2025 BRICKELL AV Unit: 306, MIAMI, FL 33129
- 4 Bed, 4 Bath, Condo
- Bought in August 2005 for $1,000,000
- On the MLS for $679,900
- Loss before the Realtor® commission: $320,100
- Loss after the Realtor® commission: $360,894
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9 comments:
For a million dollars, you'd think the building wouldn't have a hole right in the middle of the it.
Lawmaker: Subprime defaults set to rise
Posted 22m ago | Comments 2 | Recommend E-mail | Save | Print | Subscribe to stories like this
BRUSSELS (AP)— The U.S. home loans crisis is going to get worse before it gets better, a U.S. lawmaker said Monday, claiming that the number of defaults will keep climbing in coming months as recent mortgages automatically shift to higher repayments.
Republican Senator Richard Shelby of Alabama, a member of the Senate's banking committee, also said credit rating agencies would likely be held to account at Senate hearings for rating questionable debts as good investments.
Banks across the world have already become far more cautious about lending after a sharp climb in the number of people not paying back housing loans that were made to borrowers with no security or a bad credit history. Easy credit has vanished for the time being.
In an effort to loosen the credit crunch, the U.S. Federal Reserve last week cut its discount rate, the interest rate that it charges to make direct loans to banks, to 5.75% from 6.25%. Central banks in Europe, Japan and Australia also tried to help by injecting billions into the banking system over the past two weeks.
The European Commission said Monday that financial markets appeared to be more calm after stock exchanges plunged last week. But EU spokeswoman Amelia Torres said it was far too soon to say what effect the crisis would have on the EU's wavering economic recovery.
http://www.usatoday.com/money/industries/bank...
2207 Driftwood Circle, Palm Beach Gardens 33410, bought in 05 for
1,205k, listed for 999k, MLS # R2765842
Lis pendens filed Feb/.07. on mkt since January 07.
Remember high condo fees and taxes, too.
To find the true loss to these f@cked flippers, here is what you need to figure:
- Mortage interest paid over the entire period held.
- If it was bought in cash, or if there was any down payment, calculate the lost interest on that cash at about 5% per year (they could have put that cash into a CD earning at least that much during that time period)
- HOA fees
- Property taxes
- Homeowners insurance
- Real estate commission
- Closing costs on the buying end (mortgage closing costs, etc)
- Closing costs on the selling end (most sellers pay title insurance and doc stamps)
- Any improvements made to the property
- Any money spent maintaining the property
- And of course, add in any loss in value between the buying and selling prices
Add up all those expenses and then subtract the rent (if any) that was collected while they held it.
There is your loss.
I'm not saying we need to actually estimate all this stuff for these posts.
I'm just pointing out that the losses mentioned on the "F@cked Buyer" posts are vastly underestimated.
Don't agree. You can't put costs of carry as a loss if the apartment was used to live in.
"Don't agree. You can't put costs of carry as a loss if the apartment was used to live in."
You're correct, but keep in mind that this particular apartment was not homesteaded in 2005 or 2006.
While this doesn't necessarily mean that the owner didn't live in the apartment, it is highly likely.
I imagine this was bought with the intention to flip -- a flip that never happened, just like thousands of other highrise condos in the Miami.
In the end, it's nearly impossible to compute the true loss to the buyer because so many factor come into play.
Many of these properties included in "Today's F-cked Buyer" are short-sales or foreclosures. In some of these cases, the buyers used 100% fianancing to purchase the homes. Then, they lived in them as much as a year without paying on the mortgage before the foreclosure was finalized. In these types of cases, one could argue that the "buyer" was far from f-cked. They actually lost nothing and got a rent-free abode for many months. In these type of cases, the "buyer" actually came out ahead financially, albeit with ruined credit.
In the end, it's nearly impossible to figure out the true loss in any of these cases without having access to all the related loan and financial information.
"Don't agree. You can't put costs of carry as a loss if the apartment was used to live in"
The true purpose of buying a house or condo is to have a place to live.
Keep in mind that most of these condos come finshed inside already. A rental unit will be identical to one that you buy. So I don't see any difference to living in a unit you bought versus one you rented.
If I buy a condo in a building for $500k which costs $4000/month to own, but I could have rented an identical unit for $1,800/month, I would consider the difference between the rent and the owning costs as a loss.
Or, at least, even if I theoretically could have sold the condo for the same price I bought it for 2 years later with no closing costs, I would still be $57,000 poorer than if I had rented (i.e., if I had put that extra $2200/month I'm saving by renting into a 5% bank account).
Some people don't like to look at that as a loss. A rational person would, however.
And I'm not talking about what is considered a loss in accounting or tax terms--I'm simply talking about what the bottom line impact of your investment decision was to your net worth.
Well given how many Miami/Miami Beach "residents" are non-US citizens (such as myself) or spend say 3-6 months of the year (non-homestead), I agree it's impossible to tell (let's not start with equity of this bizarre piece of Florida statute!)
The problem is ex post or ex ante analysis.
But before everyone gets too glum, I just want to point out that buying half decent real estate (SFH not condos) for $100-$200 a sq ft is almost impossible elsewhere in the developed world.
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