BiggerPockets

Hello,

I want to bid on a Fannie Mae REO located in MA. I asked a buyer's agent for a copy of condominium bylaws and a statement of financial condition. She responded "These docs are usually passed along after your offer is accepted:)". Is this a common practice to bid on a condo without knowing if it can be rented out and what kind of reservers the HOA might have?

Thanks,
Alex

Not at all. Although rare some HOAs dont allow rentals and different things that would make investors not want to purchase in such HOA's. Also make sure to know the accurate HOA fees and if the REO has back fees due.
-Scott

Though I bought into an hoa for my first investment property in 1994, Lucia is totally correct and I would never do it again. Because she is correct.

You have no control over your property, because IT ISN'T YOURS even if you have no mortgage on it. That property is a share of a corporation, and the rules are set to benefit the CORPORATION. You can't install different windows, better front door, whatever roof you want, patios, fences, awnings, etc, unless they fit the guidelines. You have a range of color choices, often about 5, to choose from when repainting.

The board can and does change the rules, and doesn't necessarily tell the shareholders. Assessments can change (increase) yearly, as much as about 20% of last years, without a vote. There can be emergency assessments, and you have little choice but to pay.
My own hoa has been pretty good. We have few amenities, are not planning any, AFAIK, and the dues are the lowest around. I do carry a "loss" policy ($40K) on my insurance, in case there is a problem.
I sold one house I had in an hoa, and will not buy into another.
FWIW, condo associations are worse.
Ofgift

I'll also add my two cents, from the perspective of a renter, I've rented from two condo owners and the experience was problematic both times. The second time was a nightmare. As a renter, if you have an issue, you're stuck in a bureaucratic nightmare dealing with the managment co., the condo board, and the owner. Every one of these entities just passes the buck to the other. I don''t know if my experience was typical, but I would never rent a condo again.

Wow, doesn't anybody like HOAs? I was actually trying to find SFRs with HOAs that take care of the front landscaping. That seems like a way to ensure that a neighborhood does not go downhill.

I'm looking in Las Vegas and with all the houses turning into rentals I thought an HOA might give my house an extra edge in value preservation and/or appreciation.

Am I nuts, or does this make sense to others?

Let's talk about the difference between an HOA and a condo. I agree with most investors here to stay away from HOA's.

What I will absolutely say, is stay away from condos. There are new Fannie/Freddie financing rules that are going to make it a royal pain to get financing. Even if you pay cash and want to sell someday this issue will bite you in the butt.

It would seem to me that for SFRs it would depend on the HOA, since some of them don't do that much, and don't charge that much per month.

What I''ve heard is to stay away from gated communities, since the gate can be expensive to maintain.