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When Brazilian Model Brothers Come To Miami And "Buy To Rent", The Top Is Near
The theme of buying real estate to rent out is nothing new, in fact courtesy of the government subsidized securitization gimmick known as REO-To-Rent, America's biggest asset managers have been able to load up on real estate virtually cost free, and hold on to it in hopes of renting it out to a US consumer. Alas, there is a qualifier: the "tapped out" US consumer. Case in point is Och Ziff, which as we wrote, after dabbling in the space for a year, has called it quits, and pulled out of the REO-to-Rent game. And they are the smart money, which means the returns for everyone else are only "downhill from here." That said, for now the meme is one of renting. In fact, as Reuters Insider points out, "Renting is the new American Dream." The problem is 'owning' was the old one. That ended in tears. This one will be no different. The only question is when. We think that when Brazilian model brothers come to Florida to buy up condos so they can rent them out, that's about as toppy as tops get (It is unclear if the two models also demand to be paid in EURs back in the homeland, like another infamous topticking supermodel and financial expert).
Incidentally, to all those who claim the US demographics will spur demand for housing, here is a fact: in the US 21% of young adults now live with their parents (a number which has soared in recent years). In Italy: the number is 33%. Point being there is much more capacity in living with mom and dad before the US has to be really excited about demographics driving demand. Because at the end of the day, it is not about demographic demand on the margin, but the cash flow said demographic is making. And with rents soaring, while average hourly wages are plunging, the cash flow just is not there.
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The property market is fucking crickets. I want to go home (no pun intended)
"with rents soaring, while average hourly wages are plunging, the cash flow just is not there...bitchez"
Sooo... you saying people will default on their leases just like previous owners defaulted on their mortgages? And another leg down in home prices as these Corps. start unloading? Sweet.
That or we go back to the absentee landlord system with federal enforcement of rents.
What is interesting about this post, is when you consider real estate prices in the larger cities of Brazil and compare them to those in Miami, you recognize that either Miami real estate prices are still way undervalued on a global scale, or urban Brazil real estate prices (and much of the rest of the emerging markets) are way overvalued. Because while 'the cash flow just isn't there in America' as Tyler suggests, the average professional wages in America are still multiple times higher than Brazil, China, or just about anywhere in the world. Yet, today you will pay more for a condo in San Paulo than Miami and these models know this. Buying to rent in emerging markets, you pay $250,000 in an area where white collar professionals make $1500/month. In Miami, pro wages are closer to $4000/month and condo prices $150,000. So maybe these Brazilian models are foolish, or maybe not. If famous American models were buying, I might consider calling a top here, but I don't see a top in Miami prices today, especially when compared to property around the world. And if you are Brazilian looking to park cash in a market that offers safety of ownership and positive cash flows, buying to rent in Miami is not the dumbest investment out there. What would you have them buy instead Mr. Durden? Stocks? Nope, ripe for a crash at any moment. Bonds? Nope, pummelled by inflation with no yield to reward the risk. Gold? Maybe, but still no yield and we are near all time highs. Sure, own some gold but putting 100% of your money in gold is foolish in my view. Oil? Maybe, but oil can crash hard during tumultuous financial times, it could easily drop by 50% in a month if/when another big crash occurs as it did in '08. Food and farms? Good choice, but a pain to manage and illiquid when you need cash. That leaves, er... condos in Miami as the cleanest dirty shirt. OK, if you believe in Armageddon, that is fine by me, buy some gold and some canned goods, find a cave and go hide in it, live your life in fear. But if you want to make money and build wealth, you have to face down the Armageddon risk and place your bets when times are tough. Miami condos will out perform many asset classes over 5-10 years, given the limited downside risk combined with ultra low interest rates.
That's because Miami druglords, pornkings and stock scammers are buying the expensive properties in Brazil. They pay cash from their stash and always have a one-way ticket to paradise. Multiply the rot from Miami by every major city on the planet from Moscow to Sydney and you have a population that fits into the new developments in Sao Paulo or Rio. Location without extradition preferred!
Miami was a hot commodity with Russian buyers for long. They're not renting from Brazilian models though. They pay cash. Doubtful there are enough quality renters for the Miami condo market. If they can afford to rent, they can afford to finance and own the digs. It makes sense most of the time unless they're a fly by night setup and that's not quality tenantship.
Yup, I call top on the Miami condo bubble. It was hot until it's not. 2 modelos from Brazil are not going to change the trend.
You make a good point, and I can tell you that Brazil isn't the only country that's in the midst of a real estate bubble similar to what befell the US just a few years ago.
These Brazilian models or modelos should buy Apple. Apple is the "American Dream."
Fabio's ugly cousins.
Its not a top until the models have blond hair, 44-D silicon implants, buts bigger than Kim Kardashian, and make less sense than the female calling in to the radio show requesting that deer crossing signs be placed in remote urban areas instead of along the interstate.
Only until the last of the Pure Full Retard's have dived into the Miami real estate market will we be able to call the top.
A very good comment. Consumer debt in Brazil has gone crazy, as the following article illustrates.
http://www.ibtimes.com/brazil-shows-how-too-much-consumer-debt-can-threa...
A big part of the problem is the muppets following the BRIC meme searching for investments, pushing easy credit into the hands of consumers who lack the actual income to deal with the debt.
I get what youre saying, but white collar workers make more than you think in brazil, wage inflation is high and often govt mandated. Sao Paolo is more expensive than Miami, though.
Also, white-collar residences in Miami do not cost $150k either. Thats closer to what theyre worth, but professionals live in neighborhoods where condos start at, rock rock bottom, $220 and go to pretty much infinity with alot in the $300-500K range. The problem is that professional neighborhoods are very proximal to enclaves of the super rich, who do not have to make a living in Miami to drive up prices there.
Another reason miami RE does well is the threat of "nationalization" when the boom is over. Argentineans and Venezuelans arent in the situation Brazilians are, but they are all over condos.
Incidentally, to all those who claim the US demographics will spur demand for housing, here is a fact: in the US 21% of young adultsnow live with their parents (a number which has soared in recent years). In Italy: the number is 33%.
Indeed. I was talking to my father a while back and he was very interested in yield-seeking via rents because he sees where his retirement funding is going. I couldn't stop reminding him that it was not going to end well. He's since decided on productive land.
The advantage of the residential rental is that financing is available for the residential at about 3.5% with 30% down and for 30 years. And there is no funding necessary to buy equipment or put out the crop. Sure it is possible to finance the farmland, just not as attractive terms. Consider that farmland prices are at all time highs and he will be bidding against the local buyers who will pay a premium for the "farm next door."
Where do those rates exist for the non hundred million dollar buyer of rental property.
First, I haven't seen a 30 yr loan option for a rental, second, you won't see a 3.5% rate for a term of 15 years unless the property is well into the millions. I refi'd a property around $500k, appraised value of $740, best "fixed" 15 year rate I could find was 4.5% earlier in the summer. I say fixed, there were some five year balloons around 3.9%, some three years balloons around 3.7%. I found two 20 year fixed loans, both bumped the rate up a solid 1.5%. I really try not to get too caught up in the rate as it wasn't that long ago the above mentioned property was 8%, and it wasn't a problem.
I just did another property with a 5 year balloon at 4.61%. The kicker is my closing costs, counting appraisal, were under $1k using a local bank. I have a friend who is newer to the rental market and paying over 6% rates on sub $100k property.
I've got one option that does over a 3.5% rate on properties of 4 units or less with 25% down for a fixed 15 year term. Closing costs are high and you can only have four of the loans. I'm going to build a 4 plex in the spring.
A joe blow walking into a bank to purchase thier first rental property is going to pay over 5% for 15 years on balloon terms more than likely. The only way they are getting a better rate is to lie and say it is a primary residence and never move in. This isn't a bad lie by the way.
I've seen 30 year amortization on rentals at about 4.25 recently.
Also one could consider buying as primary residence, living for a year, and then renting. Upside is better financing terms but you would have to move a lot.
Through who? I've done the converting primary to rental thing, you better be ready for a major pain in the ass when you go to buy another primary in a year. Thing is, 90% of people won't have enough income to show for a bank to loan them the money on another home due to the fact the rental doesn't have two years worth of rental history.
I know a guy with around 120 single family homes, and two small apartment complexes of around 40 units total. He uses only a local bank now for many reasons, main one being he can go get his equity without pulling all his hair out. I can pick up a phone and within two weeks go to the bank a sign refi paperwork. I know his interest rate for 15 year fixed loans and it isn't as good as the 30 year rate you posted, though most of his properties are on a five year balloon.
"He's since decided on productive land."
You know things are tough when vegetables are driving economic decisions.
I went thru a broker who will re-sell, so not sure who will actually hold paper. Might be Fannie. Agree on the pain when going to buy another primary after a year. It all depends on debt/income ratio and existing assets. If you have a solid income plus assets, they will play ball.
True they will play ball, but it can be a pain and they want 30% down.
Time for a reality show...
"Rent that REO"
In the meantime, JHK's prediction of the suburbs become slums is being bourne out, these REO renters are the next generation of slumlords...
Apparently Brazil has a different standard for "models."
and don't forget dem mexicans. they live like 6 or 7 in a 3 bedroom house. just like the clowns in a VW at the circus
Yeah I have a family of salvadorians next to me that are living 13 in a 1900 sq ft townhouse. The roaches they have living with them aren't being counted incidentally since they migrate from their house to mine nowadays. The city of manassas park will do nothing since apparently they are all 'related'. They know how to work the PC system. Don't even get me started on the other 94 homes in my hood with at least a 50% section 8 ratio. Good times bitches. Good times indeed.
My family is a family of 7. Me, the missus, and 5 kiddos. 3 bedrooms. One is more of large closet though. fun times.
these people aren't related
bullshit!
They can sustain rent my dick!
Why not go home? My Mom has kept my room just the way i left it.
Hey, besides, its Agenda 21- let's cram an extended family of 16 into a suburban ranch-style house. It 's "sustainable".
Yep.... that's it, it's an Agenda 21 thing.
You are giving Glen Beck a run for his money in the stupid non-sequitur division....
Let me guess, you also think Sarah Palin in an authority on energy issues....
I'm not sure that he was suggesting that moving back in with parents was driven primarily by Agenda-21, just that it fit the cause.
At least Palin was not running Stuxnet in the Golf of Mexico like the Muslim.
Are you trying to troll yourself???
Local US economies won't support rising real estate. Banker influence is limited when people just can't buy a house. Renting is warning signal not a buy signal. When no one is buying and no one is renting, that will be closer to the bottom. there is plenty of room for contraction via squatting with family and shanty town/favela living.
There are only two options in a declining US reserve currency world where all other currencies are also declining. Gold, hard US priced assets, and US stocks. These will get anti-currency capital flows. It has been the same story since 2009. I don't see any changes. The reason I say US assets is that the US will likely maintain market integrity long after the other global currencies scare everyone into running for the door in those locales.
The Flip-to-rent hedgefunds like Blackrock, buying 1K from the GSEs deserve to lose their asses! Free money has builders now overbuilding the apartment market too, it took how long? 1 yr? FUCK ALL THESE FREE MONEY SPECULATORS!
PUT BERNANKE IN PRISON!
RV bitchez.
"America is moving to a rentership society"....my ass! America is heading to the poverty society.
Yes, why you ask? Because wages matter.
We may not fully realize it, but the reality is that we are currently witnessing the end of ownership. People do not own the political process(they have no real choice other than the one they are served) they do not own their cars (leased), they do not own their houses (rented, in forelosure or underwater), they do not own their bank accounts( Bernanke pays less than inflation rate), they do not own their privacy (big brother is watching and reording everyone and everything), they do not own their borders (everyone and everything from illegals to drugs can get in), they do not own the right to a job (because big business can export factories to maximise profits)........and they do not own their lives because the preident can decide to have you terminated without any process whatsoever.
All of you are belong to us!
+1 You don't own land either...(see Kelo vs. City of New London)
People in Cleveland own their Obamaphones.
Too many people take too much risk by relying on two incomes to buy a house. They'd be better off using just the man's and buying something in that price range. That way if he lost his job the woman could enter the workforce and supplement unemployment and they wouldn't lose the house. But now if either lose a job, they lose the house, and most in that case also divorce from the stress.
HOWEVER if they LEGALIZE PLURAL MARRIAGE problem solved. If I had seven wives I could buy a nice big house and rely on 1/2 of their incomes to pay for it. Nice part would be when one gets pregnant and leaves the work force others are already picking up the slack and would help with kids, like a live-in-nanny. Heck most could work part-time raising the kids, the housing would be paid for after 10-15 years, and any unemployment could easily be weathered by the other income streams.
Don't know if you are genius or insane but +1 for you. I'm not buying that circus but it sure would be fun to watch...
operari sequitur esse
"it sure would be fun to watch"
Oh, yeah, we need another reality show, like SO badly...
My pops just bought a nice 3 bed, 2 bath split-level in the area. Paid cash with the intention of renting it out. He fixed up the house nicely and then set out to find a renter. After some time riffling through the numerous deliquent borrowers with liens all over their financial history he has decided to put it back on the market. Tapped out consumer indeed.
Live in the upper Midwest and can tell similar tales from close friends: either terrible tenents or no renters. "Best move" recommended from these people: get signed up for section 8 housing. Rent is guaranteed. My best move recommend for them is buy some acreage.
Section 8 housing coming to your neighborhood soon. We shake our heads at the idea of 'obama-phones' wait until your neighbor is talking about getting free 'obama-home'. Just the type of neighbor you were hoping for, right?
In LA the waitlist for Section 8 is 10+ years.... unbelievable. Permament moochers who never get off of it.
The single family home next to mine has had the previous two tenants removed for non-payment. Sad to see, especially for the kids.
he could've gone Krugman Style and burned it down causing the insurance bank to print more dollars and create labor demand to rebuild it. this economy shit is so easy, even a moron can do it.
keep obama in president
ya know!
make he a king also
In fact, as Reuters Insider points out, "Renting is the new American Dream." The problem is 'owning' was the old one. That ended in tears. This one will be no different. The only question is when.
Well, everybody has to be in one trade or the other at any given time. There is no "on the sidelines in cash" position here (unless the government is letting you stay in your home cost free or providing you with other shelter).
Even the recent housing bubble only boosted the US home ownership rate from a long-term level in the low-mid 60s to ~69%.
Unfortunately, wages matter. - FAIL.
Cash flow real estate will still be good in selective areas and price points. One just has to be able to read a simpe income statement and determine cash flow and ROE.
Personally I think it is better to play small ball (inexpensive homes or 2-4 unit dwelling) and diversify within that demographic.
When are you guys going to drop 'Magnum' on us?
Living in your mom's basement is the next American Dream.
And the one after that will be living in a van down by the river.
pods
Riverfront is highly desirable!
Park here first before you get .. you know the rest
If the river floods, just drive away!
Essential Nexus...not quite, more like your mom and your aunt and her cancer riddled partner/husband will be living in your basement, on your savings.
The problem with rental properties is rent generally can't keep up with rampant inflation (let alone hyerinflation), and this is compounded if the property was financed. Not that we are in danger of inflation, CNBC told me there was none the other day, so I'm really worrying about nothing.
With falling world trade, surplus shipping containers might be a wise investment. They are stackable and make excellant homes.
http://weburbanist.com/2009/12/07/20-shipping-container-cities-apartment...
BDI has been surging lately.
http://www.dryships.com/pages/report.asp
After hitting all time lows during the summer it's been going up steady.
Brazilian models this guys?!!
Hey world contact me today i will skyrocket your sales and im not even a model :)
Did someone check the agency they work for, and where money come from ?
So inocent this video.
How much does it cost these days to rent a reuters tool to do some pumping propaganda? How about some highly selective anecdotal evidence?
0:36 - 0:42.....................The funniest six seconds in my life !!!!
you need to get out more
Hard to understand the point in the article.
'Americanism' is based on expansion and expansion is reaching the stalling stage due to lack of room to expand.
People who do not own large swaps of property will have to rent. So what?
It is quite easy to advance the 'american' middle class model of RE ownership when you have sponsors like the Indians who were so subjugated by the 'american' project of 'american' freedom, truth and justice, they decided to yield their land to support that humanity saving project.
But once you run out of Indians, then what?
Yeah, because Americans are the only society in history to dislocate an entranched 'civilization' to expand their own empire. You don't read history much do you? Not required as a professional troller eh?
The county assessor boards have to be licking their chops. More permanent obligators to pay their mill levys, and thus county bureaucrat salaries.
This too will all end in tears. Half will be dumped in 10-15 years at a loss or flat.
Thanks Tyler for the post.
History: Stack & Heap
There are no freeways on the ocean. It makes no economic sense to ship raw materials across the ocean and finished goods back. What kind of societies tolerate that kind of accounting? Who is the 800lb gorilla on the sea, which sets the boundaries on land?
Foucalt: the underlying tendencies that gather force, and are then suddenly reversed after centuries of continuity, epistemological acts and thresholds (Bachelord), suspend the continuous accumulation of knowledge, and force it to enter a new time, with displacement and transformation (Canguilhem), due to microscopic and macroscopic scales of the history of the sciences, detaching science from its ideology (Serres), the limits of the process, the point of inflexion of a curve, the inversion of a regulatory movement, the boundaries of an oscillation, the threshold of a function, the INSTANT at which the circular causality breaks down, what series of series, what tables it is possible to draw up (Marx), a consciousness turned upon itself, rebuilding foundations, after ideological use of history by which one tries to restore to man everything that has increasingly eluded him. (Man plans, God Laughs)
Barzun: In advanced civilizations the period loosely called Alexandrian is usually associated with flexible morals, perfunctory religion, populist standards, and cosmopolitan tastes, feminism, exotic cults, and the rapid turnover of high and low fads – in short, a falling away (which is all decadence means) from the strictness of traditional rules, at Alexandria in the third century B.C. … as happened again at the tail end of the middle ages and again at the turn of the eighteenth century. The attic is crammed full. A healthy barbarian invasion may clear the air and the bookshelves for a fresh start.
Information theory, not interested in message, but in the chance of getting its ‘shape’ across, tries to dominate psychology, linguistics, and anything else in which meaning still lurks untouched by abstraction. The point of the game is what we all used to do as children – repeat a word over and over till its meaning is emptied out.
The upshot has been to regard all barriers as outmoded and unjust. The ever-present IMPULSE is to push against restriction and, in so doing, to feel intolerably hemmed in. Thus, in practice, every liberation increases the sense of oppression. ‘Don’t be left out of the period of pleasure.’
What this comes down to is the thing we today keep bleating about as ‘the search for excellence.’ If the motto is not hypocritical, it is certainly ineffectual. In higher education we give degrees that supposedly certify excellence and then require stacks of letters of recommendation in order to distinguish real merit from the rest. It has to be assumed, too, that among the letters there will be a truthful one to help us reach sound judgment. And still not content, we also ask for figures based on so-called objective tests. In short we cannot tell a good man when we see him.
It is a democratic spirit insofar as the passion for equality naturally stimulates envy and suspicion; but it is also a recast spirit in that it attributes virtues and violated rights to one group, wickedness and wrongful supremacy to another. In this sense, visibly, women are a race oppressed by the race of men; the old, the white, and the ‘bourgeois’ are races unjustly dominant over the races of the young, the colored, the poor, and so on down a long list.
What Western civilization is witnessing, in short, is the last phase of the great emancipation…and the structure of civilization no longer has either the faith or the power to sustain itself. Bargaining by outrage is an old game…and capitalism has been so modified that it is at many points indistinguishable from communism, itself also hybridized; teachers cannot be mass produced at will like cars.
[T]he present failure of authority is a prime symptom. It tells us that on the all-important question of how we live together, the contemporary world has not a single new idea to offer, not one. What is wanted is an open conspiracy of genuine Young Turks who will turn their backs on analysis and criticism and reinvent – say- the idea of the university, and show what it can do; who, seeing that bureaucracy is inevitable, will rethink the art of administration and make it work.
Gombrich: The Power & Perils of Hindsight. Critics…who had a professional interest in problem solutions…the assumption that any improvement must have been striven for…tended to reduce the history of art to the story of how the past strove to become the present. [H]indsight shows its power if it makes us pay attention to the reasons which secured such a rapid victory…
Lowinsky: The Peril & Profit of Foresight. The verdict went unanimously against Vincentino – an outcome that could have astonished only its victim, who underestimated the peril of foresight in an environment dedicated to the cultivation of tradition…in the risk of isolation. But the rejected pioneers of yesterday become the prophets of tomorrow…those who mastered all aspects of avant-garde technique but reserved it for special texts calling for extraordinary means. These masters reap the full benefit of the pioneer’s foresight; the early experiments now bear the ripe fruit of fully matured works.
“The sea yields the world to the world by this art of arts, navigation.” Purchas
Waters: While science is itself the product of civilization, civilization is, basically, the product of the activities of seamen sailing ships across the seas. The seas of the world are, as the Bible says, one – one great sheet of water enveloping four-fifths of the globe’s surface – yet, as Martin Bahaim declared on the first known terrestrial globe, everywhere accessible to men in ships…they have cross-fertilized cultures otherwise doomed to sterility and thereby conceived and given birth to new ones.
The unity of the sea divides the lands of the earth; ships unite them; only ships carry the cargo in the quantities and in the variety necessary for the sustenance and growth of the many societies scattered about the world’s land surfaces.
------
The US hasn’t had a private mortgage market since before the Great Depression. WSJ
“find out where God is working and join him there.” Blackaby
WTF was all that? Can I get the condensed version please.
the end of the road for consumers is the beginning of the next for the producers.
original question: how do you turn around a flattop, on a dime, at full speed?
answer: redefine relativity (assumptions).
most will simply follow and moan, others will dig their own grave, and the remaining minority will do, as always.
With local Florida cops slicing up tent cities with razor knives, maybe this rental farce has a chance.
I always take investment cues from Brazilian model brothers.
SOARING rents means cash flow is good tyler is lost on this one.
http://www.loopnet.com/xNet/MainSite/Listing/Profile/Profile.aspx?LID=17464841&SRID=2921635014&StepID=101
450k produces 60k a year pre tax
and if you buy it you get to write off alot of your expenses
FUCK GOLD!!!!!!
Is that 60K before expenses. Even so that is 13% and you have to deal with the jackoff renters. I AM GUESSING THAT IS WITH LEVERAGE TOO!!! My coins are compounding 19-20% a year since 2004. I don't have to lift a finger.
tr borrowing a couple million to buy gold using it as collateral
Investing in ATL burbs with a friend who is local w/RE, engineering background. We like this mkt bc houses are still cheap, good economy, right-to-work state with very strong property-owner rights. We've been buying REO's very selectively, buys very selectively at about 1 of 20 auctions he attends, knows what to look for. Buying these houses that sold for ~$130K in 2005 for ~$40-50K, putting in ~$10K of repairs, renting out for ~$850-1K/month to good working class family tenants, >20% gross yield. After 6% for the prop mgr, insurance, putting money in escrow for upkeep, conservatively assume 2 months vacancy, etc. the net yield should be 8-11% unlevered yeild after tax. Not bad IF the rents don't fall. But perhaps the rents do fall- in that case maybe we get a 5-8% yield- not the end of the world either.
Exactly the type of investment I referenced in my earlier comment, if you can find a good property manager, this market is golden for the small scale investor with access to credit who is looking for steady yeild with upside inflation hedged.
It has nothing to do with fundamentals or demand. Wages will catch up with inflation, rents are outpacing. Borrow in today's dollars pay back in tomorrows. Its a speculation not an investment.
I just wanted to remind everyone here that I'm open to equity partnership proposals, for my new Luxury-Tent-CommunitiesTM venture; it comes with its own Federal subsidy line, so it's practically a money machine.
The key to real estate (like anything else) is relationships. If you can find quality tenants for properties in your area then you are set. I find this to be easier with smaller properties. It makes sense to call a top on large massive apartment buildings and condos in massive markets, but staying local can still produce yield. I've also looked at renting prepper properties but can't find a way to make the dollars work. The three groups in this ridiculous report are not who I want to rent to. Job market is not improving and even if it did young adults and former homeowners will not rush out of whatever situation they have found, and ive found immigrants generally find friends/family and their own relationships/networks to live for extended periods of time. I'd much rather find a small family or working class tenants in a decent school district (similar to Yossairan's comments) and keep a longer term approach.
A ton of these condos are sold as decorator ready. The owners are calling in unlicesed workers to finish them out. They are going to have improperly installed tile floors and bad plumbing. The maintence fees to keep up with repairs will be horrific in ten years.
buzz buzz get the llello, rush rush get the llello. Alvaro Uribe's tonnage of years past via gulfstream. Yet Dolly Cinfuentes Villa knows nothing. The perpetual hustling of future generations.
This is more NAR propaganda video.
trying to target at the next wave of suckers "2014 defaulters" to think they're going to be come Donald trump landlords . lol good luck because most if not every listing oven seen priced over 4k a month in south fl is sitting on the market over a year if the owners don't drop to sute the renters budgets it will sit, their plenty of nice 4/5 bd sub 3k deals were the landlord is just happy to get money for mortgage paid and utilities out of his name, "remember a unrented home has electric bills as you need ac to prevent the mold from invading and FPL isn't cheep. so he'll eat the taxes, and up keeping fees, while praying the renters don't find a better deal and jump ship. renting is great it leaves us mobil and in charge. when shopping for a rental do your self and your money a big favor and stay as far away form the brokers/reps as their all hurting and making their moneys form the reveal markets now, i saved over 800 a month by slipping the owner my numbers and leaving the realtor out in the cold were he should be for trying to get me for the extra 800 for his pocket
These Brazilians need to also factor in the condo assoc fees, insurance, as you mentioned electricty, taxes, endless costs. If they go in with all cash they might make 4% on their money a year. Forget about appreciation too.
I bought a used truck off a Brazilian guy in 2005, I asked him why he was selling it. He told me he had 2 houses in foreclosure and another one that he couldn't fix, he was heading back to Brazil.
Some things never change.
One day we will return to multigenerational housing. Break this manufactured idea that you`re a loser for staying a home... that you need to move out and get a massive mortgage to buy a home/condo to finally become an adult.
Here's article I came across for UK via Economist
"The boomerang generation: Young adults have become reluctant to fly the family nest"
http://www.economist.com/node/21564601