How Much Cash flow do you like to see for Condos?

Question

I'm looking into condo investing in my area. If some of you wouldn't mind sharing, what is your typical cash flow that you see from your condominiums? Most of the rental grade condos in my area go for about $750/mo with the tenant paying all utilities. Most are in the $70,000 range. I'm calculating about 13% of the rent revenue left over each month. Is that in the ballpark?

$750 Rent

- $100 HOA Fee

-$100 Property Taxes

-$40 Insurance

-$311 (20% down on $70,000 purchase price, 25yr am.)

-$39 (annualized 5% vacancy)

-$65 (annualized supplies & repairs of $750)

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$95 per month or 13% of the income.

Josh Bakhshi · Answer

I don't know the Iowa market that well, but we have a few condos in our portfolio. I tend not to like them b/c of the HOA fees and rules. They might be OK now, but nothing can stop them in 5 years to say that no more tenants or increase dues by $200 which would mean that you are loosing income.

How much more are single family homes in your area?

George P. · Answer

70k for $750 per month?

i'd never do that.

condos here are 33k that get 850 and still dont want to do condos

Felipe A. · Answer

Does the HOA fee include utilities?

Also, with condos, do people here wrap the HOA fee into the rent payment? Or is that an operational expense that is absorbed by the landlord?

How Much Cash flow do you like to see for Condos?

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