Condos In Vegas-MGM or Palms Place?

Question

Hey guys/gals! I'm starting to establish my residency in Las Vegas and currently leasing a property at MGM Signature. I would like to start buying in there or Palms and I'm wondering if anybody has any of these and has any advice between the two places or if these seem to be a winning investment? From the research I've done it sure seems like you can't go wrong but just want to be sure...any advice is appreciated!

Brian Ichikawa · Answer

There are some units that the sellers are willing to finance if you put enough down.

Upen Patel · Answer

Getting financing for Condotel is hard, but not impossible. Find a good mortgage banker to work with you and you will be fine.

Louis Davis · Answer

@JJ Resnick,

Welcome to Las Vegas. I am an active wholesaler out here and got a pretty good pulse on the rules of how these deals have to work. It's always about the numbers and seeing if the deal makes sense for you. How much would it cost you to buy it? How much is the average rent and calculate the return on investment. If it makes sense for you then find out how to get funding which if it is a good investment won't be hard to find. Hope this helps.

Louis

Alisha Wagner · Answer

@JJ Resnick Welcome to Las Vegas! I was looking into Condotel's at Palm's Place and MGM awhile back, but I was concerned about exit strategy. It is very difficult to obtain financing for these "Condotel" type properties, because it not a traditional condo --and I'm guessing most banks can't wrap their heads around this concept loaning on hotel room.  If the financing aspect is an issue for most buyers, then it might limit you to cash buyers or the smaller percentage of those who secure the financing for the deal.  To sell it, you have to consider that Condotels appeal to a very niche market, other investors or possibly vacation home buyers.  Then they would have to be all cash or part of the small percentage the can obtain financing.  It severely narrows the pool and which could make liquidating quickly an issue. You might want to find out how long some of these condotels have been on the market and find out who finances them.

Also, the condo fees are extremely expensive. Yes, you get a lot of perks as a result of those high condo fees (ex. front desk services, maid services, etc), but as with most condo associations there are a lot of rules to follow.  There might be limitations on how many owners could rent their units out and how long they can rent them out.

Not sure how you were thinking about investing with Condotels, but definitely consider your exit strategy and do your due diligence!  Good Luck!