I am considering an investment in Miami real estate

[n2da2nd]

Originally Posted by tallrick

I still cannot figure why anyone would want to waste their time on that dump called south beach.

Originally Posted by straight shooter

It's the movies, tv shows and magazines that influence people and make them think that South Beach is some sort of magical paradise. The reality is that it is really no different from other place other than weather. It has high real estate prices, high taxes, high insurance, low paying jobs, riff-raff coming from the mainland to cause nothing but trouble, rampant drug use and people with questionable backgrounds.

Different strokes for different folks, I guess. Btw, I just contacted my realtor yesterday and found out that the real estate is going up.

[paenca]

Originally Posted by tallrick

Anyone who knows me over time knows that I can spot a trend before most. In 2008 when the financial panic hit I had a few friends already sitting on cash to pounce on properties. When I saw the extreme measures Bernanke was taking to hide the crash I predicted another bubble in Miami on the way. The USA is like an old tire, with bubbles in the sidewall. Instead of replacing it, the Fed decided to pump more air in to keep it inflated. The result- the bubble areas are back inflating again. However, like an old tire it weakens with age. This time quantitative easing will blow the whole system into oblivion. No amount of drug money can fix it this time. Before investing in south Florida, consider these points:

1) Who is buying properties

2) Who is renting

3) Where does their income come from

You know in your heart this area is unstable and a huge bubble. Do not be among the next flock of sheep to be sheared.

Very impressed with this post. Are you familiar with the the RE markets outside of Miami/Florida? Where in the U.S. in your opinion would be more sustainable in terms of real estate investments?

[straight shooter]

Originally Posted by n2da2nd

Different strokes for different folks, I guess. Btw, I just contacted my realtor yesterday and found out that the real estate is going up.

Don't be naive, what is the "Realtor" going to tell you. When things are high they tell you that things are going to continue to go up. When things are down they tell you that now is the time to buy because things are going to go up tomorrow. While it is true that real estate has recently gone up especially in the good and desirable areas I doubt that they will continue to go up. Things are going to plateau or even go down slightly. Real estate prices are a reflection of the economy and don't forget that we still have not fully recovered, the unemployment rate is still high and most jobs available are low paying service jobs. The recent real estate boom has not been fueled by locals, it has been fueled by foreign speculators which tells you that the local economy and the residents of Miami are still impacted by the bad economy. If the economy doesn't improve soon real estate prices will start to go down because lets face it we do not have an unlimited supply of wealthy foreign investors and individuals, and the ones that have already purchased will want to sell sooner rather than later.

[midnightfapper]

Originally Posted by straight shooter

It's the movies, tv shows and magazines that influence people and make them think that South Beach is some sort of magical paradise. The reality is that it is really no different from other place other than weather. It has high real estate prices, high taxes, high insurance, low paying jobs, riff-raff coming from the mainland to cause nothing but trouble, rampant drug use and people with questionable backgrounds.

[straight shooter]

riff-raff coming from the mainland to cause nothing but trouble Yes, absolutely, think of Memorial day weekend

people with questionable backgrounds. Yes, think of all of the people with shady backgrounds and unexplained wealth that come from other countries and purchase real estate and live on Miami Beach part time.

[tankhead]

Originally Posted by andyo4you

I belive in the 15% rule. Buy a home (cash) that you can get the same amount of money you invested in less than 7 years. $80k home rent it for $1100-1300 at 1300x12=$15600x7 years = $109,200 cost you $80k and you probably paid less than $1500.0 a year for taxes and insurance about $1500-3000. Lets just say that all the rest apart from the $80k is taxes, insurance and fixtures, you can triple the money in less than 15 years. There is no market with less $ that cant beat %15 returns other than starting a small business. If you know of one that is legal let me know! CD's are only giving us 1.5% and we lose more than that do to inflation! rip off.

The stock market can beat that if you buy large company stocks with dividends and reinvent them.