Pavilion from the Ocean

Pavilion from the Ocean

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The new look of luxe: Out-of-town buyers reshape real-estate design in Miami

Out-of-town buyers aren’t just snapping up Miami’s prime real estate — they’re also changing the way luxury developers build.
As more out-of-towners decide they want to put down roots in South Florida rather than simply buy investment properties for the rental market, they’re asking for bigger, better, more expensive designs. Units equipped with quarters for a nanny or maid. Guest suites for visiting relatives and friends. High-tech security with biometric identification.
Those requests come from both Latin Americans, who have driven Miami’s latest real-estate boom, and wealthy Americans, who are appearing locally in greater numbers. Some developers, hoping to lure a growing pool of Chinese buyers, are even turning to “feng shui” consultants who specialize in the eastern art of balanced design.
“Foreign investment has completely changed our entire landscape from an architectural standpoint,” said Daniel de la Vega, president of One Sotheby’s International Realty. “People are bringing their families here to spend time, and that changes their needs.”
One Sotheby’s now advises all developer clients building units greater than 3,500 square feet to include live-in quarters for a maid or nanny, de la Vega said.
At Paramount Miami Worldcenter, a luxury condo tower planned for downtown Miami’s Park West district, about 80 apartments out of a total 513 have a bedroom and bathroom — called a “lockout suite” — branching off from the main entrance near the unit’s private elevator. The studios, between 250 and 280 square feet, are envisioned as space for a maid or nanny, although they could also be used for teenage children who squawk for privacy or an elderly parent who needs quiet, said Peggy Fucci of OneWorld Properties, sales lead for the project.
Units with a lockout suite start at about $1.5 million, or $650 per square foot.

Miami home sales in June set 10-year record - Median price for homes grew almost 15% in June, year-over-year, to $280,000

Home sales in Miami scored a small victory last month, setting a new volume record for the past 10 years. June saw a total of 1,390 homes sold in the Miami market, an increase of 8.6 percent year-over year, and an increase of 80 homes from the previous record that was set in June 2005. The Miami Association of Realtors said in a release that this was the highest amount of homes sold in a single month in Miami’s history. So far this year, 7,100 single-family homes have been sold. The association said at this pace, the metropolitan area will also break its annual record of 13,521 sales that was set last year. The median price for homes grew almost 15 percent in June, compared to the same month last year. It now stands at $280,000, up from $243,700.

Despite this increase in sales activity, recent analyses have hinted at a slowdown in the market. Prices have ballooned due to consistent demand and a shrinking supply of houses for sale. On the flip side, Miami’s supply of condos has dramatically increased and the volume of sales has begun to ebb.

U.S. existing home sales near eight-and-a-half-year high

U.S. home resales rose in June to their highest level in nearly 8-1/2 years, a sign of pent-up demand that should buoy the housing market recovery and overall economy.
The National Association of Realtors said on Wednesday existing home sales increased 3.2 percent to an annual rate of 5.49 million units, the highest level since February 2007.
Existing sales this year are on track to record their biggest gain in eight years, the NAR said. May's sales pace was revised slightly down to 5.32 million units from the previously reported 5.35 million units.
Economists polled by Reuters had forecast home resales rising to a 5.40 million-unit pace last month. Sales were up 9.6 percent from a year ago.
June's solid home sales report came on the heels of last week's strong housing starts and building permits data. A tightening labor market is starting to push up wages, helping to boost demand for housing, especially among young adults. But supply remains a constraint.

The string of strong housing reports indicate the economy remains on firmer footing despite a drop in retail sales and a slowdown in job growth last month.


By Eric Glazer, Esq.

Although some Board members and unit owners often object, Florida community association law is clear, unit owners have the right to video tape meetings.

For condominiums:
FLORIDA STATUTE 718.112(2)(C) states: Board of administration meetings.—Meetings of the board of administration at which a quorum of the members is present are open to all unit owners. Members of the board of administration may use e-mail as a means of communication but may not cast a vote on an association matter via e-mail. A unit owner may tape record or videotape the meetings. The right to attend such meetings includes the right to speak at such meetings with reference to all designated agenda items. The division shall adopt reasonable rules governing the tape recording and videotaping of the meeting. The association may adopt written reasonable rules governing the frequency, duration, and manner of unit owner statements.

Rule 61b-23.002 of the Florida Administrative Code – (adopted by the Division, for Condominiums) provides:
(10) Any unit owner may tape record or videotape meetings of the board of administration, committee meetings, or unit owner meetings, subject to the following restrictions:
(a) The only audio and video equipment and devices which unit owners are authorized to utilize at any such meeting is equipment which does not produce distracting sound or light emissions.
(b) If adopted in advance by the board or unit owners as a written rule, audio and video equipment shall be assembled and placed in position in advance of the commencement of the meeting.
(c) If adopted in advance by the board or unit owners as a written rule, anyone videotaping or recording a meeting shall not be permitted to move about the meeting room in order to facilitate the recording.
(d) If adopted in advance by the board or unit owners as a written rule, advance notice shall be given to the board by any unit owner desiring to utilize any audio or video equipment.
(e) Unit owners are entitled to tape record or videotape board meetings and committee meetings occurring on or after April 1, 1992.

At least a dozen new South Florida condo projects in limbo amid changing market conditions

The future is in question for at least a dozen new condo projects that were originally proposed to be developed east of Interstate 95 in the tricounty South Florida region since this current real estate cycle began in 2011.
A growingly bearish sentiment for South Florida’s previously booming preconstruction condo market has emerged since the last winter tourism season ended and prospective domestic buyers returned north for the summer.
In their absence, developers are dealing with international investors who increasingly find themselves priced out of the South Florida condo market as preconstruction prices have surged to reflect higher construction costs and foreign currencies have fallen against the U.S. dollar as the global economy has slowed.
On a year-over-year basis, the dollar has risen significantly against the currencies of the countries from which the bulk of South Florida’s international buyers originate.
For example, the dollar is up about 11 percent against Argentina’s peso, 29 percent against Brazil’s real, 30 percent against Colombia’s peso, 19 percent against the euro and 40 percent against Russia’s ruble as of July 15, according to the currency conversion website
It is against this backdrop that more and more developers are opting to revise their original plans for preconstruction condo projects or even attempting to sell off their development sites.
The latest project in limbo is the planned 27-story Gulfstream Park Tower that was slated to feature 182 units in the expansive mixed-use retail and gambling facility in Hallandale Beach just north of Aventura.

Check Out The Median Rent In Your Miami Neighborhood

Rental start-up Zumper has released a map (scroll below) of the median rents across Miami neighborhoods, and concludes the Miami rental market has become the sixth most expensive in the country.
According to Zumper, the median price of a one-bedroom rental in the city — including apartments, condos, and rentals — $1,880.
Real estate analyst Jack McCabe says rental rates in the city are skyrocketing, increasing at near double-digit rates over the past year.
McCabe confirms the rates in Miami are some of the highest in the country, especially compared with the median household income in the city.
“Many people in Miami are heavily burdened by their household costs,” he says. “Almost 40 percent of the population is paying 50 percent or more of their income towards their housing expenses.”
He believes that if this trend continues, many young people may leave the area for other parts of the country that have a better standard of living.
The hottest neighborhood for rentals right now is Brickell, which McCabe says has gone in the past few years from being solely a workplace neighborhood, to a 24-hour “live, work, and play new urbanization area.”
The trendiness of newly developed neighborhoods like Brickell and Edgewater has even convinced some long-time residents of Miami Beach, the hot rental area over the past few decades, to move to the city, says McCabe. These neighborhoods provide Miami Beach expats with a similarly hip atmosphere at a slightly smaller price tag, although still high compared to the majority of the country.   Read More:

Foreclosure activity drops to record low

Foreclosure activity across the United States dropped to its lowest in a decade during the first half of 2015, according to data released Thursday.
A total of 597,589 properties were at some stage of the foreclosure process from January to June, said RealtyTrac, which tracks housing market trends.
Foreclosure activity, which includes foreclosure notices, scheduled auctions and bank repossessions, were down 13% from the second half of last year and down 3% from the same period of 2014.
Foreclosure starts fell 4% to 304,439 in the first half of this year, the lowest since RealtyTrac started tracking the data in 2006.
"U.S. foreclosure starts have not only returned to pre-housing crisis levels, they have fallen well below those pre-crisis levels and are still searching for a floor," said Daren Blomquist, RealtyTrac vice president.
Overall, 19 states, including California, Florida and Arizona saw foreclosure activity below or at the same level as 2006, before the economic crisis hit.
In June alone, 117,055 properties were at some stage in the foreclosure process, down 8% from the prior month, but up 9% from June 2014.
Lenders repossessed 36,503 homes in June, down 19% from May but up 36% from a year ago. June was the fourth straight month of annual increases in bank repossessions, which remained far below the peak in September 2013, when lenders reclaimed 102,134 properties.
Foreclosure starts fell 4% to 49,105 in June, but were up 4% from the same period last year, RealtyTrac said.
Atlantic City, New Jersey's financially distressed gambling hub, experienced the top metro foreclosure rate in the first half, with a foreclosure filing for 1.70% of housing units, or one in every 59.

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"First they came for the Socialists, and I did not speak out—
Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out—
Because I was not a Trade Unionist.

Then they came for the Jews, and I did not speak out—
Because I was not a Jew.

Then they came for me—and there was no one left to speak for me."

Pastor Niemöller  circa 1950

'A bloodbath’: Brutal summer spells doom for Miami restaurants

No one will tell you the restaurant business is easy. But it rarely seems this hard.
More than 20 high-profile restaurants have closed in Miami-Dade in recent weeks, outpacing the clip of new openings and putting operators on edge as they head into the year’s slowest months.
The closures have snuffed out restaurants big and small — from a celebrity chef’s 400-seater in South Beach (Siena Tavern) to a mom-and-pop seafood spot in North Miami (Fish Fish) — at various price brackets and serving all kinds of food. No place, it seems, is immune.
“It’s a bloodbath,” said Chris Sommers, co-owner of Pi Pizzeria, a St. Louis-based chain that closed at 124 Collins Ave. in Miami Beach last week after fewer than three months in business.
“Our timing was bad, opening with the start of the slow season, but this is obviously unusual,” Sommers said. “Perhaps we could have persevered to the high season, but the high season would have needed to be so high to offset this incredible low. We decided to cut our losses and reinvest in another store near Washington, D.C.”
Only two of more than 20 restaurants that have shut here since May 1 had been open longer than five years: Maiko Sushi, which opened in 1992 at 1225 Washington Ave. in Miami Beach and closed last month, and Romeo’s Cafe, which opened in 1998 at 2257 SW 22nd St. in Miami and closed in May.
Rising rents and South Florida’s tourist-reliant seasonal economy are often cited as reasons for restaurant failures, but industry observers say some restaurateurs simply create bad concepts, pick lousy locations or have poor execution.

Read more here:


By Eric Glazer, Esq.
            When the foreclosure crisis was at its peak, developers were complaining that they were in effect stuck with numerous condominium projects that simply weren’t selling.  They wanted the ability to at least try and save the project by converting it into a rental community instead of being forced to maintain it as a condominium. The problem was what to do about those pesky people who actually did buy a unit in the condominium and were now demanding that the condominium remain as a condominium and the developer fulfill all of the developer’s obligations.

            I know this is hard to believe, but The Florida Legislature helped out the developers in a big way.  Despite the fact that the law always required a condominium to be terminated with a 100% vote of the owners, The Florida Legislature passed a new law that now allowed for termination with an 80% vote.  Since the developer was normally stuck with at least 80% of the units, termination was now easy.  In effect, the statute allowed the developer to now repurchase the units they sold to the initial few and kick the owners to the curb.  So, you would think they get all their money back right?  No.  Under the new termination provisions, the developer was only required to repurchase the units for as little as what the county now appraised them for.  So, these people paid full price, paid their mortgage each month, paid their assessments and were getting kicked out anyway and forced to sell at tremendous discounts.  
            It gets worse.

            People like Jan Bergemann warned that this new law would allow any other investors to gobble up units in even successful condominiums, and once they own 80% of the units, terminate them as well.  While the statute was certainly meant to get developers out of a condo project doomed for failure, the new law could also be used by investors seeking to turn a successful condo into a more profitable rental community.  The Florida Legislature didn’t heed these words.  Until now.

            After much publicity in the media, effective July 1st the “termination” law has finally changed.  A developer can still terminate with an 80% vote, but not if ten percent of the owners vote in opposition to the developer’s termination plan.  In addition, developers must pay the owners fair market value for their unit as determined by an independent appraisal and a relocation fee. The termination plan must also provide that the first mortgage is paid in full for all units being purchased under the termination plan.
            It only took a couple of years to stop the damage to Florida condominium owners.  Developers literally get relief overnight however time and time and time again.

In Miami luxury market, single-family home resales outpace condos

A split emerged in Miami’s luxury real estate market during the first three months of 2015: Resales of single-family homes chugged along at a steady clip, but the market for existing luxury condos peaked as sales slowed and units stayed up for sale longer.
The number of luxury single-family homes sold grew 2.3 percent in the first quarter of 2015 compared to the same quarter last year. But luxury condo resales were down 3.6 percent over the same period.
Those numbers come from a report released Wednesday by the Miami Association of Realtors. “Luxury” sales are those that break the $1 million mark.
Existing condo sales are slipping in part because of the number of new towers going up. The new amenity-laden units are siphoning luxury buyers away from the resale market.
But prices for resales also may have surged too high.
The median sales price for a luxury condo resale was $1.7 million in the first quarter of 2015, up from $1.5 million in the first quarter of 2014. That’s a 13.3 percent spike.
...the economic downturn in Latin America and a strong dollar are also contributing to the slowdown.
As a result, owners are having a harder time selling their units. Luxury condos stayed on the market for 103 days during the year’s first quarter, a 15.7 percent increase from the first three months of 2014.
Abundant inventory is a concern, too. The number of luxury condos on the market rose, growing 8.1 percent year-over-year.
Luxury properties stayed on the market for 94 days in the first quarter of 2015, unchanged from the year before. Median sales prices grew to $1.7 million, up from $1.6 million.
But supply also is growing for $1 million homes, as sellers sense a favorable market. The number of new listings went up 22.4 percent.
The number of new homes for sale is slowing price growth.