Buying a Condo or Apartments Pro and Cons
You’re like most people and I mean by that you want a better financial future than their present, well at least not worse. So, you set the money aside and start thinking of ways to make this money grow. So there are many options, but you have selected as your real estate investment field, and you are thinking of condominiums.
Condos have considerable more advantages over single-family houses or buildings of 2-4 units.
Of course it also has several drawbacks. I have had different conversations with people, who have invested in condominiums, few were aware of them all. And here they are.
Some advantages of Buying a Condo or Apartment
Maintenance
Maintenance should be done on all properties. Condos, especially condominiums that are well managed, offer some good relief to investors in condos.
You do not have the need to worry about the roof, stairs, landscaping and others. The association will takes care of them. For an extra feed It is true, but you will not have do this task. Some of the problems within the unit can also be served by the maintenance team complex. This varies from condominium association to the condo association. And they do charge for it, but do not have to drop everything you are doing run to your condo because the sink is leaking or any other mayor problem.
Buying a Condo or Apartments Prices
some apartments are really expensive. Nevertheless, the homes of similar size in the same neighborhood cost even more. Therefore, you can buy an investment property in a better neighborhood. Moreover, in most areas, there is no such thing as a 1 bedroom house, but yes there is 1 bedroom, and in some case no even no bedroom, condominium units. And there are people willing to rent these units.
Services when Buying a Condo
Services vary from condominium association to the condominium association. However, it is possible to invest in a condo in a complex location, with swimming pool, security 24 hours, and stuff.
The disadvantages of Buying a Condo as an Investment
Regulations
Rules are rules and you have to follow them and this are not necessary yours. Every association has its own regulations. And the regulation “rules” can change. Any rule can change and one of them is weather more tenants is allowed or not. So if you own a condominium and the association votes against more tenants, when you’re leasing it up, whether moving in or sell. Your association may decide to go with the rule of ‘no more’ tenants when you are selling and all this when the sale is not really profitable.
It May be worse if they decide to allow more vacation. Having too many renters can make it difficult to get a mortgage “FHA and some others don’t like condo associations, which are rented by more than 10% of the units.” This makes the resale of your investment not an easy task, to say nothing of refinancing thereof.
Sharing decision making
Yes, you can make sure you have something to say about the decisions, also getting yourself elected to the board directors will help, yet you are not the only one who makes the decisions.
Association rates
you have to pay the same amount if your unit is rented or vacant. It is to say, you have to pay the same amount even if you are not using the services, a good example is the portion of the water bill of the evaluation.
Special Assessments if buying a condo or apartment
You bought your apartment or condo unit, no special assessments and none is being studied. After some months later, the partnership decides it’s time for a new look and not enough money in reserves. The association decides to go ahead and offers a facelift and pay special assessments. Y our participation will be double its profits over the next 20 months. It can happen.
Right, things can go wrong with an investment of a single family or apartment building investment. But you have to have more control. Because you hire a home inspector inspect the entire structure. Because there is no member of the Board of Director whose boyfriend owns a construction company that may use some thousand dollars.
So, in general, buying a condo as an investment, not the way forward. That is, if you can afford a house. A single house is just not the best way to go, so if you can afford a building of a two-unit building is not the best way to go if you can pay a building of 3 units and so on. And there are two good reasons: when a condo is empty (or maybe a townhouse) the source of income banishes yet all expenses are still there.
In any case, if you are buying an apartment in an investment property, you need to the deal you’re getting into.