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5 Things You Need to Know Buying a Condo in Miami

 Guest Realtor, Bernie, on Dec 17th #MortgageMonday hosted by Yousif Mohamed, Loan Officer at Movement Mortgage

In the condo buying process in Miami, a real estate professional is the starting point yet it is also important in the initial stage to consult a mortgage lender. Source of funds should be in place before viewing properties. If not buying cash, then financing is needed; knowing below adjusts expectations and smooths the process.

#1 Proof of Funds Necessary

A statement of either bank account balance that reflects funds to satisfy list price or pre-qualification from a lender is standard to schedule showings. Clarity of liquidity or approved loan amount affords a focused search by list price and even condo building. 

#2 Decide Cash vs Bank vs Direct Lender 

Cash is the most favorable negotiation for lower selling price. Main street institutions such as Bank of America, Chase, Wells Fargo et al. may not be able to finance loan due to a limited number of and more restricted, standard, nationwide products of which many condo buildings do not meet requirements. Direct lenders are able to be more flexible with credit and income profiles, customize based on circumstances, and underwrite loans for condo buildings that do not meet requirements for increased fees. It’s best to work with a local contact even if the bank or direct lender is national as they have knowledge of specifics for the city of Miami and condo buildings. 

#3 Down Payment Possibly Above 20%

Although there is an oversupply of condo inventory, owners generally demand conventional 20% offered. However, if condo building does not meet requirements or if a limited review process is elected, down payment will be higher. The market has been trending 25% - 35% for down payment. New development condos do not accept loan financing for initial deposit or first 50% of payment schedule.

#4 Association Approval Required

The condo building will go through full or limited review. It may not be approved most times due to not meeting specific requirements for ownership rules and HOA conditions.

#5 Federal Programs Limited Acceptance

VA financing is accepted by few condo owners and registered approved for few buildings. While FHA is a financing term more readily accepted, it is still limited. New development condo developers do not accept federal programs.


Please contact me to discuss more.

#investinmiami #movetomiami

4 Things You Should Know Buying in Miami

While not all-encompassing, this is a quick digest of initial considerations for purchasing in current market Miami. It is comprised from most common misperceptions by out of state and international buyers. 

#4 Reality Price Check

The popular budget target of $250,000 does not buy the modern interiors, amenities and zip code many have in mind. Typically at this price point or less, the property or unit is smaller in square feet, older, likely requires renovation as well as has fewer or no amenities and is in an upcoming neighborhood or not as desirable an area. Q4 2018, Miami Market Report

#3 Don’t Fear Fees

In many cases, HOA (homeowners association) fees are nearly same as separate maintenance costs when totaled. Condo associations can be ideal for absentee owners as there is typically onsite property management to handle repairs, grounds upkeep and more. Many single family home communities have association regulations and fees too. 

#2 Adjust ROI Expectations

For Miami investment property in a single unit for rental, the average cap rate is 4 - 5%. Factor property taxes, HOA/maintenance fees, insurance, utilities and rental fees (vacancy, broker’s fees, furnishing). Temper turnover and return expectations from Airbnb; on Miami Beach as of 2016, there is a fine of $20,000 for first-time violator of short-term rentals (less than six months and one day) in condo buildings and banned altogether for single-family homes. For transient rentals, owner’s must adhere to regulations: ensure it is legal for property location, submit appropriate business and resort tax receipts, and show proof condo association allows. Additionally for those seeking a coastal/waterfront purchase, flood insurance premiums will increase

#1 Select One Realtor

Unlike other cities where multiple real estate agents may be used for their different property accesses, only one agent is needed as a partner for all aspects of the process in Miami as the MLS (multiple listing service) access is reliably used by all licensees in this market. Find a licensed, reputable realtor or broker you have rapport with to represent your preferences, negotiate on your behalf, and follow through on your requests. They provide value in recommending areas, giving referrals, and understanding your financial objectives to assign the buy and timing appropriately for wealth building, investment income, or trophy purchase. Aside from being knowledgeable, also select someone well-networked with contacts for inside information on properties, priority for new development better pricing, access to exclusive previews, and a pulse of local market and external factors, for example high vs. low season and economic conditions.


Please contact me for more details, data and deeper insights.



Miami 101: Three B's Geo Basics


Miami neighborhoods with three dot icon represent @lipstickandpropertyalue specialty areas, Three B’s: The Beaches (South, Mid and North), Brickell and Biscayne Corridor (Downtown, Edgewater and Midtown). 

To briefly differentiate:


Miami has some of the most coveted and accessible beaches, year-round outdoor activities, and renowned night life and experiential events to #livewhereyouvacationArt Basel Miami Beach in December is world-class as are other marquee events such as the South Beach Wine and Food Festival and performances at the New World Symphony. As the Beaches are an island, there’s not a lot left to develop and property is at a premium for either oceanfront or bayside. More affordable units are older, on lower floors, city facing, or lowrise buildings with no amenities or assigned parking, decal only. New development units are top dollar. 1 Hotel & Homes is an oceanfront 'haute' spot.


The #brickellliving experience is space use of unit, throughout building, walkable to entertainment, plus no car conveniences. The neighborhood's condos offer more newness, living area, and amenities vs. the Beaches. Brickell Financial District real estate is popular for investment cash flow from the high rate of residential rentals not only long-term, annual lease locals, but also short-term vacation goers given close proximity to airport. Brickell’s biggest year yet was 2016 topped off by the opening of Brickell City Centre with prime residential condos Reach and Rise towers, Class A offices, and premium retail including Saks Fifth Avenue; it is now the heart of Brickell, Downtown Miami affording unparalleled live-work-play. 


New hallmarks of entertainment extend beyond the Beaches to #downtownmiami with the Adrienne Arsht Center in the Arts & Entertainment District, Pérez Art Museum Miami in Museum Park along Biscayne Bay, Brightline express train to Orlando, many galleries in Wynwood Arts District, the curated shopping mecca and cultural scene of the Design District, and the Miami Open for tennis in Key Biscayne. Biscayne Corridor offers a slight suburban feel as its less dense compared to just south Brickell and less recreational and tourist inhabited than the Beaches. PARAMOUNT Miami Worldcenter when completed in 2018 will revolutionize the area.


For 2017 and beyond, there will be growth in the urban core with both buyers and renters recognizing the value on mainland in Brickell and Biscayne versus the Beaches. There is also a shift with growth in end users as relocators from cold climate cities is increasing as well as absentee/investor owners weekending in higher frequency.