Tag: beach front condos

Old Deals – BACK ON THE MARKET

We’ve decided to do something different this week. Going through our old episodes, seeing what’s available or back on the market, we’ve found three very special deals that are back on the market. These are deals that were so hot they sold quick, but for one reason or another the deal fell through and they are back on the market. So, without further ado:

Deal 1 – Waterfront Wild Heron Condo for only $249,000

Let me start out by saying that this is waterfront, not gulf-front, there was some confusion on this last time. But, with that said, this condo is in the popular and truly one-of-a-kind gated Wild Heron community and is in immaculate condition. This condo at one point sold for $800,000. Now, I know that what something sold for at one point means nothing, but just think about this for a second. In order to command a price tag of that much a few years back, these condos had to be top of the line and the nicest of the nice. If you are looking for truly luxury living, Wild Heron is the place to be, what’s more, this place has just been reduced from $289,000 to $249,000! Here’s the video, you’re looking for deal number 3.

Notes for the Wild Heron deal:

  • List Price: $249,000
  • Square Feet: 1,711
  • Price/SqFt: 145.53
  • 3 Bedrooms, 3 Bath
  • Built in 2004
  • We are no strangers to Wild Heron, and that community is so HOT right now with over 12 closings in there so far this year. Of course, with prices like this, its no wonder, these condos are top notch, from the ground up. And the community is second to none in Panama City Beach, truly one-of-a-kind with superb amenities that emulate a lifestyle that at one point would cost you close to a million dollars to buy into. This condo is a one-owner, live in that has been spectacularly taken care of. This is a short sale listing, that is actually Karen’s listing, and I’ve been told the bank is being very communicative.

Deal 2 – Splash, Gulf-front for only $254,900

The first deal is a condo in Splash, well known for the family-friendly atmosphere and the fun, covered water-slide area for the kids. Located on the quiet west end of Panama City Beach, this is a great condo for rentals. Here’s the video (it is deal number 1):

Notes for the Splash deal:

  • List Price: $254,900
  • Square Feet: 1,074
  • Price/SqFt: $237.34
  • 2 Bedrooms, 2 Bath
  • Completed in 2006
  • Splash is well known for its stellar occupancy rates. The first summer season it was open to the public (I think 2007) I interviewed the GM of the onsite rental manager and he said they averaged 90% occupancy all summer. This is a foreclosure listing and the cheapest in the building (per sf). The condo is in good shape, although it needs some appliances. You’re paying for the amenities and the best rental capability on Panama City Beach.

Deal 3 – 2 bed 2 bath Gulf-front for $200,000 – wow!

Ok, so talk about a smokin’ hot deal. This is a gulf-front condo at Sterling Reef (at the end of Alf Coleman Road, that Shipwreck Island Waterpark is on) in central Panama City Beach that comes fully furnished and ready to rent. And at $200,000, you just can’t beat this deal. Sterling Reef is adjacent to the new county pier that’s quickly growing into the gulf, set to be complete by this time next year. In addition, you have around a quarter mile of white sandy beach to the west that is county owned and won’t be built on. Here’s the video, look for deal number 3:

Notes for Sterling Reef:

  • List Price: $200,000
  • Square Feet: 1,076
  • Price/SqFt: $185.87
  • 2 Bedrooms, 2 Bath
  • Completed in 2005
  • This two bedroom two bath gulf-front condo in Sterling Reef comes fully furnished and rental ready for only $200,000. If you are looking for something right in the middle of all the action that’s ready to rent as soon as you close, this is the one for you. This is a short sale listing and we should note that there is a third party short sale negotiator involved that requires a 1.5% buyer fee paid to “The Short Sale Guru”, which, if sold for $200k would only be $3,000, still cheaper than anything else listed in this building.

The Mystery of the Term 'Condo-tel'

Since I am getting so many questions these days regarding condos and condo-tels and since the secondary market for these properties, i.e. Fannie and Freddie, has all but disappeared, I thought I would try and clarify why a project will or will not fly. First, a condo-tel is not a new concept. It has always been a type of property designation we use along with single family detached, duplex, etc. The problem is that for many years, Fannie and Freddie did not adequately identify beach-front, resort-style condominiums for what they really were. So what makes a condo-tel? Actually, any number of things. I have heard many times that a project is not a condo-tel because it doesn’t have an on-site rental desk. While an on-site rental desk would classify a project as a condo-tel the absence of one does not make it immune. If they have a website that advertises rentals it is a condo-tel. If an owner is required to rent per the bylaws it is a condo-tel. If it has daily maid service it is a condo-tel. So if a project doesn’t have any of these things then it is okay with Fannie and Freddie and fixed-rate financing is available? Not necessarily.

There is another classification we use for condominiums and this is the term ‘warrantable.’ Warrantable refers to whether it can be warranted as sellable to Fannie or Freddie meaning it meets their criteria for an acceptable condominium project. So what makes a condominium ‘non-warrantable’? If the developer is still in control of the HOA it is non-warrantable. If more than 50% of the units are investor owned it is non-warrantable. If one entity owns more than 10% of the total units it is non-warrantable. If the project has pending litigation against it or if a large percentage of owners are delinquent in their HOA dues, or any number of other factors cited by the appraiser can lead to a project being classified as non-warrantable. Every once in a while we come across a project that we can warrant but they are rare to say the least.

Between a project having one or more condo-tel attributes or having one or more of the non-warrantable attributes, you can see that most every condo here on the beach has no secondary market financing available. This is why a few banks like Vision have developed alternative vehicles to get these properties financed. Our portfolio 3/1 and 5/1 ARMs are not a panacea. Yes, they carry a certain amount of risk and the rates are at a premium over the current thirty-year fixed-rates, but, in the absence of a secondary market, these ARMs are the best alternative for providing financing to the buyer while protecting the bank from interest rate risk and meeting our future capital requirements. It is our hope that in there will eventually be a thawing in the secondary market for condos and that our products can provide a bridge to that future. In the meantime, we will continue to lend on these properties because we have a vested interest in seeing them sell and we have a firm belief that the collateral is sound.