Rental condos will be harder to find in South Florida

FORT LAUDERDALE, Fla. – Feb. 16, 2015 – If you want to rent a condo or townhome, your options in South Florida are disappearing.

Many developers and investors who rented out units after the housing collapse are putting them back on the market now that home prices are rising.

That means you'll have a harder time finding one to rent, but you'll have more places to look at to buy.

Among those making the switch so far are Royal Poinciana Townhomes at Boca Raton, The Whitney in West Palm Beach and Villas de Venezia in Sunrise. You'll see even more in 2015 and beyond, analysts say.

"Renting is like always wasting your money – it goes right in the trash," said Selmaria Rezende, a 45-year-old medical aesthetician who's trading in her apartment lease for a mortgage on a four-bedroom townhome at Royal Poinciana in April. "When you buy, you're paying a mortgage and it's something for you."

The 90-unit Royal Poinciana development, with Spanish Mediterranean architecture, was built north of Yamato Road off Dixie Highway in 2007, just as the housing downturn was deepening.

The developers sold about half of the two-, three- and four-bedroom units before losing the property in foreclosure, public records show.

In May 2013, Sabal Financial Group, an investment firm in Newport Beach, Calif., bought the unsold units for $11.4 million, records show. With the housing market still in tatters, Sabal rented the townhomes before deciding last year that prices had recovered enough to launch sales.

Balistreri Realty and Brenner Real Estate Group took the listing last summer and have 21 left to sell. Prices range from about $339,000 to $451,000. That's a lot for townhomes without water views, real estate observers say. But consider what you'll pay compared with the new buildings going up.

Another wave of condo construction is adding thousands of units to the South Florida skyline, many with $1 million-plus price tags. But they won't open until next year or later, so they won't help if you're looking now.

Financing is more available now, too. First-time buyers can get Florida Housing Administration (FHA) loans that require as little as 3.5 percent down. Restrictions on condo loans put in place by Fannie Mae during the downturn are starting to lift – making it easier for people to qualify for mortgages, real estate observers say.

"FHA has helped a tremendous number of my buyers," said Beverly Rothstein, an agent in Broward and Palm Beach counties. "Lenders have come to the realization that they have to be slightly less strict so that people can purchase homes and they can make loans."

Over the past several years, Miami-based Mattoni Holdings bought about 150 condos and townhomes across Miami-Dade and Broward counties. Units at Sailboat Pointe in Oakland Park and Belmont in North Lauderdale were among its acquisitions.

The investment firm spruced up the units with fresh paint and new carpeting, found willing renters and enjoyed a strong cash flow before finally deciding the market had rebounded enough to sell.

"Renting for us was actually very easy, but it was never the long-term goal," said Ricardo Caporal, owner of Mattoni. "Selling is almost like a cleanup – it's closure."

Back at Royal Poinciana, Andrea Brenner, marketing director at Brenner Real Estate, said she's encouraged by a flurry of interest in recent weeks. Buyers are snapping up units that serve as the models and sales office – forcing the real estate firms to move to another townhome each time. They packed up and hired movers for the fifth time on Friday.

"We keep laughing and moving," Brenner said. "The hassle is worth it."

Brenner said she hopes to be sold out of the gated community by the summer or fall. That's welcome news to existing residents such as Gabriel Paredes, who said he has lived there since 2009.

Paredes, 29, is convinced that Royal Poinciana will be better off with more owner-occupants in place, taking their morning jogs and swimming in the community pool.

"They have pride of ownership," he said. "They care about the well-being of the neighborhood long-term."

Source: Sun Sentinel (Fort Lauderdale, Fla.), Paul Owers. Distributed by Tribune Content Agency, LLC.