Say you want to sell your unit at Related Group’s new 50 Biscayne Condo in downtown Miami, you find a buyer willing to purchase your unit, you agree on terms, and you probably think, “whew, I’m really lucky I sold.” Not so fast: today’s Daily Business Review is reporting
Banks and mortgage lenders compile lists of buildings they find too risky for lending, and they refuse to finance purchases there.
What This Means if Your Miami Condo is “On the List”
It could mean that it will very hard to obtain financing for your condo, whether you are a buyer or a seller, in one of the “non-warrantable” condominiums.
The lists include finished buildings and projects still under development.
Prominent projects on BankUnited’s list include the Related Group’s 50 Biscayne and 500 Brickell; Terra Group’s 600 Biscayne and 900 Biscayne, and Cabi Developers’ Everglades on the Bay.
Is This the Last Nail in the Coffin for Miami Condos?
The impact of today’s news on the Miami condo market:
- Developers with unfinished buildings on the list may have high “walk-away” rates
- Owners of units in “blacklisted” condos may find it next to impossible to sell
Check out Miami’s “blacklisted” condos here:
UPDATE: South Florida Business Journal is reporting that Bank United has blacklisted Opera Tower as well.
Even buyers with good credit can’t get a mortgage for a condo that has an uncertain value, said Lewis Goodkin, president of Miami-based Goodkin Research. He said because sales have been so slow and 35 percent to 40 percent of buyers could pull out of contracts in some buildings, no one knows the real value of these condos. And, if lenders don’t know the value, he said, they can’t set a loan-to-value ratio with any certainty.