I am looking for my first purchase. I live in Georgia and always wanted a place in Florida that we can use when visiting the area and rent it when we are not in the area. I've come in contact with a real estate agent that is selling 2 condos in West Palm Beach. They own it themselves but selling both properties for $130k each. Both are currently rented and have been for 2 and 3 years respectively for 1250.00 and 1200.00 monthly. I've asked if they are good tenants and been told yes although one pays a few days late but always has paid with a late charge. What other questions should I ask to make sure of what I am getting into? They have told me they are selling and moving closer to where the bulk of their rentals are and trying to get rid of these. What can I ask for prior to the sale? Rental records? I don't want to visit and tour if things don't seem right.
yes, ask for rental records for the last couple years (roles) maintenance records, copies of the leases, find out rental rules for the condo assn if new owners buy, some have odd restrictions, find out if there any special assessments coming up in the condo. Sounds like you need a realtor if you are new and you are already talking to a realtor. He will have to split his commission with your buyer agent, so no reason to not let the agent do his/her job and do all this for you and more.
Make sure you have a seller's disclosure with some sort of a profit and loss statement. Ultimately I agree with @David Sicherman in that getting a realtor to be on your side is important for your first purchase. Make sure you find one that is well versed in real estate investing. They will know the right questions to ask. If you need any suggestions I know a great agent in the area. Let me know if you have any additional questions.
If you are going to use it yourself, you would have to rent it out as a vacation rental...a very different animal than a long term rental. In state of FL, any rental less than 6 months requires charging "bed/tourism/state/county" tax. And, cleaning/linens/towels/etc. fees need to be included in your running the numbers. I find that condos tend to be very risky investments, due to HOA fees can change whenever and to whatever they want to charge. When a there is a real estate downturn, condos are the first type of housing that gets sold, and when there are many empty units, the HOA ups the monthly fees to compensate for the non-revenue of the "foreclosed" units. Also, if renting as a vacation rental, is there an office staff that focuses on renting out for you? for a commission fee of course. If so, how do you know they will offer yours before others?
One idea, if you don't have to be on the beach, look into park model mobile homes you can buy in an rv resort. Most have no problem letting you rent out. Alot less $ output per unit to buy, with lot rent paid monthly to the community (cause you don't own the land). You can offer lower rental prices to be competitive, and won't have as much competition, and still make about the same income.
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