The Post-Collapse Real Estate Market (Miami, Surfside: for sale, oceanfront, HOA)

[WilliamInMiami]

I know it's only been a few days since the Surfside collapse but I'm wondering how this will affect the red hot Miami real estate market. Are there any signs of buyers backing away out of fear? Sellers lowering their price, especially along the beach? Prospects requesting low rises?

Also, I live in a 4 story gated condo building just barely outside of Brickell. Will the appreciation accelerate due to a possible increased demand in low rises? Would buying another unit be a smart investment right now?

[logybogy]

I think demand will decrease and supply will increase on the market especially for older 80's condos that haven't done their 40 year recertification. It could be a nasty correction.

It's just going to get a lot more expensive to maintain oceanfront buildings. Long term it will be a good change as it will make things safer but in the short to medium term there will be a lot more inspections, a lot more expensive assessments, and HOA and insurance fees are going way up. A lot of owners won't be able to afford or change their perspective on living in these money pits and they'll put their condos on the market and create a glut and the market will correct.

The $25,000 condo assessment every few years is going to get annoying as hell but that is probably going to be the new normal.

[FL_Expert]

I’m curious to see how this turns out. It might be a good opportunity to buy something at a discount.

[Huasho]

Originally Posted by FL_Expert

I’m curious to see how this turns out. It might be a good opportunity to buy something at a discount.

Go to Harbor Freight Tools for that . . .

[DrSpag]

It will most certainly be a catalyst for what's to come in the real estate market in these types of buildings. There's hundreds of them out there. Water, salt, wind, corrosion, weathering, sinking earth. The reason this thing fell is absolutely a combination of those factors which makes it all the more unsettling because it's hard to identify and more importantly, truly difficult to fix. It's also the likely reason a lot of these structural failures are inspected, and then overlooked...


My good friend that lives on the beach in a condo as far north as palm beach county is telling me that there are many of the residents in his building including himself that are afraid to sleep and go into their own homes! My friend is staying with his mother even though there's no evidence of a problem in his building! He's already planning to move out, and sadly he may end up taking a loss on his condo - we don't know yet. There may be a market for people looking for deals out there, but ultimately this does not spell good things for the market.

Perhaps out of panic, he's already starting to talk about his condo becoming an expensive ”paper weight” and people are confused at this point whether or not they should put their units up for sale now, or see what happens...

It's illogical to say that people have something to fear on a broad level because this is truly a rare and unheard of occurrence. My buddy is a level headed guy and he's already having these thoughts about his condo, so that says a lot about what is going on in the minds of folks that live in these places.

[Corrie22]

It happens every hurricane....and then people forget

[Igor Blevin]

After 2 weeks it will be completely forgotten. People have conveniently short memories. In this case, they should. That was an extreme outlier, not some predictor of future problems. I am not saying there could not be a repeat, but we are talking million-to-one odds of a problem. Who is going to change their plans for that. It stops you cold for a week, and then you forget it and move on.

[elchevere]

Agreed….an isolated incident…now if 2-3 other buildings collapse or a Category 4 or 5 direct hit….I remember how people thought NYC real estate was dead after 9-11 and Sandy. Like you said, people have short memories.

Originally Posted by Igor Blevin

After 2 weeks it will be completely forgotten. People have conveniently short memories. In this case, they should. That was an extreme outlier, not some predictor of future problems. I am not saying there could not be a repeat, but we are talking million-to-one odds of a problem. Who is going to change their plans for that. It stops you cold for a week, and then you forget it and move on.

[k350]

It will be the special assessments that are going to drive a lot of people away.

[logybogy]

Exactly. It's going to be a bifurcated market. Prices will continue to go up and perhaps way, way, way up in new buildings built post-Andrew and very well maintained.

It's the pre-Andrew crap built in the 70's and 80's that may turn into assesment money pits.

Originally Posted by k350

It will be the special assessments that are going to drive a lot of people away.