Real Estate Investments in Miami Condo Market Cook Unwary Speculators

They thought they had it made with their real estate investments in hot pre-construction Miami condos. They were told their property portfolios could never hold enough of these nuclear deals. They were right on schedule to make a killing.

So they kept buying into it. First one condo, than a second one. Now speculative condos three and four could possibly bring this young couple to their financial knees. That’s because they are losing several hundred thousand dollars.

How did it happen?

 

Elephant

They thought they had it made with their real estate investments in hot  [tag-tec]pre-construction[/tag-tec] Miami condos.  They were told their property portfolios could never hold enough of these nuclear deals.  They were right on schedule to make a killing.  

 

So they kept buying into it.  First one condo, than a second one.  Now speculative condos  three and four could possibly bring this young couple to their financial knees.  That’s because they are losing several hundred thousand dollars.   

Natalie and David Luongo are not the only ones  who were so  involved in flipping real estate in Southern Florida.  Many others are now losing their life savings also.

 

And as we remember way back in 2004, these were the people who would camp out all night just for the chance of putting 20 percent deposits on condos that hadn’t even been built yet.

 

Street  people were paid to hold the spectators’ places in line.   After all, times were good and these types of real estate investments were a sure thing for profits, right? 

 

The lesson here for all us who were watching from the sidelines comes from  crusty John  D. Rockefeller.

 

Once after receiving a stock tip from his shoeshine  man he immediately sold the stock.  The premise was if everybody knows about the tip on the street, it’s too late to make a profit.  He got out fast. 

 

What can we learn   about making prudent real estate investments?

 

We need to know exactly what the  property  can  be used for.

 

Is there a  demand?

 

Demand for properties comes from solid buyers and  great tenants who have good jobs and incomes.  They have to want to be there.  Speculators who are only buying air will always  get caught once the music stops.

 

We also need to  protect ourselves from the hype and glitz

 

Sure, some people did well with their property portfolios  in the [tag-self]pre-construction[/tag-self] markets, but they were professionals who knew those markets like the backs of the hands.  Anyone else was  simply playing with dynamite with these  real estate investments.  There is no substitute for doing your due diligence. 

 

Leave a Reply