World’s Prime Real Estate

Over the past 20 years, I have been fortunate enough to have traveled far and wide and visit many countries and major cities. Recently, I read the Wealth World Report 2009 compiled by Knight Frank, which presented The Global Top Ten of residential real estate.

Not to say that I have personal knowledge of real estate in many major financial centers in the world, but this survey revealed some incredible residential real estate numbers in comparison to the Miami market. Miami clearly did not rank in the Top Ten in terms of price per square foot, not even close. However, the survey did reveal that you will pay through the teeth to live in many of the globe’s financial centers, and comparatively speaking, prime real estate in Miami Beach is  simply a  fraction of the cost.

This survey revealed the following average prices for the world’s prime real estate as follows:

 

The survey also ranked the World Top Cities based on four criteria; Economic Activity, Political Power, Knowledge and Influence, and Quality of Life. While London, New York, Paris, Tokyo, and Los Angeles, rounded out the top five, Miami ranked 29th out of 40. Although the “Quality of Life” ranking for Miami was a dismal 31 as compared to LA’s score of 9, which I definitely question, I think that our presence in the top 40 is an achievement for our city.

I say it to our clients over and over again, you cannot compare the value that you can buy in Miami today to that of ten or twenty years ago. Additionally, when considering the cost of luxury Miami Beach real estate versus some of these major cities, the price of your second home is even more attractive than ever.

Florida’s Property Tax Conundrum

Working with buyers of Miami residential real estate can be a lot of fun and full of adventure. We have so many unique neighborhoods, eclectic architectural styles, and such a diverse culture, including homes from tropical bohemian bungalows in Coconut Grove to high-tech modern waterfront homes on the Venetian Isles. Eventually, however, you have to cross that shaky old “real estate tax” bridge. PROPERTY TAXES ARE WAY TOO HIGH, and are a major factor in the property buying decision process.

YES, prices have come down considerably, and in some cases way below the threshold that any of us in this business imagined. Fantastic, that $2.1 million home in the Grove is now available at $850,000!

YES, unless you are in the $5 million and up range, there is a huge inventory of properties to choose from across the board. Superb, short sales and foreclosures galore!

YES, with only a minimum required down payment of 3%, attractive FHA financing is available. Wooohoo, my bank offered me is an amazing rate of 5.5% on 30YR fixed rate mortgage!!

SAY WHAT? Although my purchase price is $129,900 and I am purchasing a wonderful foreclosure property at 40 cents on the dollar, the property appraiser is not going to adjust my market value down to the purchase price in 2009!

According to the Miami Dade Property Appraiser, the current market value of this home is $322,205, and the 2007 real estate taxes were $8,113. This means that I am required to pay as much in real estate taxes as in principal and interest. Does that sound reasonable and workable to ANYONE?

There is some silver lining in this box. Several proposals are out there to drastically reduce the cost of real estate taxes in Florida. People we need to get with the program and talk to our Florida legislators. Check out one proposal out there called Cut Property Taxes Now, for example. They propose capping property taxes to a maximum of 1.35% of market value.

No matter which direction you think best, let your voice be heard and let’s push for CHANGE!

If you would like a FREE consultation on the value of your property or to discuss your real estate tax situation, please feel free to send us a request at info@miamiangelproperties.com or call Ross at (305) 673-5300.