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Thread: Prices Definitely Coming Down in Miami/Miami Beach

  1. #1
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    Default Prices Definitely Coming Down in Miami/Miami Beach

    Just got a notification from Trulia that a condo I had my eyes on in SoFi, at The Jefferson, finally sold today after being on the market for 150+ days. Seller took 6% less than his asking price. Nothing I can do anyways until I sell my place in San Diego (no offers within first 25 days on market in a tight market, not even a lowball offer)...tells me prices even in the most desirable areas of Miami Beach, including SoFi, are coming down--if only slightly....friend of mine who is a realtor in NYC says the same thing is happening there.

    I am not making this statement based on one property--I am seeing more units on the market longer, getting less than original asking price as more inventory comes on the market while foreign investment in the form of real estate purchases is down.
    Last edited by elchevere; 07-18-2016 at 10:52 PM.

  2. #2
    Senior Member Marc Middleton's Avatar
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by elchevere View Post
    Just got a notification from Trulia that a condo I had my eyes on in SoFi, at The Jefferson, finally sold today after being on the market for 150+ days. Seller took 6% less than his asking price. Nothing I can do anyways until I sell my place in San Diego (no offers within first 25 days on market in a tight market, not even a lowball offer)...tells me prices even in the most desirable areas of Miami Beach, including SoFi, are coming down--if only slightly....friend of mine who is a realtor in NYC says the same thing is happening there.

    I am not making this statement based on one property--I am seeing more units on the market longer, getting less than original asking price as more inventory comes on the market while foreign investment in the form of real estate purchases is down.
    Yes, I agree. About 6% is the common discount now on average. We've been analyzing a few buildings in Mid Beach for a client of mine and it seems 5%-7% is the most common closing price discount.

    Brazil and Venezuela aren't doing well so the buyers are coming from the N.E/Canada/Mid West right now, as well as the usual foreign people that were going to invest regardless.

    The $1ML+ buyers who can't buy in secret are waiting until Aug 28th when the new regulation expires (unless the govt decides to extend the effort), which also hurt NYC as its only in these 2 cities.

    There are A LOT of overpriced condos on the market as well. When its priced right (Based on real comps), they are still selling quickly (in the $300k-$800k range). Sellers see comps from last year and want 5%-10% more because that was the increase in 2013 and 2014. That's not happening right now. You should price your condo or waterfront house/townhouse at a comp from late 2014 or early 2015 if you expect to sell it. (not to mention have it show ready, make it easy to show, etc.)

    Houses and Townhomes West of 95 & Broward in the $175k-$300k range are still flying off the market.

    There are some great deals in N Bay Village / Normandy / North Beach right now for condos under $300k. It just goes back to the market and most importantly, the price range. Those getting a mortgage won't find a lower interest rate and there are lots of lenders now offering lower downpayments to get people into their home/condo.

    I would summarize with this, if you are looking to spend $500k-$1ML, you are in a good bargaining position right now in Miami-Dade and parts of Broward.
    Last edited by Marc Middleton; 07-19-2016 at 11:21 AM.
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    That's good for a prospective buyer, such as myself, ONCE my condo in San Diego sells....I believe I am fairly priced and suspect it might take awhile for it to sell based on the fact it is a "loft" style condo (occupies the 2nd and 3rd levels of a 3 story building, entailing 17 steps to get to my front door and another 13 steps up a spiral staircase to the master bedroom loft.....probably limits the saleability to a single, male professional such as myself)....not sure a drop in price will motivate a buyer or young couple/elderly person if they are looking for a conventional, same floor layout vs. loft layout....funny, but the market and prices in San Diego are still increasing while inventory supply remains fairly tight. We are also getting our first 'super luxury' condo built (under construction now) just a few blocks from my building with prices starting at $1.1M (includes access to community yacht and chauffered luxury car fleet), along with a complete renovation of Seaport Village by the same company that developed South Pointe Park.

    I suspect there will be continued opportunities with further price reductions in Miami, including SoBe, over the next 12-24 months--particularly if we were to go into a recession and/or experience a significant stock market correction (talking more like 25-30%--not just a 10% correction). Whereas SoBe, and SoFi in particular, will correct less than other areas I still think the potential for another 5-10% drop even in these prime areas is possible, which is why I will rent for the first year+ once my condo sells and I relocate to Miami Beach....if I get an acceptable offer, looks like I could be selling towards the high in San Diego and possibly buying towards the low in Miami Beach--would be a change in behavior for me (I usually buy high and sell high).

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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by elchevere View Post
    That's good for a prospective buyer, such as myself, ONCE my condo in San Diego sells....I believe I am fairly priced and suspect it might take awhile for it to sell based on the fact it is a "loft" style condo (occupies the 2nd and 3rd levels of a 3 story building, entailing 17 steps to get to my front door and another 13 steps up a spiral staircase to the master bedroom loft.....probably limits the saleability to a single, male professional such as myself)....not sure a drop in price will motivate a buyer or young couple/elderly person if they are looking for a conventional, same floor layout vs. loft layout....funny, but the market and prices in San Diego are still increasing while inventory supply remains fairly tight. We are also getting our first 'super luxury' condo built (under construction now) just a few blocks from my building with prices starting at $1.1M (includes access to community yacht and chauffered luxury car fleet), along with a complete renovation of Seaport Village by the same company that developed South Pointe Park.

    I suspect there will be continued opportunities with further price reductions in Miami, including SoBe, over the next 12-24 months--particularly if we were to go into a recession and/or experience a significant stock market correction (talking more like 25-30%--not just a 10% correction). Whereas SoBe, and SoFi in particular, will correct less than other areas I still think the potential for another 5-10% drop even in these prime areas is possible, which is why I will rent for the first year+ once my condo sells and I relocate to Miami Beach....if I get an acceptable offer, looks like I could be selling towards the high in San Diego and possibly buying towards the low in Miami Beach--would be a change in behavior for me (I usually buy high and sell high).
    Why not keep it and rent it out?

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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Would fall about $400-500/mo short of covering my mortgage and taxes (until paid off in 6 years), the building is 30 years old with newer units coming on the market and I'm trying to sell before my air conditioner goes and I have to shell out $8K to replace...not crazy about renting from cross country and/or spending more money, at a further loss, to hire a property manager....am I missing anything?

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    Senior Member Marc Middleton's Avatar
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by elchevere View Post
    Would fall about $400-500/mo short of covering my mortgage and taxes (until paid off in 6 years), the building is 30 years old with newer units coming on the market and I'm trying to sell before my air conditioner goes and I have to shell out $8K to replace...not crazy about renting from cross country and/or spending more money, at a further loss, to hire a property manager....am I missing anything?
    Nope, you pretty much nailed all the risks :-)

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    Editor Matt Meltzer's Avatar
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by elchevere View Post
    Would fall about $400-500/mo short of covering my mortgage and taxes (until paid off in 6 years), the building is 30 years old with newer units coming on the market and I'm trying to sell before my air conditioner goes and I have to shell out $8K to replace...not crazy about renting from cross country and/or spending more money, at a further loss, to hire a property manager....am I missing anything?
    Feel your pain, brother. I've been renting out a house in Seattle for a year for over double the mortgage, and with repairs and management fees I've broken even. It ain't easy.

    I have thoughts of selling it and buying multiple condos here to rent, but in terms of long term value, I cant see a condo here being a better investment.

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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Funny, but sounds like my realtor is getting anxious for his commission check after only 30 days and no offers...he's trying to get me to lower my price and/or trying to scare me by claiming the price I am asking might not get appraised for that amount.

    If my place were a conventional same floor 2BR 2BA condo with easy access via street or elevator I might agree--but it's not....one young couple came over with their 4 month infant with the father not wanting to climb my spiral staircase to the master bedroom loft...another guy came over and claimed he has 3 kids who come over frequently and my floorplan is not suitable for his needs....no shit, Einstein....my place will most likely be bought by a single professional--that limits my market size, will take awhile to sell, and perhaps my realtor should micro market and target attorneys (plenty of them work near where I live) who want to move and be closer to their work. In both of the cases cited above, I could have dropped my price $25-50K and they still would not have made an offer...its the layout/floorplan, not the price.
    Last edited by elchevere; 07-23-2016 at 03:46 PM.

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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by Matt Meltzer View Post
    Feel your pain, brother. I've been renting out a house in Seattle for a year for over double the mortgage, and with repairs and management fees I've broken even. It ain't easy.

    I have thoughts of selling it and buying multiple condos here to rent, but in terms of long term value, I cant see a condo here being a better investment.

    Bro, I can relate because I've been dealing with similar issues as an absentee landlord for over a decade.

    Last week. I fulfilled a promise and finally took the Mrs. to Ojai. I've spent many a summer soccer camps at Thacher School as a teen. Beautiful country and so idyllic. My jaw dropped how affordable many decent homes are there. I'm seriously looking and pitching we pick up a place there. No risk inherent compared to Miami.
    Last edited by Blackford Oakes; 07-23-2016 at 03:56 PM.

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    Senior Member Marc Middleton's Avatar
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Quote Originally Posted by elchevere View Post
    Funny, but sounds like my realtor is getting anxious for his commission check after only 30 days and no offers...he's trying to get me to lower my price and/or trying to scare me by claiming the price I am asking might not get appraised for that amount.

    If my place were a conventional same floor 2BR 2BA condo with easy access via street or elevator I might agree--but it's not....one young couple came over with their 4 month infant with the father not wanting to climb my spiral staircase to the master bedroom loft...another guy came over and claimed he has 3 kids who come over frequently and my floorplan is not suitable for his needs....no shit, Einstein....my place will most likely be bought by a single professional--that limits my market size, will take awhile to sell, and perhaps my realtor should micro market and target attorneys (plenty of them work near where I live) who want to move and be closer to their work. In both of the cases cited above, I could have dropped my price $25-50K and they still would not have made an offer...its the layout/floorplan, not the price.
    True, sometimes the only way a realtor knows to sell a house is affect the price..its sad, but true. This person may have to actually sell it! As long as the COMPs support the price, then I wouldn't lower it unless you need to get going on a move or something. Otherwise, if you are living there and enjoying it, don't rush. I don't know the CA market at all so I can't offer any other bit of advice than that. I know with condos you can't really do open houses either, so he/she is going to have to get creative! Like you said, single professionals or young couples with no kids. Tell him to e-mail/flyer the local big attorney offices & doctor's offices. Create some urgency..advertise others in the building and then bring those people to your unit, etc .
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    Default Re: Prices Definitely Coming Down in Miami/Miami Beach

    Thanks...i might have to do that on my own, sad to say-I know it will get done..as far as comps, mine is going for a $30-40K premium vs other units in my complex because there are about $80K of upgrades. It is fairly priced v units in other complexes.

    Couple of lessons learned going forward for my next place--(1) dont buy the most expensive unit in the complex and (2) stick with a more conventional floor plan.

    It is a very nice place, just a question of the right person finding it and wanting it...my realtor cannot control who other agents bring to see my place and Im fairly certain he legally needs to show it to them, even if a prospective buyer has kids or is an elderly couple which amounts to a waste of everybody's time--one more reason why he should be proactive and target nearby law firms.

    I also suppose it might get "stale" should it reach 100 days on the market but it will not sell if it is not listed....I am in no rush and dont have to sell, but I do want a premium v less upgraded units in my building and will not sell if I do not get it.

    Nobody said moving is easy but at least it will be on my terms.
    Last edited by elchevere; 07-24-2016 at 12:02 AM.

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