Aventura, Miami Beach & Sunny Isles

Forget about shopping for a condo, now you need to shop for a building!!!


Sitting down with a cup of tea in hand I opened the Miami Herald Saturday morning, to see a blaring headline…”New rules raise bar for condo mortgage”

I got to thinking about the gist of this article and how was it going to impact our already suffering values of property. The new Fannie Mae guidelines in essence say that in order to qualify for new financing:

1) At least 70% of the units in a new condo building must be presold
2) No more than 10% of units can be owned by a single entity
3) No more than 15% of units can be more than 30 days past due on association fees.
4) No more than 20% of a condo can be devoted to commercial space
5) All condos new and old, must have fidelity insurance, which protects the association funds from fraud.
6) The seller is not allowed to help with down payments or offer other perks like deductions of association unless they are disclosed.
7) Condos must have hazard insurance
8) When investors buy in established projects, at least 51% of units must be owner occupied.

The article continued to debate whether this is good or bad. (Most contributors and Realtors quoted were saying it was disatrous) . Are we being a little too strong a little too late? After all it was not the condo buildings that got the market into this mess. It was the practice of easy lending that allowed buyers to purchase properties way beyond their means.

Now when a buyer is interested in purchasing a condo they first have to sort out which buildings are even viable options. It is very important that a Buyer work with a Realtor who is current with their market knowledge and knows the financial conditions of neighborhood buildings.

For those of you cash buyers, this news is like winning the lottery as your buying power has just exponentially gone up and you will have great power when it comes to negotiation.

Written By
Debra Golan
The Golan Team
EWM Realtors
786-333-6200