Condo in association that currently has 51% of the units rented

[Christian Ivanov]

I fount a good cash flowing condo in an association that already has a lot of rentals 51%. My concern is that if I have to sell it in the future my pool of potential buyers is limited to investors only since it is difficult to obtain financing for associations that have over 50% rentals. Fanny and FHA guidelines. So what should I do. Buy or skip? Total payments are $620 and I can rent it for $1,150.

[Linda Weygant]

The new FHA guidelines (as of October 2016) state the following:

No more than 50%** of the units can be investor owned / rentals

• **10/26/2016 update – There is an exception to this rule, which reduces the required owner occupancy to 35%. A special set of additional guidelines will apply. The exception is only given to existing condo complexes with at least 3 years of very stable finances, and low delinquency rates.

So as long as the delinquency rates remain low and there are 3 years of good finances, you can have up to 65% of the condos be rentals and still attract FHA buyers.