Well friends, here the 1Q scoop. The graph above shows us the Miami Beach condo inventory (33141 waterfront) for sale throughout 2007 into this first quarter 2008. Notice the inventory heading up then down. This may signify the market inventory improving. I’ll be watching this closely in Quarter 2, 3 and 4 to see if we really have reached the bottom and will be keeping you informed through the MiamiBeachRealEstateBlog.us
This graph above is also crucial to understand. What we are reviewing is the average time on the market for condos that HAVE SOLD. The next crucial indicator is the Sold Price to List Price Ratio which shows us an average of 90%+ of list price. The later part is important for today’s buyer’s to understand…This oceanfront entity of Miami Dade County is specifically Miami Beach. The demand is and will always be Miami Beach OCEANFRONT, Duh! This graph also includes Bay front condo sales but what I’m going to repeat over and over is that well price properties… let’s call them “Deals, Bargains, Steals, Foreclosures, Short sales,” or whatever it is that your query for a “good deal” constitutes, are indeed selling at 90%+ of the list price.
L1. It’s fairly plain and simple that there are no “good deals” at 30, 40 or especially 50 cents on the dollar unless you factor in what the value was in 2005 and then getting close. This oceanfront segment of the market has in fact depreciated 25% since the market peaked in 2005. If you think time is on your side in finding this type of mark down, then you may be waiting and may never own in Miami Beach. You may also explore my friend Lucas at MiamiCondoInvestments.com for something great in Downtown Miami.
L2. For those that need financing… as interest rates rise, you may find yourself priced out of the building that you could afford today. With a 2% rise in the interest rate, your $400,000 loan just went from $2,359 (5.85%) to $2,893 (7.85%) for an additional $534 monthly expense. Will this happen? You better count on it as the Fed’s are placing a band aid on an open wound.
L3. If you are previewing the 1 to 3 of the very best “Deals, Bargains and Steals” of a condominium meeting your overall criteria and the best priced condos are at $450,000 to $500,000 range while recent comparable closed sales are showing 3 sales at, let’s say $550,000, $565,000 and $599,000, it will be very unlikely (sometimes insulting) that the owner will take $300,000! The best I’ve seen around the block and saved my customers this year is 16% and it was a cash offer with 7 day closing.
L4. You MUST first know it’s a BARGAIN when previewing the building by reviewing a comparable closed sale report provided by an area expert and proving it’s a great buy. Understand this last part and make sure your agent shows you both MLS and privately closed sales.
The moral of this blogory is Miami Beach real estate has great opportunity with today’s excessive Miami Condo inventory to get a you a “Deal, Bargain, Steal” on your terms when a “reasonable” offer is presented. Reasonable is 10 to 20% off the asking price at best depending on your financial capabilities, sale contingencies and closing time frame. Feel free to comment on your thoughts related to this blog. Myself and the many readers would love to hear from you! I continually add to my Miami Beach real estate blog, and once you visit, you can be notified by email or by RSS feed (upper right column) each time I post a new article.