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I think problem with rent is that's an extra time that you have to move stuff. That's not easy unless you're a college freshman. Besidedls personal stuff, I require a professional office with high speed internet at home. Also even if everything is overpriced now, you have those low rates, no one is putting $500k cash when u can lock in sub 3%.
Miami has always had a lot of cash real estate deals. There are investors.Foreign money laundering. Wealthy people wanting to homestead property protection from creditors/bankruptcy or just because a mortgage is a nuisance at a certain amount of wealth and they don't want to go through the hassle.
I was looking at recent statistics and came away with 31% cash sales...but in the past I remember it being more than 50% especially after the last housing bust/recession.
Miami has always had a lot of cash real estate deals. There are investors.Foreign money laundering. Wealthy people wanting to homestead property protection from creditors/bankruptcy or just because a mortgage is a nuisance at a certain amount of wealth and they don't want to go through the hassle.
I was looking at recent statistics and came away with 31% cash sales...but in the past I remember it being more than 50% especially after the last housing bust/recession.
How much it cost to maintain 500K condo in Miami Beach.
Property Tax = 2% = $10000/year
HOA fees = $ 10000/year. I am assuming these are well kept HOA as I have been seen in listings 500K condo with $1000+ /month HOA fees Small Maintenance/repair + HO6 insurance + Utility =$10000 /year
So basically I am looking at $40- 50k/year in housing cost for a $500K Condo in Miami Beach and this is without mortgage and assuming no big damage such as hurricane or flood or special assessment.
Is my assumption/math more or less within range?
No, you're way too high on the bolded part above. An HO6 policy should cost you less than $2,000yr and your FPL bill for electricity should be more or less in the neighborhood of $1,000. Your other utilities (water, trash, Internet/cable) should be included in your monthly HOA fee (especially if you're assuming $1k/month). Any interior maintenance/repair bills you have should be minimal, especially if you're in a newer building.
Quote:
Originally Posted by BlackTee
I've been researching condos also and this agrees with what I am seeing. I am not sure if "hurricane insurance" is separate from "home insurance"- which is standard insurance against your neighbors flooding your apt or you starting a fire in your home. But this "home ins" comes out to $500-800/month. If hurricane is separate then you might have to double that. These fees are indeed very high. And if you buy a sfh the only difference is the lack of hoa. At least with a sfh you could try to recoup some of those fees when you are on your vacation via short term rental. Supposedly one plus of miami is year round tourists, though I am not sure how popular it is june-september. It stormed just a little past 2 days and swimming was not pleasant because of the seaweed. Miami beaches are distinguished by clear water, but I think that's only true october-april.
I think you can find condo rentals on the beach for cheaper than buying. But some of those costs will keep getting passed to the renter. Btw if (hoa+home ins+tax)/price keeps getting higher, it is a setup for problems.
With all due respect, you need to do more research. First of all, "hurricane insurance" (actually windstorm coverage) is not a separate policy from "home insurance," although it is a separate provision in your regular home insurance policy with a separate deductible. And keep in mind that it is damage caused by wind, not any associated flooding. If you're in a SFH, you need a separate flood insurance policy; if you're in a condo, flood insurance is covered by the master association, the cost of which is included in your monthly HOA fee.
Secondly, your insurance costs are way off for what a condo owner would need to pay. Your $500-$800/month example is more akin to what an HO3 policy costs to insure a SFH. If you purchase a condo, then you need an HO6 policy, which should run no more than $150-200/month. In fact, I paid less than that much for my oceanfront condo over the past 9 years.
And that leads into the third point: there's more of a difference between owning a condo and owning a SFH than simply the HOA fee. And you can start with the significant difference in cost between an HO3 and an HO6 insurance policy. Another big difference is the upkeep involved, in both time and money. And, as I pointed out in my answer above to the OP, that HOA fee also can cover utilities and other items such as garbage, trash, water, cable, WiFi, etc., that you'll have to pay for yourself in a SFH. And you can add the cost of a monthly fitness center fee as well,
Up until last month, I owned both an oceanfront condo on Miami Beach and a single family house in the City of Miami, so I think that makes me somewhat qualified to discuss both the pros and cons of both types of ownership, as well as how the costs differ.
No, you're way too high on the bolded part above. An HO6 policy should cost you less than $2,000yr and your FPL bill for electricity should be more or less in the neighborhood of $1,000. Your other utilities (water, trash, Internet/cable) should be included in your monthly HOA fee (especially if you're assuming $1k/month). Any interior maintenance/repair bills you have should be minimal, especially if you're in a newer building.
With all due respect, you need to do more research. First of all, "hurricane insurance" (actually windstorm coverage) is not a separate policy from "home insurance," although it is a separate provision in your regular home insurance policy with a separate deductible. And keep in mind that it is damage caused by wind, not any associated flooding. If you're in a SFH, you need a separate flood insurance policy; if you're in a condo, flood insurance is covered by the master association, the cost of which is included in your monthly HOA fee.
Secondly, your insurance costs are way off for what a condo owner would need to pay. Your $500-$800/month example is more akin to what an HO3 policy costs to insure a SFH. If you purchase a condo, then you need an HO6 policy, which should run no more than $150-200/month. In fact, I paid less than that much for my oceanfront condo over the past 9 years.
And that leads into the third point: there's more of a difference between owning a condo and owning a SFH than simply the HOA fee. And you can start with the significant difference in cost between an HO3 and an HO6 insurance policy. Another big difference is the upkeep involved, in both time and money. And, as I pointed out in my answer above to the OP, that HOA fee also can cover utilities and other items such as garbage, trash, water, cable, WiFi, etc., that you'll have to pay for yourself in a SFH. And you can add the cost of a monthly fitness center fee as well,
Up until last month, I owned both an oceanfront condo on Miami Beach and a single family house in the City of Miami, so I think that makes me somewhat qualified to discuss both the pros and cons of both types of ownership, as well as how the costs differ.
A lot of the realtor ads dont list the numbers for insurance, but I specifically looked up the ones that do, for example in oceania 1, trump royale, millenium (and not every realtor site lists it), it is in the lower range of that 500-800 that I listed above, i.e. 500 for 500k and 800 for 800k$ condo. I did not notice much of a difference in the home ins between those buildings. Can you explain how you are getting 2-3x less than that in an oceanfront building? I just dont think any realtor would mistakenly advertise higher insurance than what u have to pay. Indeed I did not think of the added expense of flood insurance for a house, and it seems if the house is in the 10/10 flood zone, besides the insurance it just makes it too much of a hassle to own such a sfh (I once had to deal with a flood and while I got completely reimbursed I still wouldnt r4commend).
I am now thinking of condo-hotels versus sfh more inland to avoid flood. But I think the only reason to live in florida is to be walking distance to a swimmable beach.
A lot of the realtor ads dont list the numbers for insurance, but I specifically looked up the ones that do, for example in oceania 1, trump royale, millenium (and not every realtor site lists it), it is in the lower range of that 500-800 that I listed above, i.e. 500 for 500k and 800 for 800k$ condo. I did not notice much of a difference in the home ins between those buildings. Can you explain how you are getting 2-3x less than that in an oceanfront building? I just dont think any realtor would mistakenly advertise higher insurance than what u have to pay....
I'm not sure what criteria those sites are using. But in any event, where the condo is located is pretty much irrelevant. Keep in mind that the master policy is responsible for repairing any damage to the building itself and that your HO6 policy only covers from the interior walls inward. In other words, appliances, cabinets, fixtures, drywall, painting, and whatever personal property coverage you want added. All I can tell you is that my condo was north of the OP's price point of $500k and I wasn't paying anywhere near those prices. In fact, here is an exact delineation of the annual charges:
As you can see, even in the most expensive year I was paying less than $150/month. Now the HO3 policy for my SFH in the City of Miami about a mile from Biscayne Bay is more in the range of what you're talking about. I'm currently paying $7,065/yr (589/month)for my Citizens HO3 policy plus another $516/yr (43/month) for my FEMA flood insurance policy.
So basically $632/month to insure my SFH as opposed to $116/month for the current year's HO6 condo policy. And the market value of my house is pretty much equivalent to the market value of my condo.
A lot of the realtor ads dont list the numbers for insurance, but I specifically looked up the ones that do, for example in oceania 1, trump royale, millenium (and not every realtor site lists it), it is in the lower range of that 500-800 that I listed above, i.e. 500 for 500k and 800 for 800k$ condo. I did not notice much of a difference in the home ins between those buildings. Can you explain how you are getting 2-3x less than that in an oceanfront building? I just dont think any realtor would mistakenly advertise higher insurance than what u have to pay.
'Realtor' websites aren't designed to give you insurance costs. The cost is determined by the unit itself and the insurance company.
Agree with everything Bethesda said above regarding costs and insurance. Condo insurance is very cheap, not $6000+/year!
Also I'm glad he pointed out the 'HOA $ waste of money' fallacy. Add up your water,sewertrash bill in City of Miami each year. Add up your landscaping company you pay for. Add up your monthly internet and Cable bill. Compare the difference in your electric bill each year from a house vs a condo. Add in your gym cost like he said. Did you build a pool? Add another $100-$200/mo for maintenance and pray the pump doesn't break or your screen doesn't get ripped a part when a July average storm comes through. Then add up the difference in your HO6 policy vs HO3 policy each year. In the end, you might be losing $ owning a house or maybe saving $100-$200/month. IF you move into a fancy building, of course you're paying more. If you want a 'SNOW ROOM', then move into 10Museum Downtown. if you want a movie theatre and bowling alley, well you can have 1010 brickell. Its all personal preference and 'you get what you pay for'
Ok thank you, I guess my # were wrong. I am surprised that flood insurance would cost less than $50 for a house in the flood zone. The only time I(my parents) ever had to use a home insurance in ny was for a flood and it was big.
Ok thank you, I guess my # were wrong. I am surprised that flood insurance would cost less than $50 for a house in the flood zone. The only time I(my parents) ever had to use a home insurance in ny was for a flood and it was big.
Although I live less than a mile from Biscayne Bay, my house is classified as being in Zone X which is not a flood zone. If you're wondering why I nonetheless decided to purchase flood insurance, keep in mind that such insurance covers any water that enters the house from the outside; be it from flooding from a heavy thunderstorm, broken mains, etc. Regular homeowners' insurance policies specifically exclude damage caused by all such water/flooding.
As you can see, it is relatively inexpensive to carry flood insurance if you are not in a flood zone; that's why I recommend that all homeowners should carry it. Ask the Houston homeowners who've lost their homes due to Hurricane Harvey and other significant storms over the past few years if they wish that they had spent $500 to purchase flood insurance. The majority of homes that were flooded were not in flood zones and the majority of those homeowners had not purchased flood insurance because it wasn't required by their mortgage companies.
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