The problem is there are many single family home “condo” communities. One in particular is new and makes good returns on airdna. I also checked the covenants to see if short term or long rental is allowed, both are. My partner thinks this is a bad decision regardless but I think the cash flow potential is amazing and know it would long term great as a backup with incoming recession… is it ever ok to buy a condo for investing?
It can be. For STR it is safer bet if a lot of the owners in a unit also rent theirs out that way, which is what you see on the coast of Florida, Carolinas, Hawaii etc. I would just be sure that you have a Plan B and C, mainly that the numbers work as a MTR or LTR.
Real Estate Agent · Central Coast, CA · Member since 2022 · 110 posts · 58 votes
4y
My biggest hesitation is that while the current CC&R's for that condo complex may allow for STR, there are A LOT of communities throughout the country that are changing their laws and ordinances to make it more and more difficult to rent for under 30 days. It would worry me that my right to STR might get taken away after purchasing a condo. If the math makes it possible that you could still cash flow by renting out 30 day+ intervals, it might still be worth it. But if the math ONLY works if I can rent it out short term, I would pass.
Specialist · Indianapolis, IN · Member since 2021 · 312 posts · 282 votes
4y
@Kendra Buttersworth It's okay to buy a condo and I've known many people who have made money - but it's risky. You're at the whim of the HOA, who can pass rules that immediately make the deal unprofitable or limits your tenet pool.
Depends on your risk tolerance and how much control you're willing to give up. When buying, comb through the CCRs!
Realtor · Scottsdale, AZ · Member since 2018 · 64 posts · 47 votes
4y
I have invested in a number of condos in Scottsdale and have good returns. You're thinking the right way - ensuring you have a plan B should the STRs be disallowed in the future. I find the HOA fee on my investments are lower than my pool and yard maintenance on a SFH. I invest ins smaller condos - 1 BRs and it appeals to a mass market. I do LT rentals and have 0 vacancy, always renting before I close and immediately after a tenant's lease expiry. I recommend checking all the financials and CCRS prior to buying and attending/joining the HOA to be well informed in financial strentgh and any changing attitudes on STRs.