Miami Beach Real Estate Blog

The Obama administration has finally begun to crack down on mortgage companies and loan servicers that are failing to do enough to help borrowers at risk of foreclosure.  Measures announced this week include sanctions and fines that will be imposed via the Treasury Department.  According to a random survey of approximately 50 of our clients who purchased property in Miami Beach after 2004, we have roughly estimated that only 25% of eligible borrowers who purchased premier waterfront properties in Miami Beach have been able to permanently modify their loans.

As part of the various Homeowner Relief Programs being advocated by policy makers in Congress, The Treasury Department, and The Obama Administration, over 35,000 homeowners received letters during the summer of 2009 from the Federal Regulators–offering them a new, more affordable mortgage payment. However, the real problem seems to be the bureaucratic bottleneck, disorganization, and lack of accountability on the part of loan servicers and banks.  In the past two weeks alone, I have had four separate clients tell me that their loan modifications have either been denied due to lost files, incomplete paperwork (because a form changed from time of application), and general lack of responsiveness and policy confusion from lenders.

The Federal Deposit Insurance Corporation (FDIC) is offering many delinquent borrowers significant concessions on past due mortgages–in many cases lowering interest rates to as low as 3%, extending loan amortizations schedules from 30 to 40 years, waiving traditional qualification requirements, and keeping payments under 38% of a borrower’s gross income.  Many Miami Beach homeowners who currently find themselves “underwater”, which is defined as owing more than the property is worth in today’s market, are anxious to participate in the loan modification programs.

Our sampling of Fortune International’s clients includes those that purchased a waterfront property as their primary residence on Sunset Island IV, Palm Island, Biscayne Island, and in Miami Beach condo buildings including The Murano at Portofino, The Portofino Tower, The Bentley Bay and The Continuum South Tower. Approximately 65% of those surveyed indicated a willingness to stay in their homes, as long as they were successful in lowering their monthly mortgage payments and bringing their cost of owning closer to the cost of renting a comparable property in Miami Beach (whether it be a condo or single family home).

As part of my marketing strategy of the past few years, I travel regularly to international real estate trade shows and meet with Brokers from around the world.  I’m usually asked about the state of Miami Beach luxury real estate (especially demand for waterfront single family homes).  Those with the financial resources (both from USA and International clients) ask about the possibility of purchasing a foreclosed, or bank owned, single family home in Miami Beach.  There continues to be a significant gap between the sought-after upper end luxury market and the less desireable, and generally non-waterfront properties.  Although waterfront luxury home sales are down significantly for Miami Beach overall (around 50% for first half of 2009), we’re seeing sales activity for turnkey homes that have come down in price significantly.

The most recent closed sales of waterfront homes in Miami Beach:

2046 North Bay Road Luxury Mansion – Drastically Reduced Waterfront Estate

2046 N.Bay Raod, Miami Beach

This was the best luxury waterfront deal in Miami Beach.  Priced to sell after being on the market for over 1,000 days! Featuring a private guard house – 80 ft infinity pool & private beach – elevator – generator – 4 car garage and much more.  This waterfront estate was featured on PlumTV.

My opinion as to why it sold :  Amazing architectural style & location on prestigious North Bay Road, amazing views, price reduced aggressively with lender approval.

Sold Price: $9,750,000
Original “For Sale” Price : $17,000,000 (5/2006)
Bedrooms: 7
Bathrooms: 11
House S.F.: 14,582
Land S.F.: 38,314
Sold Date: October 8, 2009
Discount from Asking Price: 42%
Search: North Bay Road Homes For Sale

The Venetian Island

127 East Rivo Alto, Miami Beach

Priced right!  Located on the best of the Venetian Islands-Rivo Alto Drive -and far in from the Venetian Causeway that links Miami and Miami Beach.  This 2 story home offered Frank Lloyd Wright inspired architecture. Open Floorplan, WATER VIEWS throughout, Updated Kitchen with high end appliances and well maintained bathrooms. Large backyard and pool which are perfect for entertaining or relaxing.

My opinion as to why it sold :  Great waterfront location, spacious floorplan, price reduced quickly and aggressively!

Sold Price: $2,040,000
Original “For Sale” Price : $2,590,000 (3/2009)
Bedrooms: 4
Bathrooms: 3
House S.F.: 3,361
Land S.F.: 10,500
Sold Date: October 16, 2009
Discount from Original Asking Price: 21%
Search: Venetian Island Homes For Sale

Hibiscus Island- Reduced Turnkey Waterfront Home

320 S. Hibiscus Dr, Miami Beach

This home has scenic bay and city views, tri-level and perfectly updated with attention to details.  Featuring marble and wood flooring throughout, with gourmet kitchen, stainless steel appliances, a beautiful and contemporary salt water bayfront pool, large master suite on the top level with incredible water views.  Two car garage, and ideally located on a quiet section of Hibiscus Island.

My opinion as to why it sold :  Great waterfront location in 24 hour guard gated community, amazing views, price reduced aggressively.

Sold Price: $2,500,000
Original “For Sale” Price : $3,250,000 (6/2008)
Bedrooms: 3
Bathrooms: 4
House S.F.: 3,590
Land S.F.: 10,500
Sold Date: September 29, 2009
Discount from Original Asking Price: 23%
Search: Hibiscus Island Homes for Sale

Source:  South Florida Regional MLS

Browse: Miami Beach Luxury Real Estate