The Florida real estate market was particularly hard-hit, even devastated, by the implosion of the housing bubble that characterized the past 10 years. The Miami market, like all urban markets, saw sharp decreases in home value, an increasingly tight credit market and the loss of jobs and reduced incomes caused many homeowners to put their homes on the market or, in the worst cases, fall into foreclosure and end up moving not of their own accord.
In Miami, investors have shown significant interest in purchasing distressed properties. Distressed properties are those that have fallen into foreclosure and are usually available at significantly discounted prices compared to their standard market value. Banks generally want to unload these properties as soon as they can and savvy investors, looking for a way to turn an economic tragedy into a source of new opportunity, have begun to take an interest in these properties.
Homeownership was touted, especially over the last 10 years, as the most sensible dream of any responsible American. However, many individuals-the majority, in fact-in the US are renters. These individuals prefer the freedom and excitement that comes with being able to change homes for only the cost of another deposit and the move. Investors in the South Beach, Miami Beach and Sunny Isles, Florida region seem to have noticed this market on the edges of their radar and realized that there is potential profit to be made in providing for the needs of this segment of society.
While owning a seaside home may be out of the financial range of most Americans, rending one may be well within it. Investors purchasing the distressed properties left in the wake of the real estate bubble’s utter collapse have begun purchasing these properties in the aforementioned areas, oftentimes at surprisingly low prices, and turning them into rentals. As more Americans have come to view a mortgage as a not-entirely positive way to manage their money, the market for rental homes is sure to increase. Purchasing these homes at distressed property prices and converting them into rental homes not only helps the investors, it helps many families get into a new home and possibly one they could never afford to purchase outright.