The Story of the Lonely Miami Condo Building

New York, NY (PressExposure) June 27, 2011 -- Back in 2005, a beautiful condo building was planned on Collins Avenue in North Miami. Very luxurious, each condo unit encompassed a full floor. All kinds of amenities were planned for this oceanfront building, including private elevators to each condo unit.

Construction started in early 2006 and, by 2007, construction was halted. When in Miami, I pass by this condo building on my morning walks/runs. For the past three years, all I saw was an unfinished building, construction crane projecting halfway through the unfinished structure. My wife used to call the unfinished structure the "Lonely Condo Building."

This morning, I was pleased to see that construction at the building has recommenced. The bank that foreclosed on the original developer has sold the building to another condo builder, who is now forging ahead with completion.

A total of 48,000 condo units were built in a stretch east of highway I-95 from Miami to Palm Beach during the real estate boom years, which came to an abrupt halt in 2007. It was common to drive your car up Collins Avenue and see buildings popping up. A sign saying "Financing by Lehman" often appeared in front of many of these buildings. A couple of the seven Trump buildings built here are true architectural masterpieces.

If there was a real estate market that got hit hard after the bust of 2007, it was Miami. But things are slowly turning around.

Sales of existing home and condos in the Greater Miami area rose 71% in the first quarter of 2011 from the first quarter of 2010, according to the Miami Association of Realtors. Almost half of all transactions in the first quarter of 2011 were sales of bank-owned properties.

Who's buying these condos? Fifty percent of all the sales of condo units over $500,000 are to Brazilians. The balance is to Canadians and Europeans. Americans account for only a small portion of the buyers, who are either paying full cash or are financing only half of their purchases.

Short-term, things look good in Miami. Long-term, I'm worried. Interest rates will eventually move up. Banks have slowed their pace of foreclosures. There are many more properties to come on the market, the question is when?

If you are looking to buy a condo in the Miami area for vacation use, price becomes a secondary consideration. If you are buying for investment, don't expect a good return on investment for years to come.

Michael's Personal Notes:

Two current trends I want my readers to be aware of:

After reaching a new record high of $1,552.50 an ounce on May 22, 2011, gold bullion prices have pulled back $50.00. A $50.00 pullback is nothing to be concerned about. If you look at the rising price trend of gold bullion since the $1,000-an-ounce level, the trend is a slow move up, a sharp pull back. This trend will continue and sharpen as the price of bullion continues to rise.

I see any weakness in the price of gold bullion as an opportunity to purchase the shares of the junior and senior gold-producing stocks.

In a mirror image of last summer, investors are running to U.S. Treasuries again. A short history: 10-year U.S. Treasuries fell to a yield of 2.4% in October of 2010. They then rose to a yield of 3.77% on February 9, 2011. Now, the yield is back down to 2.88%.

By the fall, we will be looking at higher yields on U.S. Treasuries; hence, I'm avoiding them. According to Bloomberg's survey of 64 bond forecasters, the yield of the 10-year Treasury is expected to hit four percent by June of next year. I believe it will happen sooner.

Where the Market Stands; Where it's Headed:

A bear market rally in stocks, although old and tired, continues to prevail. I expect another run-up in stock prices before Phase III of the bear market sets in.

What He Said:

"You've been reading my articles over the past few months and have seen how negative I've become on the U.S. economy. Particularly, I believe it's the ramifications of the faltering housing sector that are being underestimated by economists. A recession doesn't take much to happen. It's disappointing that more hasn't been written on the popular financial sites and in the newspapers about the real threat of a recession happening in 2007. I want my readers to be fully aware of my economic opinion: I wouldn't be surprised to see the U.S. economy in a recession sometime in 2007. In fact, I expect it." Michael Lombardi in PROFIT CONFIDENTIAL, November 13, 2006. Michael was one of the first to predict a U.S. recession, long before Wall Street analysts and economists even thought it a possibility.

Retire on This One Hot Stock!

This stock is up 232% since we first picked it. Our expert analysts say it will go up another 100% in the next 12 months! Our top 19 stock picks were up an average of 173.57% in 2010 (not a misprint). See where we are making money in 2011 and get our combined 100 years of investing experience working for you starting today.

Get your FREE report on our top stock pick immediately here.

About profitconfidential.com

[http://www.profitconfidential.com/pcabs/]


Visit our site:


http://www.profitconfidential.com/


Press Release Source: http://PressExposure.com/PR/profitconfidential.com.html

Press Release Submitted On: June 27, 2011 at 11:05 am
This article has been viewed 28616 time(s).