In case you think that the investment in Miami is starting to ebb, there is an article in today’s Business Monday about Fort Capital Management, a private equity firm, buying up prime South Florida real estate. Their most recent purchase it the Surf Club in Surfside.
Miami-Dade’s strong rebound in the tourism industry is driving up sales of hotels and fueling construction.
I attended a very informative windstorm insurance session at the Miami Realtors Association this afternoon. The presentation by Lee Gorodetsky, The Home Insurance Guru and President of L & S Insurance, was my third insurance update of the year because that is how much of a moving target Florida insurance has become.
So why is property insurance a more important issue than taxes in South Florida? It is not because hurricane Sandy is churning off the coast of our neighbors in the Bahamas. It is because we only have a sales tax and property tax, no state income tax and Citizens, what has been the major insurer in Florida, is so grossly overexposed that it is changing all of the rules to minimize it’s exposure if The Big One hits.
In Miami, property insurance prices for a primary or secondary home range from 1-3% of the replacement cost of the home, calculated by multiplying the living area square footage by $135 for an average standard home. Luxury homes would use a higher dollar amount. The 1% is for homes built after 2006 that receive all of the current wind mitigation credits. Most homes are closer to the 3% range. Property insurance runs at about 2% of the purchase price and as long as you have homestead exemptions, it cannot go up more than 3% or CPI per year, whichever is lower.
The rates on Citizens insurance are expected to increase dramatically next year to raise money to try to close the gap they have between their reserves and their risk exposure. They will also be dropping an estimated 300,000 policies, mostly in south Florida.
There are three amendments relating to property taxes on this November’s ballot and not one amendment addressing insurance.
Related Post: Hurricane Insurance: Will It Be The Next Shoe To Drop In The Recovering Real Estate Market
The Mournings sold their home in Coral Gables and downsized to the Village of Pinecrest. The Mournings join several distinguished residents who call Pinecrest home.
The Sanctuary at Pinecrest is on 112 Street, next to the Village of Pinecrest Community Center and Pinecrest Gardens. Twelve homes are tucked into this enclave built by nationally recognized, award wining builder Brookman-Fels. Built between 1995 and 1998, the homes sit on over 33,000 square foot lots and are between 5,200 -7,900 square feet under air. The last sale in the Sanctuary at Pinecrest was in August of 2009. It closed for $1,577,900, $285.44 per square foot.
Just south of Red Oaks and next door to Wayside Fruit Stand is Arboretum. This gated community of 11 single family residences was built between 1991 and 1993. Homes range in size from 4,000 to 6,000, lots from 15,000 to 19,000 square feet.
The residents really love Arboretum; there has not been a property listed for sale in there since 2010! It sold for $1,600,000 ($320 per square foot). Homeowners fees are $1,000 per quarter.
Stay tuned for my next featured community in this “Gated Communities in Pinecrest” series.
Miami is a very international city with lots of foreign investors. If you are buying property here, you need to make sure to ask if the seller is a foreign investor or you could be on the hook for money owed to the IRS.
Under FIRPTA, Foreign Investment in Real Property Tax Act, there is a mandatory 10% withoholding of contract sales price at closing for all foreign sellers of real estate. It is the BUYER’S responsibility to make sure the 10% is withheld EVEN IF THEY ARE WORKING WITH AN ATTORNEY &/OR TITLE COMPANY. The withholdings must be remitted to the IRS within 20 days of sale along with a special tax return.
There are exceptions to the withholding that your Realtor, title company or attorney can walk you through, but you first must ask the question.
The Jade is a beautiful, modern, waterfront building that is walking distance to all of the activity on Brickell Avenue. Built in 2004, the Jade has amazing resort-like amenities including a spectacular infinity pool, state-of-the-art gym, entertainment rooms, private elevators to your residence, and views galore.
The Jade was one of the first luxury buildings completed during the boom and provides a great historical perspective of the boom, bust and now rebound of Miami real estate. There are currently 23 units listed for sale out of a total of 326 units. The average price listing price per square foot is $629. In 2004 the average price per square foot of units sold was $540 and at the height of the market ini 2007 it was $805.
Approximately one-third of the building is still owned by original buyers who purchased in 2004 and 2005. That fact, coupled with the fact that the majority of the sales that took place in 2008 and 2009 were cash purchases, results in a very stable condominium association.
The 49th annual Coconut Grove Arts Festival is just one of the many art festivals and events that take place in Miami. We have art walks in a variety of neighborhoods (Coral Gables, Coconut Grove, Little Havana, Wynwood)throughout the year, the Beaux Art Festival, Art Basel, and many other satellite fairs. If you are an art lover in town for the festival and are considering a real estate purchase, here are some areas to consider
Coconut Grove
Coral Gables
Miami Beach
Brickell
Wynwood/Midtown Miami
Aventura/Sunny Isles
The 49th annual Coconut Grove Arts Festival is just one of the many art festivals and events that take place in Miami. We have art walks in a variety of neighborhoods (Coral Gables, Coconut Grove, Little Havana, Wynwood)throughout the year, the Beaux Art Festival, Art Basel, and many other satellite fairs. If you are an art lover in town for the festival and are considering a real estate purchase, here are some areas to consider
Coconut Grove
Coral Gables
Miami Beach
Brickell
Wynwood/Midtown Miami
Aventura/Sunny Isles
If you are visiting Miami for the International Boat Show, welcome. Whether you are here for the first time or have been here often, if you are here for boats check out the marina resources on the right hand side of this blog. Interested in properties that are close to marinas? How about homes with their own dock? Boating around Miami, to the Bahamas or beyond is just one more reason I Love So Fla!