Miami Beach Waterfront Homes Blog

I’d like to share my most recent experience with Buyers looking to purchase a Miami Beach luxury home located on the water with the following criteria:

Price: $4M – $6M
Approx Size of Home: 3,500 SF – 5,000 SF (Four bedroooms preferred)
Contemporary Design / Decor
Preferred Minimum 100′ of water frontage
Room for Pool (if none currently)
Island Communities Targeted: Palm Island, Hibiscus, Venetian Islands, Sunset Islands, North Bay Road Homes

In order to preserve the Buyers confidentiality with the specific homes that we’ve been negotiating, I’m going to focus on the issues that have come up in the negotiations/purchasing process which are unique to today’s economic and financial situation.  This is the third set of buyers that I have worked with in the past year that have insisted on ordering an Appraisal (at Buyers expense) BEFORE making a written offer.  This demonstrates the importance of a serious seller today pricing their home correctly.  Given that we are in a Buyer’s market, and especially in light of the financial turmoil of the past two years, any serious buyer wants to be CERTAIN that they are getting a reasonable deal on a home purchase.

I’m often hearing talk these days about the real estate market in Southeast Florida “turning around”.  This means many different things- most significantly, in concrete terms what I’m seeing is more liquidity in the market today for qualified buyers.  Specifically, those looking to purchase a home with the above mentioned criteria, to obtain a 75% loan to appraised loan to value mortgage (for qualified buyers) is a relatively straight forward proposition for a luxury home in Miami Beach.  However, to obtain a construction loan or to be able to pull equity from a recently purchased property is NOT so easy, if not exceedingly difficult or downright impossible!

This is significant for sellers to take into account, because what it means going forward is that if a property does not appraise, it will most probably not sell for the foreseeable future.  In today’s market environment, even the “cash” buyers are insisting on getting proof of fair market value by way of an appraisal.  This is a relatively new phenomenon, which I encourage every Miami Beach home seller to be aware of!

According to University of Florida oceanographic reports over the past few days, the east coast of Florida is at some risk for contamination from the leaking BP oil rig in the Gulf of Mexico.

Based current models, the expanding oil slick could get caught in a loop current which would redirect it to the Florida Straits, up into the Gulf Stream, and ultimately up the east coast of Florida.

The many waterfront Estates and Luxury homes on Key Biscayne and Fisher Island would be especially vulnerable to contamination.  These islands have direct exposure to the Atlantic Ocean and are considered much more vulnerable to potential contamination.

The island communities off of Biscayne Bay, however, such as the Venetian Island chain, as well as Palm Island, Star Island, Hibiscus Island, and Sunset Islands are thought to be much better protected, as they are located inside several protective barriers.  In addition, if oil slicks were to be spotted, several Coast Guard stations have been pre-stocked with rubber barriers that would be deployed helping to stop oil from contaminating the Biscayne Bay island communities.

Closed in March, 2010, this beautiful non-waterfront home and was on the market for just 12 days!  Located on Sunset Island II across from the park. This Estate-type home has hardwood floors throughout, a two story foyer, living room with fireplace, formal dining room, theater room, wood paneled library, gourmet island kitchen with professional appliances & breakfast area. Family room opens to covered covered loggia with summer kitchen; surround sound, heated pool, master suite w/marble bath & walk-in closet, large sundeck, maid’s quarters, lush landscaping, converted garage, corner lot.

Sunset Island #2 is connected to Sunset Island #1, with a private, 24 hour guard gated entry via Bay Road in Miami Beach.  Sunset Islands I and II are known as the most exclusive estates of the four Sunset Islands chain.

Sold Price: $2,050,000
Original “For Sale” Price : $2,300,000 (2/2010)
Bedrooms: 4
Bathrooms: 5
House S.F.:4,455 ($460/SF)
Land S.F.: 12,500  ($164/SF)
Sold Date: March 18, 2010
Discount from Asking Price: 10.8%
Days on Active Market: 12

In the past six months, Miami Beach has witnessed a resurgence in sales activity for price reduced waterfront single family homes.  I’d like to highlight a recent sale on Miami Beach’s Sunset Island IV.

This sale is significant for me personally, since this it’s a home that I sold in 2005.  It illustrates the amazing value that a qualified buyer will be able to get for a premium waterfront home on a guard gated island community in Miami Beach.  The two southernmost islands of the four are Sunset III and IV. Magnificent sunsets can be seen from some of the Sunset III and IV homes. These two islands are connected to South Beach and are a five minute walk from Lincoln Road.

1450 West 21st Street (Sunset Island IV)
This is a two story waterfront home on Sunset Island facing towards the Sunset Harbour townhomes in South Beach.  This custom designed charming home features an oversized master bedroom.  Home was in need of an update, as the finishes were from the early 80’s.  60 linear feet of water frontage with dock.

Sold Price: $1,300,000
Original “For Sale” Price : $2,300,000 (6/2009)
Previous “Sold” Price (6/2005) : $1,950,000
Bedrooms: 4
Bathrooms: 4
House S.F.: 3,265 ($597/SF)
Land S.F.: 8,700 ($149/SF)
Sold Date: February 16, 2010
Discount from Previous Sales Price in 2005: 33%

Everyone keeps asking – how long until the market recovers? Particularly if you are a seller today, a better question to ask is how the Miami Beach Real Estate market has actually performed over the past two months. I’m not going to mince words here, the reality is that the mortgage and real estate crisis is having a strong downward pressure on prices (yes, even in South Beach).  The strongest pressure, however, is occurring on the lower and middle range of the Miami Beach homes market.    The high end of the residential market, particularly for completely remodeled and turnkey waterfront island homes, continues to experience strong demand and remains relatively insulated from the current financial crisis.

If you are a potential seller, all is not lost and now is when when savvy buyers are purchasing spectacular waterfront properties in Miami Beach (such as Palm, Star, Hibiscus, Sunset, and the Venetian Islands).

As a reality check, let’s take a look at the latest closed sales of single family waterfront homes and non-waterfront foreclosure homes in Miami Beach:

The Venetian Islands

Venetian Islands Home - Kitchen

This completely updated 3,500 sq ft 3 bed/3.5 bath home features: Downtown Miami & sunset views on open water bay view on a 11,375 sq ft lot has 65 ft water frontage
Asking Price:  $4,495,000
Sold: $3,700,000 ($1,057/SF house)  ($325/SF land)
Closing Date:  12/30/08

Palm Island

Palm Island

This private Mediterranean estate boasts spectacular bay & downtown Miami skyline views, resort-style pool and 4-car gar. Lavished w/exquisite Old World details, the interiors have soaring ceilings, fine inlaid marble, hardwood flrs, exquisite moldings, custom blt-ins, columns, arched windows. Dockage for the yacht of your dreams with water frontage of 100ft.
Asking Price:  $10,900,000
Sold: $9,750,000 ($1,227/SF house)  ($325/SF land)
Closing Date:  9/11/08

Sunset Island I

Sunset Island Home

165 feet of open bay frontage and direct access to the Atlantic Ocean and 37,578 sq ft of property, this home offers expansive views, resort-like pool deck and spa, and oversized master bedroom & bath.
Asking Price: $8,900,000
Sold: $6,250,000 ($945/SF house)  ($166/SF land)
Closing Date: 12/23/08

Miami Beach

Miami Beach Home

Remodeled with updated kitchen and granite counter tops & stainless steel appliances, arched doorways and terracotta tiles.  New roof and windows with lush tropical landscaping with privacy for homeowners.
Orginal Asking Price:  $1,175,000
Foreclosure Sold Price: $350,000 ($179/SF house)  ($46/SF land)
Closing Date:  12/24/08

As the last example above illustrates, in a market that’s still in decline, the market reality between the upper and lower end of the residential real estate market is significant!