Fraud case tied to escrow checks [Central Florida]

Fraud case tied to escrow checks

Mark Brady seemed to have it all during the real estate boom — two title companies, BMWs, a Hummer, powerboats, a $2 million home on Merritt Island, an oceanside condominium in Cape Canaveral and three other riverfront properties.

Then, two days before Christmas, Brady was arrested — charged with illegally using $80,000 of his clients’ money from escrow accounts to pay off gambling debts in the Bahamas.

Brady pleaded not guilty and was released on $8,500 bail. Hearings and sworn testimony are scheduled to begin in November.

“This is a victimless crime,” Brady told FLORIDA TODAY by telephone from a cruise ship.

There’s a new player in South Florida’s condo market

There’s a new player in South Florida’s condo market

Starwood Capital Group will wield new influence over South Florida’s condo market after it won an auction bid for the Corus Bank condo portfolio from the FDIC.

South Florida’s battered condo market just got a major new player.

Starwood Capital Group’s deal to acquire a big stake in a basket of condo construction loans and projects of failed Corus Bankshares from the Federal Deposit Insurance Corp. puts the Greenwich, Conn.-based private equity giant in charge of roughly 21 percent of the unsold condo inventory in greater downtown Miami. That makes Starwood the second largest force in downtown behind Jorge Perez’s Miami-based Related Group, which held about 3,000 units at the end of the third quarter, or 36 percent, according to new research from Condo Vultures.

Corus’ $4.5 billion portfolio included about $1 billion in loans secured by condo projects in South Florida, almost all in varying states of distress. The rest of the loans back projects elsewhere in Florida and in Las Vegas, San Diego and Atlanta, among other spots.

One of our best-kept secrets: Renting

One of our best-kept secrets: Renting

Dear Bruce: Can you tell me your thoughts on owning versus renting? My girlfriend thinks that renting is throwing money out the door. I think that there are more costs to owning than she realizes. — Mike, via e-mail

Dear Mike: I don’t know what your girlfriend is thinking unless she has the ability to throw out a tent in the park: Some way or another, she has to pay for shelter. Often, renting is a great deal less expensive than home ownership. There is a whole generation out there, up until a short time ago, that was persuaded that real estate has to go up in value. There are a lot of folks out there are finding out the hard way that’s not necessarily true. In other words, you would owe more on a house or condo than it is worth. Tens of thousands of people are in that position right now. You have to objectively start to figure the costs involved. In the case of a house, not only the monthly payment, the lost interest on the down payment, insurance, taxes, maintenance, utilities and all of the other costs, often time exceeding by a great deal what you would pay per month for a rental. As a matter of fact, renting has been one of America’s best-kept secrets. Many times over the last several years, the guy renting and saving the difference between all of the costs in owning is way ahead. On the other side of that, right now there are a great many solid real estate bargains out there. This is not a simple equation, but to find the right solution it is necessary to consider all of the factors that I have mentioned.

Real estate flippers back in South Florida, but this time they could help

Real estate flippers back in South Florida, but this time they could help

The flippers are back.

Bolstered by swelling foreclosures and bottomed-out prices, investors are returning to the South Florida real estate market, snapping up distressed homes with cash payments for either a quick turnaround or a short-term rent-then-sell investment.

Unlike the speculative flippers during the boom – scourges who unnaturally jacked up prices, spawned reality TV shows and led to the economic crumble – today’s flippers are erudite capitalists who could usher in positive change by buying dilapidated and abandoned homes, patching them up and selling them for a market-bearable price, experts say.

The downside: These cash-in-hand guys are competing with regular folks looking for deals and struggling to find loans.

First-time homebuyers buoy market

First-time homebuyers buoy market

The housing market is getting a much-needed boost as first-time homebuyers rush to take advantage of an $8,000 federal tax credit that is set to expire Dec. 1.

The incentive is helping to slow the decline in home sales. In August, sales were down 1 percent over the comparable period last year, the smallest year-over-year decline in any month since late 2007. As Congress considers extending the credit, real-estate agents and home builders worry sales could slump again if it’s allowed to expire.

A full accounting of the program’s popularity won’t be available for several months, but brokers say first-time buyers have been driving much of the activity in the market in recent months, especially for cheaper homes.

Kelly Cobb, a broker with Fonville Morisey Realty, said four of the six listings her office put under contract in the last month involved first-time buyers. Cobb said that as the deadline gets closer, she’s seeing more lower-end homes with multiple offers on them.

Richard White: Complying with Florida statutes is recommended for associations

Richard White: Complying with Florida statutes is recommended for associations

Question: I have written to you previously about a potential vote our condominium complex entertained to opt out of the state statute. This vote for opting out was recommended by our management company. Well, the condominium members did vote to opt out. What is your take on this issue? Personally, I favored staying with the Florida statutes, but it is difficult to read and understand. I think most people were confused and just voted along the lines of the management company recommendation. I could be wrong, but I think the statutes are developed to help and protect the condo owners and staying with this statute was the better option. The condominium attorney tried to explain the statute in an unbiased manner. I would like to hear your opinion of this situation. — H.E. / Naples

Answer: Keep in mind that there are only a few things the association can vote not to comply with in the statutes: Reserve budgets, annual meetings, audits and a couple of other operational matters. You cannot just vote not to follow or comply with the statutes, but you can vote on specific items as listed. I am surprised that a manager would advise to opt out of statute requirements. Take the reserves for example. To vote not to fund reserves, it must be done each year. Here is the problem. Say the association voted not to fund reserves over the years. A few years later, the association has no reserves. A disaster hits the association and the board needs a special assessment. It leaves the board and manager open for a lawsuit by an owner. That lawsuit could claim that the board and manager did not properly prepare a budget that included reserves. While the board can claim that the members voted not to collect reserves, it is a defense that could be overruled by a judge. I never recommend that members vote not to comply with the statutes.