Condo Investment - I Would Be Careful
In many parts of the country, residential condominiums are very inexpensive. Even here in the San Francisco Bay Area, some condominiums can be purchased for under $100,000.
While the condos may appear inexpensive, condo ownership is filled with hazards.
Many people forget that when buying a condo, you get the condo association too. Some associations are better than others. You may run into the unfortunate situation of a poorly run association that has not set aside sufficient funds for reserves. In this case, escalating home owner's dues can quickly erode any cash flow.
It is wise to thoroughly review any and all documents relating to a home owner's association. Read the meeting minutes, budgets, and bylaws before jumping in.
Also attempt to determine the percentage of owner occupied properties. Some lenders will not finance condos that belong to an association that have a majority of units leased to tenants.
If you want more information about investing in real estate, head over to http://www.maclennaninvestments.com/blog/. Or give me a call at (925) 385-8798.
Comments (2)
Thanks for the comment David. Condos were higher than homes in most of the US but the correction has taken its toll on values.
Peter Maclennan, almost 13 years ago
This is all good advice and are things that end up surprising most buyers later. The cheapest condo up my way costs more than most houses in the US
David Wedemire, almost 13 years ago