Miami Dade Real Estate Scoop

Throughout the course of business and selling Miami short sales I speak to lots of consumers about the real estate market. Whenever the topic of short sale fraud comes up, they are always surprised. Then I explain what short sale fraud is and that it's alive and well in Miami, much to the chagrin of those of us who fight constantly to change the reputation that precedes us. It's an uphill battle when scams affecting banks and unsuspecting consumers are still so prevalent.

So, what exactly is short sale fraud? It takes various forms. Here are a couple of the more prevalent ones in Miami:

• The selling agent may line up a buyer for the property at market value, but submit a different, lower, offer to the bank for approval. Oftentimes this requires that others be involved in this as well, as the lender will send someone to do a BPO (Broker's Price Opinion - similar to an appraisal but performed by an agent hired by the lender). Once the bank approves the lower offer and the transaction closes, the property is then flipped and sold at true market value. The seller is usually not involved in this type of scam, but can be and would then share the profits of the flip. The loser? The bank holding the original mortgage note who got a lot less for the home than it was really worth.
• This other form is the one that I am seeing much more often and I hesitate to say "seeing" because I have no actual proof that it is happening, just clues, many clues, that point to its existence. This 2nd one involves the seller always. It takes place when a seller has no intention of really selling the house. His intention is to get out from under the "huge" debt (his original purchase price) and stay in the house at the new, lower price. How does this happen? The "sale" takes place to a known buyer, even though they both sign affidavits that it is an "arm's length transaction" and neither one has anything going on with the other (can we say "perjury" boys and girls?). The seller does not act on his own. His real estate professional (and I use the term lightly) has to be knowingly doing this. You see, there will be requests made by other agents who want to show the property. The listing agent then ignores all those requests to make sure the only offer submitted to the bank is the one mentioned above. Why even list it then? Because it is a lender requirement. Shady!!

Today I was looking at closed sales in an area of Miami I know really well and one stood out like a sore thumb. A short sale that had been listed at $660K dropped the asking price to $330K in a matter of two months (red flag #1). Immediately after cutting the price in half, it pended (accepted an offer and changed the status on the MLS to "Pending Sale"). Three months later the transaction closed with a sales price of $250K. This by itself is not the next red flag. But I know this area. This particular home is worth between $440K - $495K in today's market. And it sold for $250K? Big red flag. I'm not really sure whether it's fraud of type A or B above, but fraud it is.

Besides the fact that the banks are losing out on huge amounts of money, there are the homeowners in the surrounding areas who are affected as well. The property values are affected by these bogus sales and it hurts other homesellers trying to sell their homes at bona fide market value. With a sale such as this one being used by an appraiser, it will be difficult for legitimate home sales to appraise.

This is infuriating. Besides that, it's illegal. Sigh.

When I moved to Miami from New York City ten years ago, one of the many things that were new to me were the canals throughout Miami-Dade County.  New York City has no flooding problems, unlike South Florida, where the canals were added many years ago to help with the flooding problems.

A very nice perk to having these canals all over Miami are the ducks they provide paddling space for. =)  I know that ducks can be a nuisance in many Miami neighborhoods which have lakes or back up to canals.  People who don't listen to conventional wisdom feed the ducks and create a problem.  Once accustomed to being fed, they will return for more.

Because I don't live in such a neighborhood, I don't suffer from the duck nuisance but can enjoy them from afar.  Today was a treat.  I was driving through a lovely neighborhood in the Southwest Miami area and kept seeing ducks all over the place.  The cutest sight was the mama duck with fourteen ducklings trailing behind her each waddling across as if performing for me.  I stopped the car and thoroughly enjoyed the sight.

Please be careful with the duckies as you drive around!

Are you looking for something fun to do this Halloween weekend?   Pinecrest Parks & Recreation has the answer!

Track or Treat will be held on Halloween day at Evelyn Greer Park.  Miami-Dade Monster Merchants will be set up around the track providing treats to all ghosts, goblins and friends.  Please bring a trick-or-treat bag!  There will be a bounce house and haunted house.

Track or Treat

Evelyn Greer Park

Sunday, October 31, 2010

5:00 – 7:00pm

8200 SW 124 Street

Pinecrest, FL

FREE!

Domain of Fears will take place both Saturday and Sunday.  Enjoy an event of scary fun-fear where the killer cupid and his minions await your arrival! Travel through a scary graveyard, the gypsy’s tavern, the castle of hungry vampires, a torture chamber, a portal and killer cupid’s love nest.  This event is appropriate for all ages!  I’m guessing that means that even chickens such as myself can go without fear of really being scared to death.

Domain of Fears

Evelyn Greer Park

Saturday 10/30 & Sunday 10/31

5:00 – 9:00pm

8200 SW 124 Street

Pinecrest, FL

$5 per person

Palmetto Bay Mayor Flinn was sued yesterday for not resigning his post as mayor before entering the race for County Commissioner.

The suit was filed yesterday by attorney Stephen Cody, a 30 year veteran of election law. According to Cody, one cannot be in office while running for a different office when one may end up serving both positions at the same time.

The lawsuit comes just days before the election.  Palmetto Bay residents are left wondering why this is happening now. There will be an emergency hearing this afternoon to determine if his candidacy will be disqualified.  Read more details here.

The Village of Pinecrest is looking into making better use of the Banyan Bowl amphitheater, located within Pinecrest Gardens.

Pinecrest commissioned a study which included the opinion of Pinecrest residents to discover whether the initiative would be welcomed by them.  Overwhelmingly, the majority of Pinecrest residents are on board for using the 500-seat amphitheater to bring cultural events such as music and theater to Pinecrest.

The study indicated that there are plenty of theater and music groups that could make use of the Banyan Bowl if it were upgraded.

Read more about it here.

Are you a Pinecrest resident wanting a tree on the swale outside your property?  Although the right-of-way property is not legally the homeowner's, the public swale is to be maintained by the homeowner.  And who doesn't want to keep their surroundings looking pretty?

Pinecrest has an Adopt-a-Tree program which provides trees at low-bid prices for interested homeowners.  Pinecrest has been designated as a Tree City, USA by the Arbor Day Foundation for their commitment to community forestry. The Village of Pinecrest has planted over 10,000 trees since 1997.  Not shabby at all.

If you'd like more information about the Pinecrest Adopt-a-Tree program, click on the link.

And remember that Miami-Dade County still has it's own program where they give two trees per year to homeowners of single family or townhome properties in the county.

Palmetto Bay and Cutler Bay residents who use Old Cutler Road please note that it will be shut down at the end of July for construction.  The South Florida Water Management District will be installing a flow-way tunnel beneath Old Cutler Road and this will impact the stretch between SW 156th Street and SW 162nd Street.

The road will be open to local traffic only.  If you don’t live in the area, make plans for a different route during construction.  SFWMD has stated that the project will take two weeks only and it is slated to begin no earlier than July 26th.  Utility services and the popular bike path on Old Cutler may be impacted as well so plan accordingly.  Click here for more information.

A citizen is fighting the Village of Pinecrest for improper seizure of her home.  Or should I clarify and say, her property, as she does not live in the Pinecrest house.

I just read an interesting legal article about the case involving Zenaida Gomez and the Village of Pinecrest.  Apparently Ms. Gomez purchased the Pinecrest home in 2006, in 2007 leased it to someone and in 2008 the Pinecrest police were called in to investigate some goings on in the home.

The police found that the Pinecrest home was being used for an illegal hydroponics lab (proving that the Redland doesn't have that market cornered and that upper scale neighborhoods are not immune to criminal activity, but I digress).  Due to the activities going on at the home, the Village of Pinecrest proceeded to seize the home, through legal means.

The article is full of legalese and I have to admit that I couldn't finish it.  It appears that the seizing authority (the Village of Pinecrest) has to prove that the owner of the house knew or had reasonable cause to know that the Pinecrest house was being used for criminal activity.  They claim she leased the home without even so much as checking whether the driver's license presented by the tenant was valid.

I checked the home's history in the Multiple Listing Service (MLS) and found the sale in there.  The home is in a great north Pinecrest location with multimillion dollar homes around.  The home itself was move-in ready but needing updating according to the MLS remarks when it sold.  It sold back in 2006 for $1,075,000 and according to a desktop appraisal I quickly did on it, might be worth in the neighborhood of $717K today, although that doesn't take into account the damage that is done to a home when it is used as a hydroponics facility.
In any event, I find the case interesting.  Be cautious when renting your home and make sure you do background checks!

Are you a buyer looking for a home in Pinecrest, Palmetto Bay, South Miami or the surrounding Miami area?

Would you like to have an upper hand while searching for homes on the internet?

Would you like to make your home search easier?

You can do this by downloading the Blog That Ate Miami Real Estate Toolbar.  It's a small, little download that gives you a way to contact me on any home you find for sale on the internet, regardless of where you find it!

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It's also a great portal to start your home Miami home search.    Just click on the Homes for Sale button and search to your heart's delight, specifying your criteria, for your specific needs.

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