Units at Majestic Towers range in price from $1 million to $5.7 million, which also nets you a sleek, high-ceilinged lobby and waterfront views. Why should some harmful fumes and highly explosive chemical compounds keep you from scoring a huge discount on your dream home?
Especially when you consider just how bleak the housing inventory is in South Florida: It’s a sellers’ market and once a property’s listed, it doesn’t stay that way for long. With minimal new construction and a lack of affordable housing, prospective homeowners in Miami might find themselves willing to compromise a little more than anticipated.
How much of a compromise?
Well, if you’re among the roughly 50 percent of 3,000 prospective Florida homebuyers who participated in a survey on behalf of American Addiction Centers (AAC), investing in property that was once a clandestine methamphetamine production site or drug den is all well and good — as long as the seller is willing to come down on the asking price by as much as 44 percent, which, uh, good luck.
It goes without saying the other half said hell no.
A spokesperson from American Addiction Centers tells New Times that if survey participants indicated they’d be willing to purchase a former meth property, they were then asked how much of a discount they’d require to sign on the dotted line; the 44 percent figure is the average.
AAC also pointed to an interactive map generated using location data from the U.S. Drug Enforcement Agency, which allows one to plug in an address and see how close the residence is to the nearest known drug den. In Florida, 877 known properties once were clandestine meth labs, according to the most recent data.
“Throughout the pandemic, people across the country have been moving out of city centers into more suburban neighborhoods in pursuit of more space, now that so many are working from home,” reads a statement from AAC announcing the survey results. “Record prices with low inventory means that buyers are becoming more desperate to secure a home, with many foregoing [sic] their previous ‘red lines’ in order to secure a deal.”
One’s willingness to invest in a former drug den aside, it’s entirely conceivable that, if you’re in Florida, you may be none the wiser. That’s because real estate professionals and/or sellers in general aren’t legally obligated to disclose any event or circumstance that may have occurred inside a house if it doesn’t outright affect the material value of the property.
Former drug dens, untimely or suspicious deaths (i.e. suicides or murders), former squatters’ quarters — as long as nothing transpired that would affect the property’s value, disclosure is at the discretion of the seller.
Take, for example, the case of Zev Freidus, who purchased his Boca Raton waterfront mansion in 2013.
When he bought the $2.7 million property, Freidus tells New Times, “it had the stigma of being a squatter house.”
For about three months, a then-23-year-old wannabe hip-hop artist named Andre “Loki” Barbosa tried to assume ownership of the property, which was unoccupied at the time, citing a little-known Florida law known as “adverse possession” and establishing an embassy for a religious group to which he belonged. The group, Divine Province, preached that its congregation was exempt from the laws of man that dictate who and who doesn’t own property.
Loki and some of his associates changed the locks and posted up in the home between December 2012 and February 2013 and used the picturesque mansion as the setting for his music videos — causing outrage among neighbors who worried that the unorthodox circumstances would drive away legitimate buyers.
After the incident drew national media attention, Freidus, a Boca-based real estate broker and president of ZFC Real Estate, lawfully purchased the home and moved in with his two children.
Now, Freidus says in an interview with New Times, he’s firm in his stance that the “squatter incident,” as he calls it, is not something that would ever have a bearing on the value of the property today.
Stigma, he says, is not a legitimate factor when it comes to assigning material value.
“As a professional in the industry, I know that [stigma] doesn’t matter,” Freidus says. “I also know that sometimes people think it matters and that the stigma affects them and they don’t want to move into a house where something bad happened. But it really doesn’t matter.”
That’s not to say Freidus would refuse to disclose to a potential buyer that the property they’re considering investing in used to be a former drug den or squatters’ digs (though neither of those scenarios has ever come up, he says). But if it’s something abstract and doesn’t affect the property in the present, it’s not going to be top of mind in his pitch if at all.
On the flip side, you have Catherine Resek, a longtime Miami-based real estate agent.
When it comes to the history of a property, Resek tells New Times, she always opts to disclose, disclose, disclose, even beyond the parameters of what is legally required of her and the seller.
Former clandestine drug den? Disclose. A murder occurred on the premises? Disclose. A home that was once a hub for mobsters 40 years ago? Disclose.
The way Resek sees it, if it doesn’t come from her, it’ll inevitably come from someone else.
“Even before the market was crazy, if someone was going to make an offer on something we knew could backfire, we would make them aware of everything,” she says. “The more knowledge you have on an investment, the better.”
Besides, she adds, “every place has a story whether we know it or not.”