Would you invest on condominiums

[Jefson Louis]

What y'all think about investing money on a 2 bedroom 2 bAthroom condo. People say condos are not good investments I just want to rent it out.

[Thomas S.]

Condos are generally a bad investment. HOA is your landlord and you are the tenant. HOA fees are unpredictable and special assessments for building upgrades can be in the tens of thousands. Appreciation can not be counted on to add any long term benefit.

If you look at Justin's example above you can see some discrepancies. The taxes are confusing as I think the amount listed is for the year not by the month otherwise he is negative cash flow but he has not included any return on the equity in the property (30% of property value)  or insurance, vacancies, utilities when vacant, general maintenance (appliance replacement, flooring, painting, etc.) advertising etc. etc. etc.

When you consider HOA fees will rise combined with special assessment risks and possible interest rate rises this investment without appreciation is probably not going to cash flow long term.