DOUGLAS HANKS, dhanks@MiamiHerald.com

For about a year, so-called vulture funds have circled South Florida's besieged real-estate market, waiting for enough carnage to force deep discounts on large blocks of unsold condominiums. Some think last week's meltdown on Wall Street may herald the arrival of that moment.
As many as 100 investment funds are shopping for South Florida real estate, hoping to buy extremely low during the current crisis. Their main target: condominium towers where developers and their lenders can't sell enough units to pay off the loans used to build them.
"The bottom fishers, if you will, have been standing around the sidelines," said Victor Lopez, a former Hyatt development executive now assembling commercial deals. 'A lot of people out there are saying: 'This is our time to get in.' "
If he's right, it would be one of the clearest signs yet that South Florida's beleaguered real-estate market had bottomed, bringing the region closer to a recovery. If vulture investors are buying, the view goes, it's safer for others to start buying as well.
The funds come to the table with cash, but also a catch: a demand that the developers and banks accept a deep discount, typically between 40 and 50 cents on the dollar.
Despite all the attention these funds receive in the media and in real-estate circles, only one or two significant bulk condo deals have actually closed, according to several people involved in the market.
"Literally, a day doesn't go by that I don't get a call from potential investors," said Ramiro Ortiz, president of Coral Gables-based BankUnited Financial. "The problem is that the price is 50 cents on the dollar. I've got enough clarity to know that's not what I want to do."
Real-estate analyst Michael Cannon sees the fund industry overstating the crisis facing developers and their lenders. So far, he is seeing enough condo buyers closing on their units to let most developers pay off their construction loans as well as some of the secondary loans needed to build the projects.
"Nobody is panicking," Cannon said. "It's not there."
But after concluding the most dangerous week for the U.S. financial system since the Great Depression, fund managers think they are left with more leverage.
"Two very large hedge funds called me yesterday. Literally, they're flying into Miami," said Gregory Rumpel, a hotel broker at Jones Lang LaSalle, the day after Lehman Brothers filed for bankruptcy. 'These guys are saying, 'Well, that's probably the shock to the market -- with Lehman and all the other jitters out there -- we need to see some stuff released.' "
VULTURE IN LIPSTICK
One senior lending executive at a major South Florida bank that he wanted to keep anonymous said his staff so far has refused offers from the so-called vulture funds. But he predicts that resistance won't last much longer.
"The market conditions don't seem to be improving. At some point, you've got to cut and run," said the executive, who spoke on the condition that his name not be published. "That vulture is starting to look a little bit like it has some lipstick on it."
Some think Wall Street's grim news will prove a wake-up call to the fund managers themselves, prompting them to decide that the debacle has climaxed and that it's time to deal.
"When you talk to most of these vulture-type investors, they all say they want to buy when there's blood on the streets," said Peter Zalewski, a partner at Condo Vultures, which brokers sales of distressed condominium towers. "This is really the sign they've been looking for."
TURNING POINT
An actual turning point wouldn't reveal itself for months as the complicated deals, involving dozens of condominiums, get finalized.
"We've been active in this market for almost two years now," said Matthew Martinez, whose Coral Gables firm, Pangea Select, is helping funds shop for South Florida real estate. "We've made about 32 offers. And we're closing on the first one as we speak."
Fluctuating currency markets add to the urgency for many of the funds with investment dollars from overseas. "Israel's here in a big way," said Adam Greenberg, managing director of BayBridge Real Estate Group, which is representing about a dozen funds.
Peter Wells wants to spend about $600 million in investor dollars and borrowed money on Miami-area real estate, but so far, he can't find a motivated seller. He's a partner in Condo Capital Solutions, a Denver-based fund that is looking for bulk deals in Florida and Arizona.
"We're starting to see a few deals that are starting to make sense," he said. Banks "are now starting to get a little bit more realistic."

Lease-to-buy options, an option to consider.
This is not a new trend, but it is now gaining speed. Lease-options give renters the option to buy the property at the end of their lease. So, for those who are considering to purchase a home, but are not yet fully decided, this option allows renters to give ownership a test run. Generally speaking, under most lease-to-buy option contracts, the renter is the only who has the option to buy the property for the specified period. Of course, there are different ways to set up these contracts and many are drafted with different terms, but usually, this is the case with the renters. Additionally, a fraction or portion of the rent is for building equity and at the time of purchasing the property, it is applied toward the down payment. Also, in many lease-options, the renter can buy the home at any time during the contract.

The South Florida Boat show turns 15 and it is just around the corner, just in time for Father's Day. It will be held from June 13-16 at the Miami Beach Convention Center. So, come make a splash, create some waves and embark on your dreams.

It is true that the market has changed. But, markets always change. This is intrinsic in any and all markets. It is also true that the glass-is-half-empty perspective always grabs bigger headlines and creates physocoligical repercussions that are often based more on hype and opinion than facts alone. We must  take into consideration when talking about the market today, that affordability has improved greatly, especialy in those areas where affordability was the concern or talk of the day. Not only is affordability better, but mortage payments on a typical home are as well. According to various sources,  typical home mortages today are on average around 20% less than a year ago. So, we can also talk from the Glass-being-half-full perspective. During the REALTORS® at NAR's Midyear Legislative Meetings & Trade Expo held in May 2008, NAR's Chief Economist Lawrence Yun shared with realtors, peers and colleagues alike that during the past seven months, home sales have even out and that they should grow somewhat during the second half of the year.

Selling price is not really selling or marketing. One needs to sell value. Value is the intrinsic benefit of property ownership. Value is inherent any sales negotiation or transaction, no matter the industry, no matter the trade. If you must rely on price alone, you will be priced out from any deal

Overall, that depends on the individual. The question should be is this the right time for me to buy? However, in general, and weighing all the facts and circumstances, I believe this is a good time to buy. There are great opportunities out there. There is more room for negotiation. There is much less speculation. There are less bidding wars. We have to remember that the market, like all markets, goes in cycles. In the end and despite the cycle, real estate tends to appreciate as time passes. Besides, solid urban areas, in other words, those sprawling cities that have solid properties and credible developers, will usually increase in worth with time.

But, of course, everything is case by case and one should make the decision for one's sake. 

Lately, many people have asked me what is a short sale. In a nutshell, a short sale is when a property is sold for a lower price or amount of the mortgage owed on it. Sure, a lender agrees on a lower term or payment settlement to expedite the sale. But, the process can be an arduous one and may take months before it comes to fruition and completion. Both the seller and the buyer must be patient and diligently do their respective homework when it comes to a short sale transaction. A seller can't automatically assume that the creditor will consent to a lesser defrayal just because he/she is late in payments. The creditor usually requires complete financial disclosure from the seller, and may want to learn if seller has additional assets. A seller in a short sale has to fill out lengthy paperwork, and be subjected to all the terms and requirements set fourth by the creditor. Once and only once the lender approves can the short sale process commence or shall we say continue. By the same token, a buyer can't assume that he/she will automatically get the property. As a matter of fact, even if the buyer is willing and has offered full price on the property to guarantee the purchase, there is no guarantee. The lender must be in accordance and accept it.

Hello from Miami Beach, hope you all are enjoying Memorial Day. Perhaps, you soon will be able to come to Miami Beach and enjoy the sizzling lifestyle. CHEERS!