Miami's Real Estate "Recovery" Might Be All Wall Street Smoke and Mirrors
"There is the possibility that Wall Street and the banks and the affluent one percent stand to gain the most from this," Jack McCabe, a Florida-based real estate consultant, told the paper. "Meanwhile, lower-income Americans will lose their opportunity for the American dream of building wealth through owning a home."
"The investors are making it hard for a regular homeowner to buy a property," adds Robert Russotto, a Fort Lauderdale broker. "They are getting outbid by people with cash."
But investors and private equity firms remain undeterred. Some even sit glued to special computer software, waiting for deals and distressed homes to come on the market and swooping in to make cash offers.
A number of investors are not looking at these properties as things to flip once the price hits a certain level, but as sources of lucrative rental income for years to come.Though the real estate markets in Miami and surrounding areas continue to improve on paper, other economic indicators in the area aren't as good. The county's unemployment rate stood at 9.2 percent last month.
One firm tells the Post it bought most of its houses in the Ft. Lauderdale area for between $60,000 and $70,000. Meanwhile, it charges rents in the range of $1,700/month, several times what a homeowner would pay each month in mortgage.
[WaPo: Wall Street betting billions on single-family homes in distressed markets]
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