Wake-Up Call for Condo Investors Flippers
While New York real estate continues to chug along, albeit it at a more measured pace than a year ago, other major cities that have been on building sprees have felt a sharp reversal in the market. In places like Miami, Chicago and San Diego, where the percentage on non-occupant owners is much higher than…
While New York real estate continues to chug along, albeit it at a more measured pace than a year ago, other major cities that have been on building sprees have felt a sharp reversal in the market. In places like Miami, Chicago and San Diego, where the percentage on non-occupant owners is much higher than New York, the condo-flipping ponzi scheme is starting to crumble like a house of cards. At the Jade Residences at Brickell Bay in Miami, for example, more than 20 percent of the 352 units are on the market. In San Diego, about a third of the 96 units in the Alicante, a condo that opened last fall, are on the market and sellers are already starting to cut asking prices. Of course, New York is not totally immune to this trend: At 120 Riverside, which the Donald already cashed out of, more than 20% of the units are on the market. With so much inventory, says Ilan Bracha, a broker with Prudential Douglas Elliman, “the buyers are coming in, checking the best views and then they negotiate. This is the reality.”
Farewell, Condo Cash-Outs [NY Times]
Anon at 10:50 – amen. We listed our condo with Corcoran, got 20+ people at 1st open house, two bids the next day – both symbolically lower than ask and are in contract less than a month later.
The moral of the story is that well-priced property will still move quickly.
also buried in that article was the fact that prices continue to rise, just not at 30%.
The short answer to 9:39 post are, yes,10%, yes, and no. In New York you have to close before you can flip.
Anyone know how this works with the pre-construction condos? So you enter a contract to buy….how much money are you putting down …is it held in escrow….is it easy to back out if things aren’t going as you planned?
I think it’s important for people to keep in mind that the condo flippers are simply partners of the developer.
In these developments the developer shifted some of their risk to individuals who are able to wait a little longer to get paid.
If no flippers/investors were involved and the developer had sold 80% of the units people would say it was a very successful development. That’s essentially what’s happened here only the risk/reward of selling that last 20% of the units has been taken on by people other than the developer.