Real Estate Upturn? (Miami: for sale, foreclosure, renters)

[joe33141]

Any ideas on when the market might reset itself?

I live on the north end of Miami beach. I paid 270k for a remodeled 2/1 three blocks from North Shore Open Space Park. I have to move to Portland, Ore.

I think it's possible to sell the unit for 235k with all my furnishings.

But, I'm considering holding on to it despite the fact that the rent (if I rent it) will cover about half my mortgage. Needless to say, I'm well upside down in it.

If the market turns in three years I'll have spend about 43k to hold onto the place to maybe sell it at what I originally bought it for. But I'm also looking at the possibility of it going without renters for periods of time and having to make repairs.

It's a close call. So, my question is, what would you do?

[gbugmiami]

I think you already see the whole picture. Cut your losses. Unless there is another crazy upswing (unlikely), you are better getting out if you can. I just talked to a realtor buddy of mine who says it's the uggliest he's seen it in 20 years. Things arent selling. He told me i'd be better off renting mine than trying to list it (which HE'D make money off), but I can hold onto mine, and dont want to give it away. I'm only upsidedown a few hundred a month tho, not real money. He's having to kiss ass of his renters just to get his properties rented, and take rents (and renters) he'd never orginarily deal with. Managing that from cross country wouldnt be fun. Can you write off the loss if you do sell it?

[bale002]

Chances of another speculative bubble in real estate prices in the foreseeable future are virtually nil. Nevertheless, as you mentioned, riding general inflation, which will indeed be relatively high in the foreseeable future, you may be able to sell in three years at the price you bought, minus carrying costs.

Some say that long-distance/absentee landlords do not do well. Sure, if you wait five, ten, twenty years, you will make a gross capital gain, but, again, net of carrying costs, plus maintenance (you already mentioned repairs) and you may see that real estate is not always such a great investment.

Your best bet is to sell, take the capital loss, and start all over again in Portland, especially if you plan to stay long-term.

Good luck!

[joe33141]

Originally Posted by gbugmiami

I think you already see the whole picture... Can you write off the loss if you do sell it?

As I was writing the question I already knew the answer. And yes, you can write it off your taxes of the course of a couple years.

[Wild Style]

Originally Posted by joe33141

Any ideas on when the market might reset itself?

I live on the north end of Miami beach. I paid 270k for a remodeled 2/1 three blocks from North Shore Open Space Park. I have to move to Portland, Ore.

I think it's possible to sell the unit for 235k with all my furnishings.

But, I'm considering holding on to it despite the fact that the rent (if I rent it) will cover about half my mortgage. Needless to say, I'm well upside down in it.

If the market turns in three years I'll have spend about 43k to hold onto the place to maybe sell it at what I originally bought it for. But I'm also looking at the possibility of it going without renters for periods of time and having to make repairs.

It's a close call. So, my question is, what would you do?

the market "resetting" itself and housing prices going back to where they were a year ago are two totally different conversations. The market could normalize in 2010/2011 MAYBE. The market going back to the prices you saw a year ago is never going to happen, ever. Not unless annual wages go up significantly enough to sustain those sorts of prices.

[CJFlorida]

Originally Posted by joe33141

Any ideas on when the market might reset itself?

I live on the north end of Miami beach. I paid 270k for a remodeled 2/1 three blocks from North Shore Open Space Park. I have to move to Portland, Ore.

I think it's possible to sell the unit for 235k with all my furnishings.

But, I'm considering holding on to it despite the fact that the rent (if I rent it) will cover about half my mortgage. Needless to say, I'm well upside down in it.

If the market turns in three years I'll have spend about 43k to hold onto the place to maybe sell it at what I originally bought it for. But I'm also looking at the possibility of it going without renters for periods of time and having to make repairs.

It's a close call. So, my question is, what would you do?

What are you basing the $235,000 number on? Are other units selling briskly for that amount?

[eufo]

I doubt we'll see an upturn in the market anytime soon. To break even might even take more than the 3 years you're planning for. The problem is, nobody knows how bad the situation is going to get. With that kind of uncertainty, we're likely to see a very dramatic crash in property values.

In my 40 unit condo building, there are 5 for sale. They have been for sale for several months and I don't believe anyone is even looking at them despite them lowering their ask price a few times. There are others in the building who are looking to sell but are afraid to try and sell in the current market because they will not get what they need to cover their mortgage. There are also 2 units that are owned by banks due to foreclosure. They are not for sale at the moment, so I'm unsure what is going to happen with them.

If you can sell your condo for $235k, I'd say do it. It will avoid further potential losses. Don't forget there are things you will not be able to estimate such as special assessments that will tear a deeper hole in your wallet.

[Wild Style]

euro

some people know how bad its going to get. the media isnt talking about it though. all i will say is, this wasn't even round one, this was a friendly scrimmage. Mark my words, its far worse than most first envisioned.

[gbugmiami]

Originally Posted by Wild Style

some people know how bad its going to get. the media isnt talking about it though. all i will say is, this wasn't even round one, this was a friendly scrimmage. Mark my words, its far worse than most first envisioned.

I think things here are ugly. but i disagree with this. I still *have* seen houses sell recently for what i consider decent prices. (ie, my parents house, 20k off appraisal, worlds worst gringa grandma realtor, and it sold). Other friends too. There are still people that want to live here. There are still people moving here. If you have a skill/business that's needed here, you CAN do better than you could in alot of other places.

Correction will be = prices going to something people looking to buy can afford. I have friends here that make 150k a year, they will be buying and selling houses like nothing has ever happened. They of course arent buying my little biddy house. They would NOT be making that money in tennesee, north caroline, etc. Most of us here couldn't afford to live in what we have, were we to buy it today (me included). But we do what it takes to pay for the house/taxes/ins. My family in north fla pays 1/3 what I pay for insurance, and 1/2 to the same as I pay for taxes (for 2-3 times more house), and they thing THEY have it rough. Why? Its simple, they make less money up there. I had someone offer me a job doing almost exactly what I do here, for half the pay. People down here pay the premium to live down here, period. Its worth it to you, or its not. For me it was, and now its not.

Market Stability will happen sometime after correction. When things can reasonably sell within some sort of time frame (3-6 months?) without major price reductions. This will take A WHILE. Alot of idiots were enabled by various things recently to buy houses and pretty things they couldn't afford. This will have to clear up, all those forclosures sold, etc before there will be real correction or stability. But this is I think, more like half time. Cheap housing in Miami is gone for good. Wacko prices too, gone for now. There are of course deals out there, and forclosures would be what I was looking for. Were I to buy a house here now, it would not be one thats listed. If it was listed, Id offer you 50k less than apparaisal. And thats why my house isnt listed. (yet!)

[rogerbacon]

After the glut of houses on the parket are sold prices will start to climb again. Even at the high prices of a year ago Miami is still cheaper than places like New York. We will see crazy high prices again because people's memories are short and there is no shortage of people willing to pay top dollar for a piece of paradise (little do they know).