Is It Time To Buy A New Luxury Condo In Miami?
Author: FrankKasper Total views: 20 Word Count: 423
If you're thinking about buying one of those new condominiums in Miami then you better do your homework like your life depends on it. I know it would be really cool to be living in a new luxury high rise condo in Miami close to South Beach but here's some things that you may want to consider before you sign a contract.
There are thousands of new vacant condos in the Miami area with ocean, bay or city views, valet services and roof top pools. Before you pack your bags you might want to ask yourself why are all these "luxury" condos still vacant?
Well I'm going to share with you some of the reasons these units are vacant and why you may be making a huge financial mistake if you decide to buy one of these units.
Starting in 2004 thousands of new condos in Miami went under construction. Investors flocked to these units in order to sign pre-construction contracts in the hopes that they would be able to flip them for huge profits. With closing dates set for mid to late 2005 they thought they were going to cash in big. But the market came to a screeching halt at the end of 2005. The investors that couldn't flip them or move into them walked away from their deposits and contracts.
This one fact left hundreds or thousands of units vacant. Builders scrambled to sell them by offering incentives like, one year of free maintenance, no closing costs or appliance upgrades. Well after six months this didn't work so they started reducing prices to the point where I don't think they were making any profit. These builders just wanted to get out of the projects and get the units sold.
Per the multiple listing service as of June 23, 2008 there were 4,591 vacant units and 14,742 active listings in the Miami downtown area.
So is it time to snatch these units up?
I don't think so and here's some of the reasons why;
1. Values are still declining.
2. These condo projects may be hard to obtain financing in.
3. The monthly/yearly maintenance may go up substantially.
4. Special assessments may be ongoing due to the number of vacant units.
5. The number of rentals in the project may be too high to obtain financing.
6. The number of foreclosures in the project may affect or prohibit financing.
Well I hope this information has helped you realize some of the obstacles you may face. As always "Buyer Beware".
To obtain property information in Miami Dade County go to www.miamidade.gov and click on property search link.
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About the Author
About the author: Frank Kasper has retired after 21 years as an appraiser/real estate agent and now is a full time investor. To receive a free report and see what Frank uses when investing go to real estate, and
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