ML-Implode News - Money laundering, Capital Flight are shaping US cities

In a little-noticed statement, the Treasury bureau responsible for investigating financial crimes shared a remarkable money laundering statistic last month. Thirty percent of the cash purchases of high-end real estate by shell companies in six major cities involved a suspicious buyer, according to an investigation conducted by the Financial Crimes Enforcement Network to find out who was behind the deals.
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Another problem, separate from affordability, is that foreign investor ownership of properties in pricey neighborhoods tends to turn those neighborhoods into museums.

In some neighborhoods, the condos may be sold out -- but empty. In Manhattan, for example, the blocks between Lenox Hill and Central Park, between 63rd and 70th Streets, are nearly 40 percent unoccupied, according to the Census Bureau. On the Upper East Side's most exclusive tract, along Fifth Avenue, more than a quarter of properties are vacant.

The reality is similar in other exclusive neighborhoods throughout the country. More than half of the beachfront properties in the neighborhoods at the ends of Miami Beach, Bal Harbour and the southern tip of South Beach are unoccupied. Because of unoccupied downtown condos, the South Beach neighborhood of San Francisco is one-fifth unoccupied, in the middle of one of the tightest housing markets in U.S. history.

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Money laundering, Capital Flight are shaping US cities