustained improvement, rates are definitely going to go up,'' said Fred Chamberlin, a consultant with Alpine Mortgage Planning in Eugene, Ore.
He suggests that homeowners looking to refinance move fast and not hold out for even lower rates.
"If you want the bottom, the only way you're going to know it is when you've missed it,'' Chamberlin said.
As cheap as mortgages are these days, the number of loans being taken out to buy homes remains at its lowest point in more than 13 years. One reason is that a special tax credit for home buyers expired last month. Many had rushed to sign contracts by then.
Another obstacle: trouble qualifying for a mortgage. Borrowers need solid credit and a down payment of at least 3.5 percent. Banks tightened lending standards after millions of borrowers fell into default and foreclosure during the housing bust.
"They're really looking with a magnifying glass,'' said Steve Mevorah, a loan officer with Icon Mortgage Inc. in Las Vegas. "They're trying to make sure that they are flawless loans.''
Analysts had expected mortgage rates to rise when the government ended a program designed to bolster the housing market. Instead, they fell because of fears that Greece would default on its debt.
Also keeping rates low is the government's decision last year to provide unlimited support through 2012 for Freddie Mac and Fannie Mae, which buy mortgages and package them into securities and help keep rates low.
Investors "are very comfortable with the guarantee that is in place,'' notes Credit Suisse mortgage strategist Mahesh Swaminathan. "That, for all practical purposes, is very strong government support.''
Since the financial crisis ended, mortgages of all types have become more affordable -- from the 30-year fixed to adjustable varieties.
The premium that borrowers pay to take out "jumbo'' loans for more expensive homes has dropped by a full percentage point since late 2008, to just 0.8 percent, for instance.
Read more: http://www.miamiherald.com/2010/05/28/1652095/mortgage-rates-nearing-lows.html#ixzz0pFXU6qc3
There has never been a better time to buy a home in Miami. We can help you find your dream home or condo, and also pre-qualify you for one of these near-record-low home loans. Call us at 305-456-6456 for an appointment today.
By ALAN ZIBEL
Associated Press
WASHINGTON -- Turmoil in the stock market and the European debt crisis are making life easier for American home buyers and families looking to refinance: Mortgage rates are inching closer to a record low.
The window of opportunity may close soon. Home loan rates will rise if investors grow more confident and shift money out of the safety of government bonds, which influence mortgage rates.
For now, though, rates are tantalizingly low. The average 30-year fixed-rate loan sank to 4.78 percent this week, the lowest this year and barely above the record of 4.71 percent set in December. And 15-year loans are at their lowest rates in two decades.
"Strike now,'' suggested Greg McBride, senior financial analyst at Bankrate.com.
Some homeowners are doing just that. Applications to refinance surged this week to the highest level in seven months, the Mortgage Bankers Association said.
Anxiety over the European crisis has caused global investors to snap up Treasury bonds, which they view as much safer than other investments. Treasury yields have fallen as a result, taking mortgage rates down, too.
When the crisis eases, and especially if the American economy recovery stays on track, expect investors to move out of bonds and back into stocks. That would make mortgages more expensive.
"If the economy finally really shows sustained improvement, rates are definitely going to go up,'' said Fred Chamberlin, a consultant with Alpine Mortgage Planning in Eugene, Ore.
He suggests that homeowners looking to refinance move fast and not hold out for even lower rates.
"If you want the bottom, the only way you're going to know it is when you've missed it,'' Chamberlin said.
As cheap as mortgages are these days, the number of loans being taken out to buy homes remains at its lowest point in more than 13 years. One reason is that a special tax credit for home buyers expired last month. Many had rushed to sign contracts by then.
Another obstacle: trouble qualifying for a mortgage. Borrowers need solid credit and a down payment of at least 3.5 percent. Banks tightened lending standards after millions of borrowers fell into default and foreclosure during the housing bust.
"They're really looking with a magnifying glass,'' said Steve Mevorah, a loan officer with Icon Mortgage Inc. in Las Vegas. "They're trying to make sure that they are flawless loans.''
Analysts had expected mortgage rates to rise when the government ended a program designed to bolster the housing market. Instead, they fell because of fears that Greece would default on its debt.
Also keeping rates low is the government's decision last year to provide unlimited support through 2012 for Freddie Mac and Fannie Mae, which buy mortgages and package them into securities and help keep rates low.
Investors "are very comfortable with the guarantee that is in place,'' notes Credit Suisse mortgage strategist Mahesh Swaminathan. "That, for all practical purposes, is very strong government support.''
Since the financial crisis ended, mortgages of all types have become more affordable -- from the 30-year fixed to adjustable varieties.
The premium that borrowers pay to take out "jumbo'' loans for more expensive homes has dropped by a full percentage point since late 2008, to just 0.8 percent, for instance.
Read more: http://www.miamiherald.com/2010/05/28/1652095/mortgage-rates-nearing-lows.html#ixzz0pFXU6qc3
There has never been a better time to buy a home in Miami. We can help you find your dream home or condo, and also pre-qualify you for one of these near-record-low home loans. Call us at 305-456-6456 for an appointment today.
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