Is it possible to force appreciate condos?

Question

Hi BP,

Quite new here and actually, this is my first post so hello everyone. So far in my education and experience is from single-family homes, so I wanted to know what people's opinions and experiences are about condos.

MY SITUATION:

I'm currently in the process of flipping a single-family home in a moderate-income area in my city and I want to get involved with rentals as well. However, I know that the demand for housing, how much I can charge for rent, and the probability of getting good tenants is much higher on the other side of my city. But currently, I can only afford condos from that part of the city. Is it likely I can force appreciate a condo like a single-family house so I can BRRR?

OTHER MYTHS I NEED DEBUNKING:

- I'm willing to screen and find my own tenants, but I don't want to deal with the calls of something being broken. (ex. plumbing, a leaky roof, noisy neighbour). Are these what I am paying the HOA to deal with on my behalf? and therefore I don't need to account for CAPEX when putting aside money from rent?

- It is difficult to even get the cosmetics of the apartment done? If I want to put in new floors, or bathroom, the HOA will make me jump through a lot of holes before they approve it?

Thanks in advance,

Drew Sygit · Answer

1) What do you mean by, "force appreciation"? You can try to influence it by improving your unit(s) on the edge of a higher priced area and catch some overflow, but that's very hard to do in the middle of an area.

2) HOA's typically only take care of external maintenance. Each owner is responsible for everything "walls in". Perhaps the HOA has a list of preferred/recommended contractors though.

3) Usually HOA's dont care what you do inside your unit as long as it doesn't affect the structure.

Given your cell phone issues, you probably should just hire a PMC to make sure you don't get blindsided by an emergency.

Sanglak Choi · Answer

The reason I'm unwilling to deal with repairs is that I also have a job that sometimes sends me to locations where I don't get cell and internet services. So I don't want to be absent when the tenant needs me, and I currently don't know anyone or a property management company that I trust enough yet.