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October 9, 2007 (LPAC)-- Mentions of the real estate crisis engulfing the country, and people will conjure up images of urban blight and inner city decay. But some of the worst cases of unsaleable real estate, and the highest rates of foreclosures per square mile, are sitting on Miami's high-priced beach-front property, says an article in Monday's Biz Journal.

A report produced by Miami-based Condo Vultures [sic] Realty, says that three of the buildings with the highest number of foreclosures are clustered in the pricey Brickell district of downtown Miami. The Club at Brickell is number one with 54 foreclosures, The Vue at Brickell is number three with 49, and the Jade at Brickell is fourth with 42. Together the three account for more than $113 million worth of unpaid loans.

Sunday's Miami Herald reveals another aspect of this hyperinflationary bubble. Since 2005, the article says, Miami homeowners have signed on to "exotic" mortgages "at twice the rate in the rest of the country." Speculating house "flippers," (those who sell homes at the earliest legal date to turn a quick profit on price inflation) and suburbanites taking out vanity home-equity loans to remodel or expand, have all been caught in the same trap. So-called "negative amortization" loans, where the borrower loses money with every payment-- even before the rate re-sets-- and loans with low "teaser" introductory rates, which are now resetting to 16%-- rates as high as credit cards-- amount to about 20% of all loans in Miami-Dade and Broward counties.

These loans are concentrated in the "celebrity haunts of South Beach, the stately manors of Weston, the gleaming condo towers of Sunny Isles Beach and the financial district of Brickell."

Borrowers are now experiencing the same problems as sub-prime victims, as property values fall, equities disappear and rates continue to skyrocket.

A report on CBS Evening News adds a foreboding aspect to this picture of suburban collapse-- the ubiquitous, class- defining swimming pools in upscale Silicon Valley suburbs, now untended, have become breeding grounds for mosquitoes, and areas are now experiencing outbreaks of West Nile virus as the birds feed on them.