U.S. existing home sales soared to the second-highest level on record in August, while prices took the biggest annual jump in 26 years, the National Association of Realtors said Monday.
Separately, Federal Reserve Chairman Alan Greenspan said "froth" in home sales may have spilled over into mortgage markets, as borrowers opt for exotic products such as interest-only loans. But he said the vast majority of homeowners, including those in the hottest areas, had sizable equity to weather a possible downturn.

The Realtors said sales of existing condos, single-family homes and co-ops rose 2% in August from July to a seasonally adjusted annual rate of 7.29 million. That's 7.8% above August 2004 and second only to June's 7.35 million pace. Condo sales surged 14.3% from 2004.

The median price for an existing home was $220,000, up 15.8% from the $190,000 of a year ago and the fastest annual appreciation since July 1979.

The group said Hurricane Katrina, which plowed into the Gulf area in late August had no measurable impact on the figures. The effect could be mixed ahead, with disruptions in the disaster area but higher sales in surrounding regions.

The market is being supported by 30-year mortgage rates of less than 6%. Economists were surprised by the strength of the report, though several noted the inventory of homes for sale rose to a 4.7-month supply, which could contain prices.

"Clearly, reports of the housing market's demise have been greatly exaggerated," says Stephen Stanley of Greenwich Capital Markets.

Sales declined 0.4% in the South. On an annual basis, sales were up 7.5% in the South, 8% in the Northeast, 6.5% in the Midwest and 8.3% in the West. Median prices ranged from $322,000 in the West to $176,000 in the Midwest.

Greenspan, quoting from a research paper he wrote, his first since 1996, said four-fifths of the recent rise in mortgage debt has come from borrowers extracting home equity. At least half the value of home equity loans and cash-outs has directly or indirectly supported consumer spending.

Still, less than 5% of homeowners have loan-to-value ratios exceeding 90%, with loan-to-value ratios lowest in states with the hottest markets. That means most homeowners have an equity cushion if prices fall, Greenspan said in a video speech to the American Bankers Association in Palm Desert, Calif. He said it was too early to tell whether the hot market was broadening or cooling.

With new evidence that the housing market remained red hot last month, Alan Greenspan said on Monday that the vast majority of homeowners are not yet stretched too thin.

Alan Greenspan cautioned about "exotic" home mortgages.
But Mr. Greenspan, the Federal Reserve chairman, warned that the use of "exotic" mortgages could be pushing prices higher and inducing some homebuyers to take on too much risk.

Even as he warned about the increasing use of interest-only loans and no-money-down loans, which can become risky if interest rates rise or housing prices fall, Mr. Greenspan argued that only about 5 percent of all families have borrowed more than 90 percent of the value of their houses.

"The vast majority of homeowners have a sizable equity cushion with which to absorb a potential decline in house prices," he said. Mr. Greenspan told a banking conference on Monday that speculation in the housing market may have spilled over into the mortgage markets as more and more people use interest-only loans and other techniques to buy homes they might otherwise be unable to afford.

"The dramatic increase in the prevalence of interest-only loans, as well as the introduction of other, more exotic forms of adjustable-rate mortgages, are developments that bear close scrutiny," he said.

Though such loans have appropriate uses, he continued, they could also provide a way for marginally qualified buyers to borrow heavily and buy homes at inflated prices.

"In the event of widespread cooling in house prices, these borrowers, and the institutions that service them, could be exposed to significant losses," he continued.

Though Mr. Greenspan said the vast majority of homeowners were not overextended, his comments on Monday were his sharpest warning yet about the proliferation of new loans that have helped push the household savings to a rate below zero. On Monday, the National Association of Realtors reported that the median sale price of existing homes hit a record $220,000 in August, up 15.8 percent from one year earlier.

Sales of existing homes climbed 2 percent in August and reached an annual rate of 7.29 million. That was just short of the record 7.35 million, set in June.

Analysts said there were some hints that the hot housing market may be cooling just a bit. The inventory of homes for sale edged up in August, and the amount of time that houses in many cities are sitting on the market is somewhat longer than earlier this year.

But many economists contend that a housing bubble is evident in many parts of the nation, especially around big cities on the East and West Coasts, and that housing affordability has declined to an unusually low level even though mortgage interest rates remain at nearly historic lows.

Mr. Greenspan's message on Monday was twofold: first, that the use of exotic new mortgages could be aggravating the run-up in prices and inducing some families to take on too much risk; second, that the finances of most households are still on solid ground.

» Continue reading "Most Homeowners Not Overly in Debt, Fed Chief Says"

George Clooney, Rande Gerber and Preeminent Real Estate Developers to Transform Las Vegas Skyline With Las Ramblas

Related Las Vegas and Centra Properties to Partner With Clooney and Gerber in Unprecedented Hotel-Condominium-Casino Complex Featuring City's First Open Air Promenade
First Phase of $3 Billion Project, Designed by Philippe Starck, Arquitectonica and Keith Hobbs, to be Complete in Early 2008

NEW YORK, George Clooney and Rande Gerber are joining together with the preeminent real estate developers, Related Las Vegas and Centra Properties, to create Las Ramblas -- a world-class hotel, condominium and casino complex that will be the largest residential project in Las Vegas and continue to transform the city into a first-class urban destination. Las Ramblas, a $3 billion project located on the burgeoning Harmon Avenue corridor situated just off The Strip, will encompass more than 25 acres and feature 11 towers with a luxury hotel, luxury residences (both condo and condo-hotel), bungalows, spa and health club, nightlife, dining, shopping and a proposed upscale casino. Evoking its name, Las Ramblas will also feature the city's first-ever, open air pedestrian promenade.

Las Ramblas is a collaboration among the world's great developers, architects, designers and entertainers. The project is being developed by a joint venture of Related Las Vegas and Centra Properties. Related Las Vegas is the Las Vegas development arm of the Related Group, the largest developer of condominium projects in the Unites States. In addition to transforming the Miami skyline through an array of developments, Related is responsible for such world-renowned, mixed-use urban developments as the Time Warner Center in New York and CityPlace in West Palm Beach. Related is also the developer and owner of two of the most successful hotels in New York -- the W Union Square and the Mandarin Oriental New York Hotel -- and is currently developing the W Hotel condo-hotel project in South Beach. Centra Properties is one of the most active developers in Las Vegas with such trendsetting projects as the 1.9 million square foot Town Square mixed-use project.

Phase one of Las Ramblas, a new world-class hotel, condominium and casino development, will include the first four of 11 towers, including a 300-room hotel with 370 additional condo-hotel units and a second adjacent tower of approximately 556 condo-hotel units (shown here), as well as two residential condominium buildings. The four towers will be designed by the renowned architecture and interior design firm, Arquitectonica. Construction of phase one begins in mid 2006, with expected completion in early 2008.

Construction on Las Ramblas commences in mid 2006. When completed, Las Ramblas will encompass more than 4,400 hotel, condo and condo-hotel units in 11 high-rise buildings comprising nearly 8 million square feet. It will include 300 hotel units, 2,764 condo units, 1,326 condo-hotel units and 19 bungalows. Phase one will be designed by the renowned architecture and interior design firm, Arquitectonica, and will include the first four towers, to be completed in early 2008. This includes the 300-room hotel with 370 additional condo-hotel units, a second adjacent tower of approximately 556 condo-hotel units, and two gateway residential condominium buildings at the entrance of the project, containing 285 and 344 units respectively.

» Continue reading "Las Ramblas Las Vegas"

Miami Beach September 2005 - Miami Beach has for some time and is still actively converting rental units and hotel rooms into condominiums. Years back, investors who flipped the units by converting them to condominiums purchased countless smaller South Beach apartment buildings. More recently, the North Beach area has been getting the same treatment.

Elderly South Beach residents (most without vehicles) were forced out as renters and replaced by younger residents who purchased the same units as condominiums. South Beach has since had to create neighborhood street restricted parking for these permanent residents. Many of which have two cars.

The City has had to react to these permanent changes by enacting various laws.

This past commission meeting Commission Bower put a discussion item on the agenda regarding low-income assisted condominium purchases. Some of these elderly reached out to the MBCDC (Miami Beach Community Development Corporation) and got Federal money to purchase their units on reduced payment mortgages. With these older buildings now needing repair, special assessments have been needed to fund these repairs. Once again, the lower income elderly are facing financial stress.

Once again, the City is being asked to enact some legislation.

With the South end coming alive with new clubs and old hotel renovations, South Beach once again became a popular place. New condominiums began to rise near these attractions. Condominiums on Ocean Drive selling for a mere $30,000 in 1985 were now offered for $200,000 less then 10 years later. People wanted to live where the "action was".

Yet some new residents desiring ocean access but not club action began protesting the late night music. They beat on the City Commissioners wanting noise controls.

Once again City laws needed to be created.

Back in the early 90's, Miami Beach needed more hotel room inventory and the Loews hotel was built to provide tourist/convention rooms. Next-door two derelict buildings were raised and the Lincoln south to 15th street complex became the convention visitors staying place. Interestingly enough they now are slated to be converted into condominiums.

One should ask who has better standing, the hotel strip invading condominium residences or the tourist hotels. These buyers want to be in the action produced by these attractions. One such condominium complex located at the north end of Ocean Drive (one of the most popular nightlife area of this City) came to the July commission meeting complaining of the Loews having an outside guest event at 4:30 pm IN THE AFTERNOON. "The boom boom of the base" was their problem.

Isn't it interesting that the north condominium, next door (an older conversion) did not complain but the new condominium (south) two blocks away that were the 'bitcher's'.

Once again, the City Commission has to revisit rules and laws on noise and special events.

This writer has to ask; "Is it time this City enacted condominium conversion legislation?" After all, hotels need to be profitable to exist. They need to provide more then just room space. They need entertainment for guest. They need to provide for wedding receptions, convention parties, and other such activities that may in fact take place after 6 pm.

People come to visit and life on Miami Beach because of the sun and warm air. Daytime rays are not comfortable to those in dress wear. So nighttime events are held OUTSIDE to enjoy the cooling ocean breeze and fresh air.

» Continue reading "Time to Regulate Miami Beach Condo Conversions ?"

by Robyn Friedman, Special to the Sun-Sentinel

A Chicago-based developer has unveiled plans for an ambitious project that will ultimately include five buildings on a 10-acre tract between the ocean and the Intracoastal Waterway in Hollywood.

MCZ/Centrum, a joint venture between MCZ Development Corp. and Centrum Properties, plans to build Sian Ocean Residences & Resort, a $400 million project that will include condominiums, condo-hotel units and a waterfront yacht club.

The first phase of the project will include the conversion of an existing apartment building to condominiums as well as the conversion of the existing Ambassador Hotel to condo-hotel units. The second phase will include the construction of a condominium building, a new condo-hotel and luxury villas.

"It's basically an infill project," said Michael Lerner, president of MCZ/Centrum, referring to development that occurs in older parts of a city or in a previously developed area. "There is a real demand for hotels there, and the condo-hotels on the marina are going to be a great addition for Hollywood."

The first phase of the project, which is about to begin, includes:

The renovation and conversion of 4001 S. Ocean Drive, an existing 16-story apartment building, into a condominium called Sian Ocean Residences. There will be 221 units ranging in size from 812 to 1,355 square feet and in price from the $300,000s to $1 million. The units will have features such as floor-to-ceiling glass doors, curved private balconies, ceramic tile flooring and high-speed Internet access. The building will have a porte-cochere entrance, fitness center, aerobics room, pool, business center, valet and concierge service.

The conversion of the existing Ambassador Hotel, at 4000 S. Ocean Drive, to a condo-hotel called Sian Yacht Club Residences & Resort. The 10-story existing building will be converted to 309 units ranging in size from 431 to 907 square feet. Pricing will range from the $200,000s to the $300,000s. These units will be fully furnished and will feature flat-screen televisions, porcelain tile, a tumbled stone shower, granite countertops, wood cabinetry and high-speed Internet access. The building will have a pool, meeting space, beach club, room service, restaurant and bar, boardroom, fitness center and concierge service.

The second phase of the project, which Lerner said will begin early next year, will include:

A new condominium called Sian Beach Club Residences, which will include about 30 luxury waterfront condominiums that will sell for $1.5 million and up.

A new condo-hotel called Sian Yacht Club Residences II & Resort, at which units will range in price from about $300,000 to $500,000.

Sian Waterside Villas, which will include approximately 30 luxury waterfront villas.

Pre-sales on the condo conversion in the first phase began last week, and Lerner expects closings to start taking place in January. The condo-hotel units in the Ambassador building will go on sale at the end of September, he said.

At least one local real estate agent questions whether there is enough demand in the area for all the units at Sian in view of the fact that there are ample condominium resales in the area that are competing in the same price range.

"There are recent condo conversions that have 40, 50, 60 units per building on the market," said Lloyd Feinberg, a sales associate with Coldwell Banker Residential Real Estate Inc. in Hollywood. "People are going to be chopping their prices just to liquidate their units."

Feinberg also said that there has been a "heavy saturation" of condominiums along the coast from Fort Lauderdale through Aventura to the Biscayne Corridor in Miami. "Hollywood is still somewhat of a sleepy little town that has been untouched by a lot of developers," he said. "It will be interesting to see what happens."

MCZ Development Corp. was founded in 1985 by Michael Lerner. The company has participated in the redevelopment and redesign of some of Chicago's most celebrated areas.

Centrum Properties is a 25-year-old firm specializing in residential, retail and commercial development. It is one of the largest developers of Walgreen's stores in the Midwest.

Locally the two companies have teamed up to create The Wave on Hollywood Beach, a conversion; Cit�a new condominium in Miami; and The Tides on Hollywood Beach, a conversion.

For more information on this project please call Paul Hansen at 786-586-4778.

Grant Street Townhomes in Hollywood ...These new townhomes are nestled into a unique enclave of only 4 townhomes, set amid Hollywood's vibrant atmosphere and natural beauty.

These 3 bedroom, 2 1/2 bath townhomes include a 1-car garage, 2 car driveway, backyard patio, living, dining, and breakfast areas, totaling 1,918 square feet (under roof area). The second level includes 3 bedrooms and a study loft. The spacious master suite includes a balcony, his & her sinks, roman marble Jacuzzi, and large walk-in closet.

The site is located in a premium location, only 1 mile from the Young Circle Park and just 1.5 miles from the Hollywood Circle.

Prices starting at $429,000

For more information on Grant Street Townhomes

The preconstruction process is an innovative real estate investment opportunity in which you buy tomorrow�s property at today�s price. Preconstruction investing is a boon for the investor or buyer as well as the developer or builder. The biggest advantage of preconstruction process is that you can reserve your buy at discounted prices without investing a fortune. You simply have to make a small investment that is as low as 10% of the total cost to reserve a unit and pay the balance on achievement of different milestones.
For the buyer, preconstruction process provides an opportunity to seal a property deal with little margin money and achieve sizable discounts over the tentative price of the finished condos. For the developer it is an opportunity to presale the entire property even without laying a single brick and to procure a construction lending with relative ease.
In the preconstruction process, property developers place the building plans of a proposed real estate venture for pre-selling. Only thing made available to the buyer are architectural rendering and floor plans of the condominium, town house, or single-family residence. The good news is that preconstruction prices are normally at an attractive discount of the proposed sale price of complete units.
In theory, the buyer gets the discount because they display the grit and tenacity to invest on mere paper and �air�. However, in reality, they are getting discounts because they are a crucial piece of the puzzle for the developer because pre-selling of a particular percentage of the total units is a need for getting a prospective lender to fund the construction process.
If you are interested in investing in preconstruction property, you can check out the list of preconstruction offers available in your locality in the newspapers, on the Internet or with your real estate consultant; that is if you have those types of projects in your locale. When you have the list, you can shortlist the offers that are suitable according to your budget and needs. After that you must run a thorough check on the property and the developer on many issues. Certain key reasons are, the going and expected cost of the similar units in that locality; demand supply factors; whether the units are assignable and uniqueness of the property. You must also check for the future or proposed development plans in the vicinity to protect your view. This aspect is important because you might choose to buy an apartment in a preconstruction process at a premium due to the prefect view of lake or waterfront. However, after some time you may find out that another developer is building a project, which may blind your view.
After you have satisfied yourself with the suitability and pricing of the condominium, you can proceed for the reservation. Most preconstruction properties have a nominal reservation amount, which is normally 5-10% of the total cost and can go as low as $1,000. The reservation process has a simple �Intent to Purchase Agreement� in which you hold the right to first refusal. In this phase, you are safe because your money is in escrow account. For more information on Miami pre construction please visit HansenHomesAventura.com

Real estate markets are off and running again after a slight slowdown earlier this summer.

The red-hot U.S. housing market, after a typical summer slowdown, has taken off again and Hurricane Katrina contributed to up-ticks in several localities.

According to the National Association of Realtors, with inventory of homes available for sale across the country so tight anyway, rebuilding the Gulf Coast will place additional pressure on all home prices.

"New home prices will be immediately impacted because of increased construction costs," says NAR economist Lawrence Yun, "and that will filter down to existing home prices as well." That's because as new house prices rise, more homebuyers will consider existing homes, increasing the demand (and prices) for them.

Home sales have already spiked, as has rental demand, in regions surrounding the disaster zone in the Gulf Coast, according to NAR.

Michael Carliner, economist with the National Association of Home Builders, points to increased housing demand in Baton Rouge and Houston, which pre-Katrina, had a large inventory of vacant rental housing. Much of that has now been snapped up, he said.

In Baton Rouge, evacuees have bid up property values by up to 30 percent in just the last week or two. (See that story here.)

But it isn't just a Katrina effect. With home prices having gained so much in the past few years, skeptics have been waiting for what they consider to be an inevitable slowdown, and were quick to point to sluggish activity over the summer.

Those skeptics are still worried, but for the time being, there already are signs that the rally is picking up where it left off.

Florida remains strong
Katrina has had little effect on neighboring Florida markets, except for a trickle of hurricane evacuees in the panhandle area. Some businesses have also temporarily relocated to Tampa and other Florida towns, putting a little more pressure on markets.

Overall though, Sunshine State markets have continued strong and high prices are transforming landscapes. As single-family home costs have exceeded affordability for many Floridians, condo sales have boomed.

That has, in turn, affected the rental market -- investors are snapping up apartment buildings for condo conversion and sending their prices climbing.

Said Matthew Martinez, who owns rental properties in Boston and Florida: "I've looked at 22 apartment buildings in Miami in the past two weeks and bought none. The economics just don't make sense anymore."

Just north of the hot Miami Real Estate market, the situation is much the same. Elena Felipa, vice president of the Corcoron Group in West Palm, said "Lots of apartments are being converted to condos," she says. "There are few rentals around anymore."

» Continue reading "Slowdown? Real estate still going strong"

There is a new trend in South Florida, due to the overwhelming amount of dog-lovers investing in condominiums. Porto Bellagio Condominiums, in Sunny Isles, and Aventi Townhomes in Aventura, instead of saying "no pets," have established an interview process for dogs, pseudo Trump, to see how they adapt and interact with their surroundings before welcoming them into the building. The Trump-like dog interviews are performed with the assistance of a certified executive recruiter/head hunter.

The Pet Head Hunter is one of the ways that these dog friendly communities are sizing up dogs to see if they are a good fit for the development. As a dog-friendly community, these two developments understand that size of the dog doesn't matter, it is the personality, demeanor, and how they interact with other dogs and people.

"The Pet Head Hunter, schedules these pooches for an interview that even Trump would appreciate," says Mike Pappas, President of The Keyes Company. "Dogs have to fill out an application, as well as go through a one-on-one interview with an executive recruiter, and interact with another well-behaved dog. It used to be that only dogs under 20lbs could live in a condo, the interview process enables owners of large dogs to also live in the development."

Porto Bellagio is equipped with conveniently located "doggie potties" within the walk ways and grass areas. The doggie potties feature trashcans, pooper scoopers and plastic bags to make cleaning up easy. Aventi Aventura has a walkway on the bay for a perfect walk and dog retreat and a private courtyard for relaxing.

Average Dog Interview Process (DIP) consists of a 15 to 20 minute interview at the development sales office with an executive recruiter and a member of the management team. The interviewer will have the owner of the pet give the dog a Trump-like command and observe if it is followed, they will observe how the dog interacts and plays with an unfamiliar person, a seasoned recruit. Then the dog will be tested for any sort of aggression, traits that would help you with Trump, but not at the development. There are a host of other tests depending on background and experience of the pet.

DEVELOPMENT: W hotel takes Sin City spin

$1.7 billion luxury condo-hotel aims for hip clientele

By HUBBLE SMITH
REVIEW-JOURNAL

Starwood Hotels and Resorts plan to make its W hotel in Las Vegas a flagship property for the upscale brand's "global footprint," W Hotels Worldwide's president said Tuesday while giving details about the $1.7 billion project.

The hotel at Harmon Avenue and Koval Lane will have a mix of 3,000 hotel and residential units, more than 10 restaurants and nightclubs, a 75,000-square-foot casino, 300,000 square feet of meeting space and a spa and gym, W's Ross Klein said. It's scheduled to open in 2008.

Klein said Las Vegas has been at the top of W Hotels' development strategy for years, ranking No. 1 or No. 2 on the request list of W guests along with South Beach in Miami, where a W Hotel is already under construction.
"It's also an opportunity for us to redefine and reinvent what an urban oasis is," he said. "The W in New York came into an urban environment with a different point of view. When you come in off the street in New York, it's a retreat, an escape. That's going to be the same design point of view we put into the W in Las Vegas."

Adam Frank and his partners at Edge Resorts started talking with Starwood about developing a W hotel in Las Vegas at the site of Bourbon Street casino on east Flamingo Road. Even after acquiring an adjacent apartment complex for a total of 8 acres, it wasn't enough land.

Edge Resorts sold the Bourbon Street property to Harrah's Entertainment last month and bought 21 acres at Harmon and Koval, including the existing Ice nightclub and two separate parcels from Fort Worth, Texas-based home builder D.R. Horton, for $108 million.

Edge Resorts entered a joint venture with Starwood Hotels and Resorts and will be a 75 percent owner of the W hotel. Starwood owns the remaining 25 percent and will manage the hotel.

"They wanted a bigger property and they really wanted to be on Harmon," Frank said. "Twenty-one acres really gives us a lot more flexibility to do what we want to accomplish. We want to build a destination resort, but at the same time, we want to have an intimate feel to it, that signature W feel with great night life and a blend of restaurants."

Frank said the project combines the hottest, most sought-after hotel brand in the world with one of the most vibrant hospitality markets in the United States.

"We really think that location is the future of Las Vegas," he said. "There's so much happening right around us."

With some $20 billion in planned development, from the Hard Rock Hotel expansion to MGM Mirage's Project CityCenter to the Palms' new hotel and condo towers, the Harmon corridor is poised to become a hip, happening location, Klein said.

"I think it's going to be a destination with a very specific offering, sort of a pop culture, and I think we're going to be sort of an anchor," he said.

W Hotel Las Vegas will offer guests "extraordinary experiences" at every turn through the brand's lifestyle elements, including indulgences and experiential surprises that will be unheard of even for Las Vegas, Klein said.

Klein said he expects the new resort to compete with the Hard Rock Hotel, Mandalay Bay, the Palms, Wynn Las Vegas and Four Seasons.

Deutsche Bank analyst Marc Falcone said it was important for W to finally land in Las Vegas.

"I think W needs exposure in Vegas given what the brand stands for," he said. "It's going to be a strong fit for Las Vegas. This is a very powerful location."

Condo-hotel and residential units will go on sale in the fourth quarter, priced from $550,000, offering a combination of poolside cabanas, studios and one- and two-bedroom condominiums, all attached to the W hotel.

Klein said the project is in the final stages of architectural plans and design reviews.

The first W hotel opened in New York in December 1998. There are now five hotels in New York and 20 more around the United States and worldwide with another 20 under development, Klein said.

The Associated Press contributed to this report

For More Information on W Condo Hotel Las Vegas

Robert Katz of Palm Beach is taking an unusual real-estate gamble: He's betting his 10-year-old, tennis-playing son will want to attend college in nearby Boca Raton, Fla., home of tennis champ Andy Roddick.

Katz has snapped up two properties, not yet built, for more than $375,000 apiece. Both are in easy driving distance of the town's two big schools, Lynn and Florida Atlantic universities.

"He would have a really nice place to live, in a safe building, and he'd be able to choose his roommate," Katz said.

More parents are viewing their children's college experience as a way to get on the property ladder. As the real-estate market has taken off, so have parents' interest in off-campus housing. And while most wait to buy until the child's sophomore year, some parents, like Katz, figure the earlier, the better.

Historically low rates and flexible financing have driven the trend in recent years. The National Association of Realtors found last year that 6 percent of investment buyers purchased a second home for use by a child attending school, a figure that equates to about 169,000 properties. The association hadn't asked the question before, so a year-to-year comparison isn't available.

"We just started to hear about it," said Walter Molony, a spokesman for the association.

Many parents would rather buy a condominium or house rather than spend the money on campus housing, which has steadily risen.

For 2004-2005, room and board amounted to $7,434 at four-year private colleges and $6,222 at four-year public colleges, according to the College Board.

The real impetus, though, is diversification of the portfolio, financial planners say. Amid bubble concerns, the college market is perceived as more secure because of the steady flow of incoming students.

Parents can write off mortgage interest and property taxes, and either sell the place at graduation or keep it as a rental property.

"I'm seeing more people intrigued about doing it - more than ever," said David Gatheridge, general manager of the Wealth Enhancement Group's mortgage division in Minneapolis. "It has a lot to do with the fact that their primary residences have increased so much in value."

Parents of college-bound kids are jumping on the opportunity early, often when their child has just sent in applications, Getheridge said.

In Austin, home of the University of Texas, the heaviest buying season for parents is between April and August, said Mark Orr, manager of Texas lender Colonial National.

More than 48,000 students attend that university. "There's always a demand for housing, and a shortage of rental properties," he said. "Parents find it easier to go in and buy a condominium they can expect to appreciate."

A popular purchase for parents is a two-bedroom, two-bath condo, currently selling for about $185,000. Austin's fast-growing population makes it a hot real-estate market, Orr added.

Not as attractive is the smaller city of College Station, home of Texas A&M, where a two-bedroom, two-bath condo sells for $40,000, he said. Parents would have a hard time renting if they need to hold on to the condo longer than expected, he said.

Nicole Persley of Real Estate of Florida helped Katz find the properties for his 10-year-old son and often works with parents who want to buy condos for the Boca Raton schools and the University of Miami.

"The smartest move is if the parents have two or more college-bound kids at the same college," she said. "It's a no-brainer to buy versus rent or live in a dorm."

There are factors to consider, however. "It's not a get-rich-quick scheme," said Nancy Flint-Budde, a financial planner in Salem, N.Y.

For one, parents should factor in a long holding time in the event of a market dip, she said. Taxes and mortgage interest, while a write-off, may cause a cash-flow crunch.

While renting is an option, some parents might be ill-prepared to be landlords.

Parents might need to hire an agent to manage the property, especially if the condo or house is out of state. Parents also should consult a tax adviser about the differences between treating the property as a second home versus an investment property, she says.

And some question whether buying an apartment is the wisest parental choice. "Imagine getting as a high school graduation gift this stunning apartment in the best part of town," said Rebecca Kiki Weingarten, an education consultant and life coach in New York. "It really skews the whole sense of what it is to be on your own."

Call Paul Hansen 786-586-4778 or vistit HansenHomesAventura.com for more information.

LAS VEGAS � Starwood Hotels & Resorts Worldwide Inc. intends to expand dramatically in Las Vegas, bringing its hip and urban W brand to one of the most competitive and coveted markets in the leisure industry.
Starwood is joining Edge Resorts, a group of private investors, in a $1.7 billion project that will involve a mix of approximately 3,000 hotel and residential units and a 75,000-square-foot casino, along with 300,000 square feet of meeting space and shops. It's slated to open in 2008.

Edge Resorts will control 75percent of the project. Starwood, W's parent company, will own the remainder and manage the W Las Vegas hotel.

The project will sit on 21 acres located just east of the Las Vegas Strip, near the popular Hard Rock hotel-casino.

"The other properties will orbit around us," said Ross Klein, senior vice president and chief marketing officer for W Hotels Worldwide.

Klein said he has been trying to bring one of the sleek and modern hotels to Las Vegas since the launching of the first W in late 1998. Klein said W customers have been clamoring for one in Las Vegas, but he could never find the perfect location, partner, timing and scale.

With Las Vegas gambling companies still churning out hefty profits, Klein said the market is "still red hot and white hot for innovation. W Las Vegas will definitely be a laboratory for a lot of what we are doing."

Klein said he expects the new resort to compete with Hard Rock, Mandalay Bay, the Palms, Wynn Las Vegas and Four Seasons.

Deutsche Bank analyst Marc Falcone said it is important for W to finally land in Las Vegas.

"I think W needs exposure in Vegas given what the brand stands for," he said.

Edge Resorts President Adam Frank said he isn't concerned about the glut of Condo Hotel projects slated to be built in Las Vegas.

"The W brand is obviously one of the strongest names in the hospitality business," he said. "The Vegas buyer of condos has become more savvy."

New York-based Starwood, one of the biggest hotel operators in the world, is also part of a group of investors that bought the Aladdin megaresort on the Strip. It also owns the Westin Casuarina in Las Vegas.

Starwood shares rose 50 cents to close at $60.35 in trading on the New York Stock Exchange

MIAMI � Fifty stories below the penthouse terrace of Jade Residences, a new luxury condominium high-rise, the turquoise waters of Biscayne Bay and the Atlantic Ocean beyond stretch endlessly.

Miami's 70-story Four Seasons tower includes condos.
Four Seasons

This mesmerizing view from the three-story, four-bedroom condo fetched $7 million in the hottest real estate market Miami has ever seen, and one of the hottest in the USA.

Florida's developers and real estate brokers are flying high amid an unprecedented condo-building and -buying wave they hope won't end anytime soon. The frenzied spending is coming to a large extent from outside Florida � well-to-do baby boomers from the North nearing retirement, and foreigners whose money for real estate has gained potency from a weak dollar.

Development is also setting records in other Florida coastal cities such as Tampa and West Palm Beach, but the boom has been most dramatic in Miami and its nearby beach communities.

Miami-area home values increased 20% in 2004, vs. a national gain of about 12%, the federal government says. But that measure fails to register the dizzying price escalation for new condos on or near the water. Developers of new projects are asking about $500,000 for a one-bedroom on the beach with an ocean view.

Today, an estimated 50 major condo projects are proposed or under construction within 50 city blocks in Miami on or near Biscayne Bay. There are so many gaping holes in the ground � where old buildings have been razed and new ones are planned � that downtown looks as if it has been bombed. A remarkable 69,000 condo units are currently in the permit pipeline or are newly built and for sale citywide. By comparison, Las Vegas � perennially among the USA's hottest housing markets � issued permits for 40,000 units of all types of housing last year.

The explosion in South Florida real estate comes despite four major hurricanes that roared across Florida last summer, causing $22 billion in damage and weeks of panic statewide. The Miami area was spared, but for a time, it seemed the phenomenon of four hurricanes could cause the entire Florida coastline to lose a bit of luster. That hasn't happened.

"South Florida is going through the largest urban redevelopment in its history," says Michael Cannon of appraisal firm Integra Realty Resources.

Cannon and other experts here are increasingly worried that paradise might be getting overbuilt. They fear investor speculation is driving too much of the condo demand � that some builders, developers and lenders might be heading for a crash, as has happened here before.

He and other experts suspect some projects will never get the construction loans they need to get off the ground because so many units have been pre-sold to speculators with small down payments, and banks know the speculators plan to resell at a profit, not live there. "Do I think all these projects will be built?" says real estate expert Lewis Goodkin of Goodkin Consulting. "Absolutely not."

Weak dollar draws Europeans

Powerful economic and demographic forces are driving the boom. Developers see an army of aging baby boomers looking for a warm place to vacation or retire. Low interest rates have made big mortgages more affordable. In the past five years, Miami real estate has been a far a better investment than the stock market.

The weak dollar makes Florida real estate look like a bargain abroad. To Europeans with euros to spend, for example, Florida property can seem like a deal because of the added buying power they get from a favorable currency exchange rate. Unlike the past, today's Florida developers aren't targeting just retirees or snowbirds from the Northeast and Latin America. Luxury buildings are targeting the wealthy worldwide.

For years, Miami suffered from negative perceptions fed by popular culture and reality. TV's Miami Vice glorified the fight against the violent cocaine trade. The series CSI: Miami still portrays this as an unusually murderous town. In the 1990s, police corruption, violent attacks on tourists and prosecutions of top politicians on bribery and voting-fraud charges shaped a banana republic image.

Today, Miami's business and government leaders are working to craft a world-class city. A performing arts center is going up downtown, and development is planned all around it. Blocks away, the American Airlines Arena houses Miami Heat basketball games and concerts by top stars. A few miles to the east lie the hot restaurants and nightclubs of South Beach. So fast is Miami's landscape changing that Mayor Manuel Diaz last weekend unveiled a master plan, "Miami 21," designed in part to bring order to frenetic development.

Prices for new condos have leaped. As of last year, the average price for a condo in Miami-Dade County hovered close to $300,000, a third higher than in 2000, according to Integra. But in downtown Miami's more desirable neighborhoods, one-bedrooms in new projects start at about $350,000 in the earliest stages of selling. In Miami Beach and other communities, one-bedroom units in new oceanfront projects start at close to $500,000 and run into the millions.

With prices at those levels, developers must inspire an irresistible urge to buy. To that end, some new projects are named for precious stones and metals: Onyx, Emerald, Platinum. Others evoke colors of the sea � Blue, Acqualina � and still others, rapturous states of mind -Apogee, Nirvana.

"They're not selling condos anymore," Cannon says. "They're selling sex."

"You sell a dream, " says Edgardo Defortuna, CEO of Fortune International, a Miami developer.

Developers, he says, must sell condos today before the first dirt is turned because construction lenders require sales-contract commitments upfront. Fortune's Jade project sold out a year before the building was completed last fall.

Now, Fortune is marketing a proposed oceanfront project called Jade Beach, where the penthouse is advertised at $11 million. Meanwhile, land prices in downtown Miami's handsome Brickell Avenue neighborhood, where Jade was built, have continued to soar. In 2001, Defortuna paid $19 million for Jade's 2.5 acre site. Today, an adjacent empty lot the same size is advertised at $100 million.

Developers are amazed at the diversity of buyers and shoppers. Ninety percent of Jade's buyers are foreign nationals, says Ana Cristina Defortuna, Edgardo's wife and the company's vice president for sales.

"We have people from every Latin American country," she says. "We have royalty in the building, singers, actors."

Mexicans are the top Latin buyers now, she says. Mexican pop music star Luis Miguel owns one of Jade's penthouses. Colombian race car driver Juan Pablo Montoya owns another one.

"Russians are very strong right now," she says. "They are the best: They don't negotiate price."

Other projects target U.S. buyers. At Trump Grande, an oceanfront high-rise development in nearby Sunny Isles Beach, buyers tend to be from the Northeast, where the Trump name is well known. Five condo towers are proposed on a total of 19 oceanfront acres where sleepy motels once stood. Prices range from $700,000 to a stunning $25 million for an 18,000-square-foot penthouse.

Developer Joyce Bronson, whose company Related Group is backing Trump Grande, says they have seen no signs the market is cooling off.

"There is a large buying population out there," she says. "When you compare the value of real estate here to other world-class cities, our numbers look pretty good � and we have sunshine."

Speculators eyed

Community leaders hail the burst of growth, the new property tax revenue and the revitalization of neighborhoods. But many real estate experts are warning that rampant speculation could jeopardize the vibrant market.

Consultant Goodkin estimates up to 70% of recent condo buyers are purchasing for speculation.

"People are betting rather than buying," he says.

Fueling the problem is "an absence of gatekeepers," Goodkin says. "There's a lot of liberal financing out there." Experts also note that a new crop of aggressive but inexperienced developers has been drawn to the market by the smell of quick profit.

"All the banks are concerned about the level of speculation," says Raul Valdes-Fauli, the senior lender at Union Bank in Miami. "In a market like this, banks really need to go back to the fundamentals, and do deals with people they know." Union is now "being more selective" about financing new condo projects.

He says many construction lenders are now requiring developers put "non-assignment" clauses in sales contracts forbidding buyers from flipping their units before they close. Others are requiring 30% down payments or limiting the number of units any one buyer can get to one or two.

If a building sells too many units to speculators who don't close, he says, "The first people who get burned are the buyers who just closed on their units." The value of their investment plummets.

Despite the investment risks, many buyers can't resist the hypnotic water views � and the possibility prices will keep going up. Drawn to the tropics, airline CEO Jonathan Ornstein of Phoenix-based Mesa Air Group shopped a long time for an oceanfront condo in Miami Beach.

Miami Beach is "a hip place," he says. "The condos are really on the beach. You walk out the door, and you're on the sand."

Ornstein just put 10% down on a small, furnished condo-hotel room in Fontainebleau III, a project adjacent to the oceanfront Fontainebleau Hilton Resort in Miami Beach. The building won't be completed for at least two years. At $580,000, the unit was $1,000 a square foot.

He knows he might have overpaid. "This could be a bubble," he says. If it is, he says, buying at the low end of the market gives him some protection. "The less you spend, the less you could lose."