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The forecast for home sales has trended up as the year progressed, fueled lately by added demand resulting from the impact of recent hurricanes, according to the National Association of Realtors�.

David Lereah, NAR�s chief economist, said that at the beginning of the year it was thought that 2005 would be the second best total for both existing- and new-home sales, but by June it was apparent that another record was in the works. �Post-Katrina, our sales projections for this year have moved even higher,� Lereah said. �Short-term momentum is very strong, and our Pending Home Sales Index just set a record. In addition to the housing needs of hurricane victims, we may be seeing some �fence jumping� from home buyers who are getting into the market before interests rates move higher.�

Existing-home sales are forecast to rise 4.2 percent to 7.07 million in 2005, while new-home sales are expected to increase 7.1 percent to 1.29 million. Total housing starts � single-family and multifamily � should be up 4.5 percent to 2.04 million units this year, the best showing since 1973, and single-family starts are seen at a record of 1.70 million.

�Inflationary pressures � driven by higher energy costs � have become a concern, so we anticipate two more hikes in the fed funds rate by the end of the year. In addition, long-term interest rates also are rising at a faster clip,� Lereah said. The 30-year fixed-rate mortgage is projected to reach 6.2 percent in the fourth quarter, and trend up to 6.7 percent by the end of next year.

The national median existing-home price for all housing types is forecast to increase 12.5 percent in 2005 to $208,400, while the median new-home price should rise 3.9 percent to $229,700.

NAR President Al Mansell of Salt Lake City said some easing in home sales is expected in 2006. �The rise in mortgage interest rates is likely to have a slight braking action on the housing market, and the upside of that is it would help to bring the market closer to balance between home buyers and sellers,� he said. �As a result, there should be a cooling in the rate of price growth � on balance, the overall market should continue to favor sellers with price appreciation remaining above the high end of historic norms. The investment fundamentals for housing remain solid.�

In 2006, NAR expects the median existing-home price to grow by 5.2 percent and the median new-home price to rise 7.1 percent. Historic home-price gains are 1.5 percentage points above the rate of inflation, which is seen at 2.6 percent next year.

�Although energy prices are the chief culprit in current inflation concerns, we project oil prices to settle early next year � that would cause inflation to quickly dissipate,� Lereah said. The Consumer Price Index is forecast to rise 3.5 percent for all of 2005 before easing early next year.

Inflation-adjusted disposable personal income is expected to grow by 1.4 percent for 2005. The U.S. gross domestic product (GDP) is seen at 3.5 percent for all of 2005, with GDP picking up early next year as hurricane rebuilding accelerates. The unemployment rate is projected to average 5.2 percent for the next three quarters, then decline to 5.0 percent in the second half of next year.

SUNNY ISLES BEACH, FL-Two Chicago-based companies, the Feurer Cos. and Jos. Cacciatore & Co., have jointly acquired the 16-story East building of the three-building Ocean View Apartments complex at 19370 Collins Ave. for in excess of $100 million, or just over $251,256 a unit. Plans call for conversion of the 398-unit building into for-sale condos at selling prices beginning in the high $250,000s. The seller was Miami-based Crescent Heights, which has already converted the other two buildings in the complex to condos.

Cacciatore is the financial partner in the project, and Feurer will run day-to-day operations. Christopher Feurer tells GlobeSt.com this is the first time he and Cacciatore have partnered together, �although we�ve known each other for about 10 years. The property represented an excellent acquisition in today�s fast-growing real estate market, and we capitalized on the opportunity to own a building in a prime location.� He says the partnership is �actively looking� at additional opportunities in Florida.

The building, which faces the ocean, will be renamed Ocean Reserve Sunny Isles Beach. �Because of the price point,� Phil Cacciatore, a principal, says, �this building offers real versatility to buyers, facilitating both ease of ownership as well as tremendous investment potential.�

It was constructed in 1973. In 2001 it was renovated to include new glass balconies, a new roof, and all new electric, air conditioning and mechanical systems. The new owner is upgrading the lobby, amenity areas, vestibules on each floor and elevator cabs. Existing tenants will be notified of the conversion on Oct. 20.

There are five different floor plans, measuring from 1,000 sf to 2,500 sf, and ranging from one-bedroom, one-bath to three-bedroom, three-bath layouts. The JV has hired EHK Interiors to create model rooms of five different layouts, which will be sold fully furnished. There are eight commercial spaces on the ground floor, leased to tenants, including a dry cleaner, beauty salon and convenience store that serve the building. The amenities, including a pool, fitness center and business center.

St Tropez is set to be the latest pre construction condo project in Sunny Isles.
Sunny Isles Beach will get a touch of Mediterranean pizzazz when St Tropez goes up along one of the last undeveloped frontiers in the resort city. The St Tropez will offer pricing that will be a bargain compared to the ocean front projects of Sunny Isles. Veteran developer J. Milton and Associates is planning multiple buildings on the south side of Sunny Isles Boulevard/ NE 163rd St. They own 1,200 feet on the water and envision a Las Olas type urban center with mixed-use retail at street level and residential above. For more information on how to be one of the first to purchase a unit at the St Tropez please call Paul Hansen 786-586-4778 or click here to get more information.

Architect Kobi Karp has designed the St Tropez with three-bedroom units targeted at buyers of primary homes. The developer plans to build three towers simultaneously, with ground breaking in January/February and construction expected to start in mid-summer 2006. They also announced that they will donate land for a public park, dockage for a water taxi and facilities for the police marine patrol�s equipment. Altogether the plan calls for up to seven buildings, one of which will be Class A offices.

Another upscale Asian hotel is coming to Miami Real Estate, entering the US market through a venture on Watson Island.
A 147-room Shangri-La Hotel is to form part of Island Gardens, a $480 million Flagstone Property Group project that also is to feature a business hotel, Westin Miami.
This week, Shangri-La Hotels and Resorts announced plans to open in Chicago in 2009, a year after projected completion of the Miami property - its first venture outside Asia Pacific and the Middle East.
The group is based in Hong Kong, home to the Mandarin Oriental Hotel Group, which chose an island location on Brickell Key for its Miami hotel that opened in 2000.
The groups are targeting similar markets.
Mandarin Oriental will open in Chicago in 2008, a year before the Shangri-La.
Swire Properties clinched the deal to build the Mandarin Oriental in Miami on land it owns on Brickell Key. A senior Swire executive said that move, plus the presence of a major Asia-oriented bank, made the city more attractive to companies from the Far East.
"I think there will be greater interest on the part of Asian businesses," said Megan Kelly, vice president of Swire Properties. "The Mandarin Oriental and HSBC have huge visibility and act as beacons to other Far East interests. By persuading a hotel of the caliber of the Mandarin Oriental to come to Miami, Swire has validated this market for Asian businesses."
A hotel representative said the property blazed a trail for high-end brands.
"Mandarin Oriental was the first luxury hotel group to discover Miami," said Jorge Gonzalez, the hotel's general manager. "We saw the city as a high-growth market and as an international gateway.
"It's not that Miami has become a destination for Asian companies," said Mr. Gonzalez. "These few luxury Asian companies have now realized that Miami is a destination that can accommodate other luxury brands. After our five successful years of doing business in Miami, other companies are now seeing its great growth potential."
Another chain with a Hong Kong base has two condo-hotel offerings in the works in Miami-Dade County.
Regent International Hotels, founded in the former British territory in 1970, is to open Regent South Beach this fall. Regent Bal Harbour, a WCI Communities project, is to follow next year.
Even where there isn't an Asian link, developers are still looking to the Far East for inspiration.
Two weeks ago, the developers of a 21-story, 134-unit condominium project in Miami Beach unveiled blueprints for the project's interiors at an event at the Mandarin Oriental.
New York-based PMG Collins - a subsidiary of Property Markets Group - is using Hirsch Bedner Associates, the designer that worked on the hotel, for a development called Mei, meaning "beauty" in Chinese. The developer toyed with the name Tao but rejected it after having learned it is being used in the north of the state.
The 5875 Collins Ave. property is to feature a library, lobby and tearoom. Mei is slated for completion in spring 2007.

The Parc Central condo conversion project is getting ready to start sales this weekend. The demand for affordable housing is high so this project should have a quick sell out. The Parc Central has a prime location, just steps away from the Aventura Mall and the beaches. For more information on how to purchase a unit at the Parc Central, please call Paul Hansen at 786-586-4778.

One after another, officials presiding at September budget hearings in South Florida communities acknowledged the fiscal blessings of the real-estate boom. For two years, soaring property values have pumped millions more dollars into tax coffers than originally predicted, allowing most local governments to reduce millage rates ever so slightly while increasing spending on services.

The windfall has generated unusually harmonious budget hearings. Yet the prevailing good mood on many daises hasn't disguised a certain foreboding best personified by Miami-Dade Commission Vice Chairman Dennis Moss' observation, ``We are riding a wave right now. I just have a real concern that in the future things aren't going to be as good as they are today.''

New development's impact

Mr. Moss is right. The housing boom may already be flattening, meaning those big tax surpluses eventually will fade, too. And the boon to local-government coffers can't be squirreled away for harder times because the cost of government services keeps climbing as the population keeps growing. Miami, for example, finally is considering hiking its impact fees for new development after realizing that all the new condominiums in and around downtown have created higher demand for services -- but not enough additional money to pay for them.

Another example: During the fiscal year that started Saturday, Miami-Dade expects to take in $192.4 million more in property taxes than it collected this year. Yet 90 percent of the new revenue is dedicated not to new services but to maintain existing services in the $6.8 billion 2006 budget. And this is not a Cadillac budget. County Manager George Burgess has cut about 800 budgeted positions over two years.

Two things plague Mr. Burgess and other administrators of the region's largest local governments: Past budget belt-tightening left millions of dollars in unfunded needs; and future budgets must devote increasing amounts to employee pensions and benefits, such as constantly rising medical-insurance rates. The future is already here in Miami, where the bulk of the 18-percent tax surplus for fiscal year 2006 will be paid out in pensions, in part because past administrations failed to put aside adequate funds.

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