By Steve Bergman - Inman News: For existing owners, liquidation can be bittersweet
Some 1,500 condominium units in Greater Downtown Miami were sold from April to June this year, reported an associate of mine, Peter Zalewski, a principal with Condo Vultures LLC in Bal Harbour, Fla.
All those units represented 1.8 million square feet and reduced the number of new condos under developers' control to a mere 5,100 units.
About the only disquieting news in all of Condo Vultures' data was that gross sales amounted to $584 million, or just $333 per square foot. The reason for the low pricing was that most of those units were sold at bulk sales. Or as Jay Steinman, a Miami attorney who has been in the middle of many condo sales, said, "That would be one guy buying 200 units, another buying 50 units, that kind of thing."
The question is: Are bulk condo sales a good thing? The answer is, generally, yes, but it depends on where you live, what you own and how willing your bank is to let you be market-competitive.
Miami isn't the only city with major bulk condo sales. In 2005, the last year before the real estate downturn, there were only eight bulk condo sales in the country with a value of $162 million, reported Real Capital Analytics. By 2009, the numbers jumped to 84 with a value of $856 million. Through June of this year, bulk condo sales reached 47 with a total value of $918 million.
"We have already hit the full year's total of 2009 for bulk sales, but I was surprised there (weren't) even more," said Dan Fasulo, a managing director with Real Capital Analytics.
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