Possible condo deal. Need opinions.

[Carlos Rovira]

I've got a potential deal here and need some advice. Here it goes: It is a 2/1 Condo unit in Hialeah, FL (a very competitive rental market). Price: $80-85k (market value ~$105k). Potential Rent: $1,300/mo HOA Fee: $215/mo (includes flood insurance) Insurance: ~$90/mo (aside from flood - hurricane, fire, etc.) Taxes: ~$90/mo Mortgage PMT: $350/mo I am paying using an equity line of credit from another property so I'm essentially putting zero down. Plan is to refinance and recover the equity line to continue buying. My concerns are the following: 1) I've never owned a condo and the idea of an HOA scares me 2) I'm buying this from a "pushy" wholesaler (no offense to wholesalers) who wants to close quickly and not allow me to have an inspection period. The wholesale company bought it at auction and has been holding it for a few weeks. Red flag? The cash flow is excellent, so it's hard to turn away from the deal. Thoughts?

[Chris Seveney]

If your buying a property that is $20-$25k below market value and is an auction property I would damn well want to do an inspection as you can spend that pretty quickly.

Also for a condo, make sure to get a copy of the condo documents as well as the last budget the association did. 

Also ask for information on the condo board and contact them and see if there are any special assessments planned or large capital purchases/improvements in the next five years.

Also ask what the HOA fees were for the last five years (to see a pattern if they are rising)

 I had a condo under agreement and the seller "forgot" to tell me there was a $7,000 special assessment (condos were selling for $40k) - when I went back to the seller they noted the price was based on the assessment. Needless to say the deal fell through.