South Florida Real Estate Investing: Not What It Used To Be

Investing in the South Florida housing market used to be a great way to make some great money, but the softening region is in state of flux right now. It’s a turbulent market, which is why CBS4 is kicking off a series of special reports this week, dedicated to the South Florida real estate market.

In part one, David Sutta takes a look at the “State of the Market” to try and determine whether the turbulent situation will get worse or finally get better.

For the past few years, Florida housing prices were rising and people were making money; now sellers are lucky to get an offer.

“We’ve had several open houses. Very few people have come by,” Dick Weiss said.

Weiss and his wife Gail have been trying to sell their Pinecrest home in Southwest Miami-Dade, which sits on an acre of land, for more than six months.

“A couple of years ago it would have sold in 7 days. We’re optimistic that it will sell,” said Weiss.

The Weiss’ aren’t the only ones playing such a waiting game.

Two years ago, there were 12,000 homes for sale in Miami-Dade and Broward Counties. Today that number is 78,000, an increase of 650 percent. Florida mortgage loan applicants are simply holding out until even better deals arise.

That massive inventory has led PMI Mortgage Insurance to rank South Florida near the top of housing markets at risk.

Fort Lauderdale ranks #11 and Miami is #12. The ranking means there is a 60 percent chance your home will be worth less in 2 years.

“The days of the quick flip are over,” said Hazel Goldman of Remax Advance Realty, a longtime realtor in Miami who agrees that the market has corrections to make, especially in condos.

“I feel that when the market was it’s hottest. People we’re buying up real estate like pancakes. And there was not as much discrimination as we would have liked to see,” said Goldman.

The end result: Those who bought anywhere just to get in stand to lose the most. Goldman believes those who looked closely at the address will be better off.

“In real estate, location now king again. For awhile it was less important.”

Weiss, hoping to sell his house, hopes every single day that someone will come in and buy it. Despite the fact that the Weiss’ home is in a great location, he’s dropping the price $100,000 below appraised value in hopes of getting the right Florida mortgage borrower in the door.

“We feel we have as good a shot at selling as anybody else. So we have to stay optimistic,” he said.