Miami is on Sale for Foreign Buyers
With the continued depreciation of the U.S. Dollar and the realization that attractive real estate in Miami is relatively cheap by international standards, the activity level of foreign national buyers purchasing prime Miami real estate is going to continue to increase. You may argue that the dollar is going to continue to devalue, and you may be right. However, for the average investor, there is no better hedge to a devaluing currency or inflation, than real estate.
There have been several encouraging transactions in the bulk condo market these past few months. The sale of the Caribbean condo project, located at 3737 Collins, by Corus Bank to a New York investor was just one of these recent key transactions in the market. According to several sources, the original mortgage of $127.7 million on this 103-unit luxury oceanfront condo project, was sold for approximately $320 per square foot, or at a discount of over 50 percent.
In anther recent deal, Hyperion Onyx Partners, a local development and management company, purchased the outstanding construction on the 28-story Onyx on the Bay condominium in downtown Miami. Hyperion Onyx Partners, paid an undisclosed price for the note securing the remaining unsold 40 units, which is rumored at $155 per square foot and represents an approximate 50 percent discount over the original note at $303 per square foot.
A number of local condo developers are working out deals with their existing lenders to offer attractive financing to purchasers of the unsold developer units in their projects. Canyon Ranch Living in Miami Beach, Asia on Brickell Key, and the Mei in Miami Beach, are three such examples.
According to an article published by the South Florida Daily Business Review, Lehman Brothers has plans to help fund up to $200 million of individual condo mortgages for buyers of the 580-unit condominium project. Americor Mortgage of Birmingham, Michigan, is responsible for originating the purchase money mortgages, which they will then sell to Lehman Brothers. At the Mei in Miami Beach, the developer is offering a seller financing package to purchasers. Progams are either a 5 YR or 7 YR ARM, with 65 percent or less loan-to-value ratios, and interest rates in the high 5’s to mid 6’s.
The abundance of these recent bulk condo sales and the willingness of banks to sell loans at such large discounts is helping to set a floor under the new construction condo market, and in particular, in several projects where these transactions have taken place. While the number of re-sales in the luxury condo market are at very low numbers compared to the boom years, the level of interest in this segment is definitely increasing along with the number of closed sales.
It is encouraging to see this trend emerging, and even more exciting to see the level of foreign interest increasing in our incredibly diverse real estate market. With the Euro currently trading at $1.46, or the Brazilian Real trading at $1.79, the opportunity to acquire a second home or investment property in Miami is now!
Are you looking for a Miami or Miami Beach property at a deep discount? Are you looking for a discounted short sale or bank owned property? Ross Milroy of Miami Angel Properties, LLC may be reached at 305-673-5300 or info@miamiangelproperties.com.
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