Reuters.com is a trusted source for businesses and professionals looking for industry expertise. An article came up yesterday regarding the South East Florida (Miami) market ”Florida Luxury Home Market Showing Signs of Wear” Read Here. It goes on to talk about the influx of investors from Canada and Europe pouring their strong currencies into luxury properties and how Donald Trump lowered his Palm Beach mansion by 20% as housing woes now touch the wealthy.

“The surprisingly healthy market for oceanfront mansions and palatial condos in Florida, one of the most toxic states in America’s housing meltdown, may finally be showing some cracks.”

They go on to quote local Miami brokers and FAR (Florida Association of Realtors) sales figures relaying that Miami is overbuilt and overpriced for the United States… but really though, for a major metropolitan city with the Forbes vote on the cleanest City in America along with perfect 80 degree weather year round, I’d have to disagree on it being overpriced today. YES, overdeveloped and the market is and has been correcting itself with prices back to 2002 levels. DOWNTOWN MIAMI still has a lot of new inventory coming and not as desirable or in demand as the oceanfront luxury condos. Tourists, Baby Boomers, Foreign Investors and alike want what? OCEANFRONT. Enough said. There is a great selection of luxury condos in Miami available today along the Atlantic ocean but my figures show inventory going down each consecutive month since the 1st quarter 2008 along the Miami Dade oceanfront communities including Sunny Isles Beach, Bal Harbour,  North Bay Village, South Beach and Miami Beach.   (continue reading…)

Miami has a New Vice of bottom fishing for Miami condo bargains. New condo buyers from the U.S. and abroad are descending on Florida to buy condos that have suffered from depreciation along with the excessive inventory, subprime mortgage crisis and credit crunch. Some are searching for investment properties, confident today’s prices will eventually rebound. Others are hunting for vacation or retirement homes along the Atlantic Ocean.

In heavy hit Miami Dade County (Downtown Miami), condos originally costing as much as $1.4 million at the peak of the market now sell in some cases for $840,000, a 40 percent drop while Oceanfront Condos have dropped approximately 25 percent since 2005. Such price drops have people like Bruce and Suzanne Bowen, of San Juan, Puerto Rico, and fishing for deals. The Bowens have visited Miami three times since November to scout for properties, and recently bought a two bedroom, 1,200 square foot unit on a high floor with Biscayne Bay views in Miami’s fashionable Brickell district. Mr. Bowen made his move after prices in the building fell to $290 a square foot from nearly $400 in September.

Now, the couple is looking for a second condo.“We’ve been coming here for 10 or 12 years, and I know how much cheaper it is today,” says Mr. Bowen, a 46 year old banker. “I may miss the bottom by 10 percent or so, but five years from now, that will be irrelevant. The underlying fundamentals are still very strong here.”

Florida is a reflection of what’s happening across the country. As the price of condos which tend to be popular among investors, retirees and second home owners took a dive in many once hot markets, buyers are emerging to grab Miami properties very cheap. They’re finding plenty to choose from and driving hard bargaining power. Because of Florida’s perennial popularity among real estate investors and vacation and retirement home buyers and as young families have migrated there from other states many areas were flooded with great new projects in recent years. Now, amid the downturn, Florida condo sales are sharply down, off an average of 27 percent in 2007 from the year before, says Sean Snaith, an economist at Orlando’s University of Central Florida.Perhaps nowhere is the carnage as well as the opportunities and risks of condo bottom fishing more evident than in Downtown Miami real estate (Dade County), where about 2,391 condos are currently for sale, according to Multiple Listing Service statistics. Cranes line Downtown Miami’s skyline, and though several projects have been cancelled, new condo towers in various stages of completion rise up everywhere. By most estimates, 2,000 to 5,000 more condo units will become available over the next 18 to 24 months. Given that about 400 condos are sold in a typical year in the area, the supply overhang means prices may fall further. The result is apparent on Biscayne Boulevard, where four towers sidle against each other. Though the views, location and materials are all similar, two buildings Marina Blue and Ten Museum Park began construction prior to the hurricanes, and units there are priced today at roughly $400 a square foot. The other two 900 Biscayne Bay and the Marquis began going up after the hurricanes and are priced in the $600 per square foot range.

Another potential hazard for buyers is foreclosures. In some buildings, foreclosures represent as much as half the units, according to Florida’s Office of the Condominium Ombudsman. A high foreclosure rate means special assessments will likely be imposed on unit owners of remaining condos at some point to help pay for common maintenance costs. This will unexpectedly raise your cost of ownership. Moreover, foreclosed properties in South Florida tend to be priced near the mortgage amount. Given the run up in prices before the shakeout, that means foreclosure buyers could pay inflated prices at the auction block. A better approach is to simply wait for banks to reclaim property that doesn’t sell at the auction. You’re more likely to be able to negotiate a better bargain then as it hits the market at great pricing.

One crucial note buyer’s should be aware of are the differences in Miami Downtown vs. the Miami Beaches. With limited space and inventory along the Atlantic Ocean, there are not as many foreclosures as found on the mainland of Miami. Buyers with cash might expect 75 to 80 cents on the dollar on oceanfront condos in Sunny Isles and Miami Beach FL real estate. True, the inventory and selection on the ocean is excellent and there are plenty of deals to be had on oceanfront real estate, yet there is no blood bath found along the Beaches as we see in Downtown Miami. MLS Statistics show 2008 properties selling on average at 90 cents on the dollar. Notice the Bank United’s Black List did not contain one oceanfront property! My perspective is another 18 months of great Miami Oceanfront Deals. Take advantage of today’s low interest rates if you must finance, buy and hold as to time this market perfectly is a roll of the dice. To buy at the bottom and sell at the top is everyone’s desire but also an easy target to miss.

This article originated from the Wall Street Journal and the original article was written by Jeff Opdyke Sunday March 2, 2008. Feel free to add your insights and thoughts to this blog posting and make it a great day.

A Simple solution to real estate investing. Buy when everyone is selling and Sell when everyone is buying. A simple real estate investment 101 formula but forgotten by the majority of speculators. This article is to inform the skeptical buyers on what the elite investors ARE doing with Miami Dade real estate investments.

Jorge Perez CEO of the Related Group. If you don’t know the name you should. Perez is the biggest high rise condo builder in Florida and among the biggest in the country. For the past decade, he has been closely watched in the industry because he has demonstrated a knack for spotting trends and quickly taking advantage of them. During the boom of 2001 to 2005, Perez and his company, the Related Group, built some of the best (over one dozen) pre construction condo developments in Dade Counties Downtown Miami and Brickell area. He is known for teaming with Trump & Dezer for the new Trump Towers I, II & III being released this year among dozens of other incredible real estate monuments in Florida. Yesterdays article in the Miami Herald interviewed Perez who is now making a $1 billion dollar bet that the South East Florida region’s real estate market is a bargain.

“Condo builder Jorge Perez said South Florida real estate is undervalued and he’s setting up a $1 billion fund to start buying properties” Perez was quoted “I strongly believe that Miami real estate is undervalued and Three years from now, people will look back and be amazed.” MiamiHerald.com

His decision to launch the “opportunity fund” as he calls it, should be interpreted as a sign of confidence in South Florida’s condo market, not a reason for worry. His plan is premised on the long term growth and success of the SouthEast Florida real estate market. Perez said the investor group intends to hold units for two to five years at a loss and then sell at a profit when he bets, the market will have improved. Perez said he has not decided to use the investor fund to buy his that he built although he anticipates as many as 20% buyer defaults on his developments. The developer said he will rent unsold unit out himself, without the investor fund. Perez is now diversifying his portfolio geographically by launching more than 10 projects in Latin America.

My opinion is you’re never going to find the bottom of the market. At some point you’ve got to make the decision to Think Big, Aim High and Act Bold. A lot of unsold inventory will be purchased by the Investor “opportunity” fund plus the rental surplus by The Related Group of unsold developer units in part because of lack of demand, over speculation in a less desirable area of Downtown Miami and Brickell real estate as today’s buyers want oceanfront luxury condos. Interest rates have had the biggest cut since the 1980’s.

“Don’t wait to buy real estate, buy real estate and wait” Donald Trump

With it’s dynamic business climate, the Miami metro area ranked first in the nation on the 2007 Kauffman Index of Entrepreneurial Activity, an annual study that measures business start up activity across the United States. In the coming year, IEC expects the Miami Dade area to rank near the top of the state in per capital personal income level, average annual wage and gross metropolitan product. Outside of the new housing sector, Miami’s economy is in very good shape. New jobs are being created in tourism, health care and especially trade, thanks to the strong economies in Latin America. With it’s international business orientation, Miami continues to attract multinationals, such as Touchbase, a British voice and data communications company that plans to hire 30 people over the next three years for it’s new Miami regional office. Miami’s easy access to Latin America, Europe and elsewhere makes it an ideal hub for those whose lives keep them on the move. Miami Dades multicultural, multilingual environment makes the region very welcoming to international buyers. Miami is a convenient port of entry from South America and Europe, and offers major cultural, sports and recreational events. For instance, the December Art Basel show on Miami Beach FL real estate attracts affluent Europeans who tell family and friends about south Florida.