Recently, there has been flurry of articles in the newsmedia about a pronounced increase in home sales, which has also led to a stock market rally in the runup to the Thanksgiving Holiday. I’d like to take this opportunity to put a bit of local perspective on this latest sales trend:

75% of the homes sold between August through October in Miami-Dade County were priced under $300,000 and 23% of these sales were for homes listed under $100,000.

Price trends at the lower end of the market have been positive, however moving into the higher price ranges, those are areas that we are still seeing weakness.  Typically, when the supply of homes for sale stands at a year or more, prices tend to fall. With a six- to nine-month supply, prices remain flat. When the supply drops below six months, sales activity begins to spur price appreciation, as it has for recent home sold and priced under $100,000.

Below is sampling of the supply of houses listed for sale in Miami-Dade in October, according to the MLS:

• Under $100,000: four-month supply
• Under $300,000: eight-month supply
• $300,000 to $1 million: 21-month supply
• Over $1 million: four-year supply

Miami Beach’s luxury housing market falls into the upper end category, however, the supply is much more restricted due to the natural barrier (island community) limiting further supply.  Also, virtually no new construction is currently taking place, so we’re experiencing a decline in inventory levels for Miami Beach’s 33139 and 33140 zip codes:

• $300,000 to $500,000: less than six month supply
• $500,000 to $1 million: 14 month supply
• $1 million to $2 million: 18 month supply
• Over $2 million: 23 month supply

The conclusion from the above referenced data – there is no room in the Miami Beach housing market for overpriced listings. The strongest demand is for turnkey (completely remodeled) homes, where the new owners do not have to make an additional investment into the property.

To view latest Miami Beach sales data, visit our Miami Beach Real Estate website

* Data Sources: MLS & Miami-Dade Public Records

I’d like to highlight a few of the more significant closed sales information for single family homes located on Palm Island, Hibiscus Island, Venetian Islands and Sunset Islands in Miami Beach from May 1 through August 20, 2008.

A total of eighteen (18) luxury homes sold and closed during this time frame with an average sales price of $3,300,000. The median price per s.f. was $731, with the average time on market of 259 days. In EVERY case, ALL of these homes were significantly price reduced, and represent price rollbacks to 2004 price levels.

ARE YOU SERIOUS ABOUT SELLING? – If you own a condo or a single family home in Miami Beach (especially South Beach), and have had trouble selling, please call us for a free market analysis. I believe in telling it straight to clients (or potential clients) that wishful thinking will not carry the day in this real estate environment.

Once again, the market has shown that it rewards sellers who work with experienced, knowledgeable, detail-oriented, and top producing real estate sales people. Thanks to aggressive and creative targeted International Marketing Campaigns, we have sold ALMOST our entire Residential listing inventory from the first half of 2008.

Below are a few of the more notable home sales that have occurred over the past four months in Miami Beach:

5 beds / 5 baths 13,000 S.F. Home 19,687 S.F. Land
Original List Price: $22,000,000 Sales Price: $10,600,000
950+ days on Market, $815/S.F. Waterfront Home

5 beds / 4 baths 5,300 S.F. Home 12,163 S.F. Land
Original List Price: $6,000,000 Sales Price: $5,400,000
20 days on Market! $1,018/S.F. Waterfront Home Miami Beach

6 beds / 6 baths 6,000 S.F. Home 10,500 S.F. Land
Original List Price: $6,700,000 Sales Price: $4,600,000
400+ days on Market, $766/S.F. Waterfront Home Venetian Islands

2 beds / 2 baths 2,250 S.F. Home 10,500 S.F. Land
Original List Price: $3,400,000 Sales Price: $2,115,000
503 days on Market, $940/S.F. Waterfront Home Venetian Islands

4 beds / 3 baths 3,138 S.F. Home 10,500 S.F. Land
Original List Price: $3,700,000 Sales Price: $2,300,000
163 days on Market, $732/S.F. Waterfront Home Venetian Islands

5 beds / 4 baths 3,007 S.F. Home 8,414 S.F. Land
Original List Price: $3,700,000 Sales Price: $2,700,000
400+ total days on Market, $897/S.F. Waterfront Home Palm Island

4 beds / 3 baths 3,026 S.F. Home 9,500 S.F. Land
Original List Price: $1,695,000 Sales Price: $1,180,000
562 days on Market, $389/S.F. Non-Waterfront Property Hibiscus Island

The State of Florida is still in desperate need of property tax reform & reduction. The measure that was approved last year has helped to provide some limited tax reductions, but has turned out to be a complicated & very limited property tax reduction effort. There is a new initiative to significantly reduce property taxes next year, called AMENDMENT FIVE, which would eliminate from 25-40% of today’s current property taxes, creating a SIGNIFICANT reduction in the total cost of home and/or business ownership. To replace the lost revenue, Florida sales tax would increase by about 1%.

5 Reasons To Vote YES for Amendment 5

Amendment 5 is a long overdue tax cut for all property owners: families, businesses, second homeowners and investors. Property tax levies have doubled over the past six years – from $15 billion in 2000 to $30 billion in 2006. With higher fuel prices and food costs, and stagnant incomes, it’s no wonder Florida families are struggling to make ends meet. If you’re living the American Dream in Florida, you stand to save 25% to 40% on your property taxes in 2010.

Amendment 5 will jump start Florida’s economy. Economists estimate that Amendment 5 will save property owners more than $10 billion in taxes. This will increase the liquidity and net spendable income of millions of property owners.

Amendment 5 will shift the burden of funding education from property owners to all who access the public school system. Currently, property owners pay a disproportionate share, compared to renters, for our schools. And property owners whose children attend private school pay tuition and public school taxes. By funding schools through sales taxes and other measures, Amendment 5 creates a more equitable tax system.

Amendment 5 offers much-needed tax relief for millions of property owners and continues the momentum created by Amendment 1 – approved by voters in January 2008 – toward reforming Florida’s archaic property tax system. Amendment 5 also pressures legislators to get serious about tapping stable and lucrative revenue sources for schools such as Internet sales (a $3 billion cash cow and an increase in state sales tax — much of it paid by non residents!).

Amendment 5 will provide much-needed tax relief to Florida’s seniors, many of whom fear losing their homes because of an inability to pay higher property taxes on a fixed income. On November 4, you have an unprecedented opportunity to vote YES for the biggest property tax cut in Florida history. Vote YES on Amendment 5.

The Five Most Common Myths about reducing Property Taxes Further:

Myth #1
Opponents say Amendment 5 will take valuable funding away from schools.

False! Amendment 5 requires the Legislature to provide required funding for schools. Instead of the funds coming from property owners in the form of taxes, it could come from sales taxes, reduced spending or any other source determined by lawmakers.

Myth #2
Opponents say Amendment 5 will raise the state sales tax and disproportionately affect the poor and needy.

False on two counts! First, Amendment 5 does not require the Legislature to increase the state sales tax. Second, necessary goods and services will remain exempt from a higher sales tax. These include unprepared food, rent, heating fuel, medicine, electricity and health care services.

Myth #3
Opponents say Amendment 5 equals a sales tax on services.

False! Amendment 5 does not dictate to lawmakers how to make up the revenue to fund our schools — including any new tax on services. It points out obvious options, such as a reduction in spending, and encourages lawmakers to come up with other revenue sources, such as collecting sales tax on items currently taxed in retail stores but not when purchased on the Internet.

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Statistical Source: The Miami Herald 6/19/08

Everyone is well aware of Miami’s downtown building oversupply, but just how bad is it? In the last six years, 22,737 units were built or are now under construction in Miami’s urban core — more than double the number built in the nearly 40 previous years, it’s a large figure, but still less than many predicted. Perhaps no section of Florida has seen more building in recent years than downtown Miami’s urban core.

However, with the housing market turning in 2006, the credit crunch of 2007, and inexperienced developers having to cope with rising construction costs & mismanagement, many proposed projects never went beyond the planning stages. With few new projects starting in the past two years, the real scope and size of Miami’s downtown condo craze is starting to come into focus. Although the downtown market still has a vast surplus of condos- it is not 50,000 or 80,000 new units, it’s estimated that 22,000 new units. The bad news is that it is still 22,000 new units.

I recently came across an interview with Jim Cramer (from Mad Money on CNBC), which I believe accurately predicts future real estate trends for the Southeast Florida housing market. For anyone considering buying Miami Beach, South Beach, or even downtown Miami waterfront properties, NOW is the time to be making offers on well priced properties.

Cramer’s Key Points:

• Inventory is drying up & being steadily being absorbed
• Housing starts have been down for over two years
• New construction projects stopped two years ago
• Florida is generally one year ahead of market trends
• Interest Rate cuts have had a positive effect in absorbing excess inventory (at much reduced prices)

Watch Jim Cramer’s Interview Below:

Buying investment property is under normal circumstances a practically surefire method of making long term profit but right now it’s not something a lot of people are doing. This matter has bolstered the demand for property renting which many buyers of investment property are now using as a means of making sure the properties they’ve put their money into still generate a profit in the meantime. If you’re in a similar situation and happen to own something like a South Beach luxury home that’s losing money, take into account these important renting tips.

Rent money is taxable. Renting a home works the same way as if you were selling goods and services to a consumer which may therefore require that you report this income once tax season rolls around. On another note, make sure your homeowner’s insurance covers rentals in case of unforeseen damages to the property or even the tenant.

Be ready for anything. People tend to be quite lawsuit happy in this country and with renting, there’s always that risk that a tenant might sue you because they don’t like the rent you’re charging or some other matter so strongly consider hiring a property manager who knows what you can charge as well as a lawyer who knows about rental properties.

Don’t rent to just anyone. Remember that the tenant who you say yes to will be living in this property you’ve likely invested lots of money in so take the necessary precautions (references, credit check, etc) to try and make sure that they not only have a high degree of cleanliness but that they’re not a financial liability waiting to happen.

Treat the home as if you were living there. You own the property and there’s a good chance you’re going to sell it once real estate picks up again so take care of the necessary repairs and duties to keep it looking nice and you’ll also have much happier tenants.

Some useful tips to help you sell your Miami Beach home or condo.

What Works:

• Be willing to contribute to Buyer’s Closing Costs
• Consider Seller Financing
• Offer to pay for Buyer’s Mortgage Points
• Get a Home Warranty

Gimmicks that generally DO NOT work:

• Free Vacations
• Free TV’s and cars
• Non-related seller contributions

Click on the image below to watch the video

With a PROVEN track record of Cancelling debts, we can help you sell your Miami Beach home or condo.

Call (305) 673-3809 or email amkeer@fir.com for more info.

In one’s lifetime, there comes that point when the thought of buying your first home begins to manifest itself. Alas, buying South Florida homes these days is something many will advise against due to the uncertain status of the real estate market. Yet there are those people who will tell you the complete opposite and passionately explain to you why buying in the current inventory of property for sale is actually wise.

With conflicting opinions and advice coming from both sides, it’s easy to be intimidated by the home buying prospect. You may be thinking, “Okay, I really want a Miami Beach condo by the water to call my own so…should I buy a home right now or not?”

Any real estate agent well-informed in Miami Beach real estate and/or the industry itself will explain to you that during tricky market times such as these, the decision doesn’t come down to an easy yes or no answer. Those people who may have told you that you will be losing money if you buy are indeed correct. Whatever you choose to pay now, you could pay less for in a few months. Also, due largely to the mortgage and foreclosure issue, lenders are playing hardball with borrowers and have become quite selective about who they lend to.

Then again, the prospects could be extremely worthwhile. For one, property prices have gone down considerably which should bring you closer to obtaining that four bedroom home in Miami Beach you’ve always wanted and interest rates on mortgages have gone down which should translate to a more affordable monthly mortgage payment, particularly if you’ve maintained an outstanding credit history.

It can be safely assumed then that there is no real right or wrong when it comes to buying a home. Yes you will lose money and this is something you need to be able to deal with before you do anything else. Sometimes however, it’s not so much the money that matters as it is finding a home to call your own.

Downtown Miami is well known for its many high rises made up of luxury condos like 50 Biscayne, Marquis Miami, 900 Biscayne, Ten Museum Park, and Icon Brickell office buildings and a few company headquarters. While the Four Seasons Miami Hotel may be the most expensive, fanciest and the largest, it could eventually be dethroned by a building that will truly pierce the skyline if certain local developers manage to have their way.

Designed by the renowned Kobi Karp, a pair of 1,022 foot buildings soaring over ninety stories into the Miami skyline to be known as the Empire World Towers are being planned and are notable not only for their incredible height, but also for the three “sky bridges” that connect one building to the other and are likely going to be translucent, suggesting a feeling of walking on air hundreds of feet above the ground.

Although they are expected to function as a high rise condo and/or residential property, many people might look at this and wonder why anyone would find this worthwhile considering that condo sales and Miami and Miami Beach real estate has, overall, slowed.

The Empire World Towers still remain a massive work in progress and the developer doesn’t expect to finish the building at least until 2010, two years from now when most have concluded that real estate should be doing significantly better. Therefore, the Empire World Towers could potentially become a prime building for investors seeking their next residential property investment.

The project is still in its infancy and has yet to be approved by the Miami City Commission. Assuming it manages to clear all the red tape, Empire World Towers could be an integral piece towards reinforcing tourism in Miami. After all, people will definitely want to visit to see for themselves what would become the tallest building in Miami. Already located in one of South Florida’s finest urban communities, Empire World Towers has tons of potential.

Miami Beach High-Rise Luxury Residential Condos:

• Continuum South Beach
• Portofino Tower
• Icon South Beach
• Murano Grande
• Akoya Miami Beach
• Setai South Beach
• Fontainebleau II
• Green Diamond Tower
• Blue Diamond Tower

Most of these residential condos are luxury and located directly on the ocean with direct access to the beach.  Almost all of these condos new and less than ten years old.

The Real Estate Diamonds in the Rough

Miami Beach real estate can no longer claim to appeal strictly to people with six or seven figure salaries. Today the surplus of properties up for sale in the city has eroded prices, revealing plenty of possible investment prospects for those willing to ignore the steadfast doom cries of the real estate soothsayers and find their next lucrative opportunity.

If you’re renting at a condo like Terra Beachside Villas or ICON, it may come as a slight shock to be told that the money you’re plunking down for your lease is potentially going to waste. Instead of it becoming something that will return you a long term profit, you’re periodically losing hundreds.

Recent news reports show overall property values have plummeted to an eight year low, which essentially equates to being able to actually live in that luxury condo by the ocean closer to an imminent reality than the future pipe dream it once seemed. Pre-construction units continue to materialize and their prices also come with an increasingly reasonable price tag. If you decide to simply wait it out and join the legion of â¬Sdoomers⬝, don’t be surprised if you find yourself possibly regretting that decision once the market returns to a healthier state.

Since you’re already living in Miami Beach, it’s safe to assume you’ve got fairly deep pockets. If you’re managing that spare change in order to pay off your â¬Spad⬝ in the next decade or so it’s quite likely the market will be in better shape come that time which means your condo’s value would likely have increased substantially.

If you’re not in it for the money, that’s fine. Then again, a hint of bragging bravado never hurt anyone. You may find yourself filled with giggly delight as your friends and loved ones stare in amazement at how you were capable of conjuring the funds for that bewildering three bedroom sanctuary with all the bells and whistles that often come with the word “luxury” attached to them. Obviously you didn’t pay anywhere near the princely sum they have in mind but that will be your own little secret.

Nobody’s telling you to go out and splurge on the first property that catches your eye but, just like the old adage “misery loves company”, don’t just sit around with your arms folded like so many of these pessimistic real estate enthusiasts and let a potential opportunity pass you by. After all, there’s absolutely no harm in looking.