Miami Condo Market: Bust to Boom?

"The kind of buyers we get they don't need financing, they're all cash buyers," says Margulies. "It's a lifestyle they have, so they're not reliant on a bank to give the money."

Most of the foreign buyers in Miami are renting the properties to locals who have either lost their homes to foreclosure or whose credit is not good enough to get a home loan in today's tough U.S. mortgage market. The question now is, what happens to all these renters when Florida's single family housing market recovers and credit opens up again? Will all these foreign investors want to unload their units at the same time?

"You wonder if we're not kicking the can, where we dealt with the problem at hand by dumping it off to foreign buyers, and now as the domestic buyer starts to move back into the marketplace, is that domestic buyer going to pay the same price that the foreign buyer is willing to pay or take the same chances that the foreign buyer is willing to pay?" asks Zalewski.

It all sounds frighteningly familiar.

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