Interesting article in today’s WSJ about vultures buying condos in Miami; interesting on two points.
First, the article implied that a buyer shouldn’t expect the same good deal from new condo towers built side by side, because the builders cost are different depending on if they were started before or after the last big hurricane season. As a buyer, I don’t care what the seller paid for anything. The market dictates the price. That’s why people are so angry at builders who are discounting houses 30% below the selling price two years ago. Selling price of real estate is dictated by the selling price of recently sold real estate, not the cost of the property in question.
Second, the WSJ showed a picture of high-rise condo buildings along Miami’s beach front. The density of the units on the beach is startlingly high. Unless, I’m coming from a high density residential area, I don’t see why I would want to buy a vacation or retirement unit in such a crowded area. Even if I come from a high density residential area, I don’t see it the desirability of a crowded area. Like my father used to say, “Why do I want to hang around with a bunch of old people?”
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