Whether it’s a single unit or a multi-unit property, buying a condo can be a good investment if you can get a good tenant. You could also fix it up and try and sell it. Condos are often more affordable than single-family houses. Before buying a condo(s), you should first do much research on the unit, location, amenities, homeowners association fees, and other factors. Here are a few condo investment tips.
There might be some financing difficulties. Mortgages for condos are often more challenging to be approved for than mortgages for a single-family home or even multifamily property. So don’t get your hopes up if you see any condos for sale at a low price that seems too good to be true. This price is a huge red flag and a sign that the financing at the location is very difficult to obtain.
Research regulations and association fees in any property you are interested in. Getting the mortgage is the first step. Additionally, there are going to be condo association fees for the maintenance and upkeep. So even if you purchase the entire property, including every condo unit and the amenities, you’ll still be responsible for maintenance costs.
In most places, owners are part of a condo association. So one of the most critical condo investment tips is to do find out what the association is like, what is expected of members, how much property taxes and utilities you will be responsible for, what the monthly fee is for each member, and if the money you get from renting it out will be enough to justify those costs, loan payments, and enough profit for you.
Condo Investment Tips for REITs
You don’t have to directly buy a condo to invest in one and to receive profits. There are other options like REITs that center around apartment and condo rentals. Let them take care of all of the hard work for you. You can still get some of the perks of owning condos but won’t have to play landlord. Look for REITs that have proven themselves to be resilient during times of decreased rent prices.
Another option is to buy a condo, renovate it a bit, and try and sell it. Condo investment tips for flipping are to focus on both the average home and condo sale prices in the area AND the condo rental prices in the area since the individual(s) you sell it to could either be someone interested in living in the condo or investors who are looking to be landlords.
These suggestions should give you a start. Then, get even more condo investment tips and ideas from Motley Fool Millionacres. It serves as a comprehensive resource to help all investors learn about the ins and outs of real estate investing, from condo flipping to REITs.