{"id":170384,"date":"2024-04-10T14:27:28","date_gmt":"2024-04-10T20:27:28","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=170384"},"modified":"2024-06-20T06:06:18","modified_gmt":"2024-06-20T12:06:18","slug":"newly-built-condos-make-great-rental-properties-in-cities","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/newly-built-condos-make-great-rental-properties-in-cities","title":{"rendered":"Newly-Built Condos in Cities Make Perfect Rentals\u2014Here\u2019s Why"},"content":{"rendered":"\n\n https:\/\/www.biggerpockets.com\/blog\/newly-built-condos-make-great-rental-properties-in-cities \n\n\n\n\n

When discussing rental properties, it’s common for people to refer to <\/span>multifamily<\/span><\/a> residences. How many times have you heard someone say something like, \u201cI have 20 units under management,\u201d most of which are probably spread across just a few buildings?<\/span><\/p>\n\n\n\n

This investment approach is logical from an economic standpoint. Having four units under one roof versus just one, four rents instead of one\u2014you get the point. <\/span><\/p>\n\n\n\n

No one ever talks about condos as a viable investment option in real estate. Indeed, there\u2019s a negative connotation around the word \u201ccondo.\u201d Tell someone you bought a condo as an investment, and you can pretty much guarantee that someone in the <\/span>BiggerPockets Forums<\/span><\/a> will scoff at you. You\u2019ll hear all about how terrible homeowners associations (HOAs) are and how condos appreciate slower than single-family homes. <\/span><\/p>\n\n\n\n

Perhaps the biggest affront and final blow to your reputation would be sharing that you bought a newer condo. No sweat equity? That\u2019s blasphemous\u2014how will you ever reach financial freedom? <\/span><\/p>\n\n\n\n

It\u2019s not sexy to say that you have one unit, or that you bought a newly built property without renovating it yourself, or that you bought your deal on the MLS. <\/span><\/p>\n\n\n\n

So what\u2019s the punchline?<\/span><\/p>\n\n\n\n

Condos are the most overlooked real estate investment that anyone can access. That means less competition. For busy investors working a 9-5 or new investors trying to get into the market, this is your distinct advantage.<\/span><\/p>\n\n\n\n

Here, we\u2019ll focus on newly built condos in cities, which is where the best value lies. Keep reading to learn more about the advantages of this forgotten asset class.<\/span><\/p>\n\n\n\n

Better Location<\/span><\/h2>\n\n\n\n

\u201c<\/span>Location, location, location<\/span><\/a>\u201d is everyone\u2019s favorite mantra when it comes to real estate.<\/span><\/p>\n\n\n\n

There\u2019s a higher likelihood that you find a condo in a prime city location than a single-family property. To maximize on space, developers build up, not out. This makes condos more abundant in cities. It also means you can find them in ideal locations for rental properties. <\/span><\/p>\n\n\n\n

There are a variety of ways to capitalize on location as a condo investor. Here are just a few.<\/span><\/p>\n\n\n\n

Find the next trendy neighborhood<\/span><\/h3>\n\n\n\n

Want to capitalize on the changes happening in your city? Investing in newer condos in trendy or up-and-coming neighborhoods can offer significant potential for appreciation and rental income growth. These areas often attract young professionals and creative types seeking vibrant communities and diverse cultural experiences.<\/span><\/p>\n\n\n\n

Make sure there\u2019s access to transportation and major highways<\/span><\/h3>\n\n\n\n

Being situated near public transportation hubs or major highways enhances the accessibility of newer condos. As such, these are ideal for renters who rely on commuting or prefer the convenience of city living without the hassle of owning a car.<\/span><\/p>\n\n\n\n

Play up the convenience and comfort angle<\/span><\/h3>\n\n\n\n

Put yourself in your renter\u2019s shoes: People live in cities to be closer to work or for convenience. Within walking distance, residents will have easy access to restaurants, shopping centers, entertainment venues, employment opportunities, and transportation.<\/span><\/p>\n\n\n\n

In today’s fast-paced world, renters value convenience and comfort above all else. Newer-built condos often offer features such as concierge services, secure parking, and modern finishes that cater to these preferences, making them highly desirable rental options.<\/span><\/p>\n\n\n\n

Strong Rental Demand<\/span><\/h2>\n\n\n\n

A bigger population equals more potential renters. And in a city, there\u2019s no shortage of people. This means a constant demand for housing because of the sheer volume of renters looking at any given time. Here\u2019s how to take advantage of this.<\/span><\/p>\n\n\n\n

Stand out <\/span><\/h3>\n\n\n\n

A newer unit will stand out compared to the competition. There\u2019s a reason luxury vehicles sell for more than used cars. <\/span><\/p>\n\n\n\n

Unlike older buildings, newer condos often boast state-of-the-art features. These appeal to contemporary lifestyles and lower-maintenance living. These amenities also attract high-quality renters willing to pay a premium for added comfort, convenience, and a sense of security.<\/span><\/p>\n\n\n\n

Pay attention to demographics<\/span><\/h3>\n\n\n\n

Demographics also contribute to strong rental demand in cities. As younger generations delay homeownership and prioritize mobility and flexibility, demand for rental properties, particularly in urban centers, is expected to remain robust. <\/span><\/p>\n\n\n\n

Millennials are the first generation that\u2019s more likely to rent than own a home. It\u2019s also the largest population demographic. Millennials, along with Gen Z, tend to prefer the flexibility and convenience of renting over homeownership. Newer-build condos offer hassle-free living experiences with professional property management services and maintenance included, making them an attractive option for discerning renters.<\/span><\/p>\n\n\n\n

Investing in newer-build condos allows landlords to capitalize on this demographic shift and generate steady rental income.<\/span><\/p>\n\n\n\n

Any rental strategy can work<\/span><\/h3>\n\n\n\n

Condos in urban centers can be excellent sources of rental income because you\u2019re not pigeonholed into one investment strategy. Based on your preferences and <\/span>real estate investment strategy<\/span><\/a>, you can garner interest from renters in any of these categories:<\/span><\/p>\n\n\n\n