I recently bumped into a good deal on a condo apartment from a wholeseller. I didn't even had the chance to place an offer before it was gone. I had a few questions and by the time it took me to start looking for answers, it was too late. I wanted to clear a few things in case It happens again.
In a deal like this, how do you guys deal with the HOA, meaning, do you investigate about active/potential special assessments? Age of the roof to predict whether you'll get welcomed with roof replacement notice? Lease regulations??
These things take time to find out, and with good deals from a WS...time is not abundant.
Thanks in advance!
@Allende Hernandez With a condo you should always do due diligence before submitting an offer. You can always call the HOA and ask them about any potential assessments. They do not always provide this information but it is worth a try. You also have an inspection period which you can cancel the contract if it does not pass your inspection. It really shouldn't take too long to analyze the deal and make a quick offer.
Hi @Jack V. Ospina for a listed deal, yes, that is a possible path but for a wholesale deal the story is completely different. There is no inspection period for the most part or it is very limited. Also, these deals fly in less than half a day with no time for a detailed due diligence.
I know this does not answer your question but I think this sounds more like you should try other avenues of acquisition. In my opinion there are too many factors involved in an association that could disqualify the property as a deal and many of those things are not feasible to acquire in a couple of hours or perhaps even days.
If you took the time out to learn about the hundreds of condos we have in Miami, then working with wholesalers would make greater sense. But since that’s not feasible for most, there are realtors that specialize in certain areas and are well aware of the associations within their area.
Aside from realtors, you could always prospect yourself which I find so much more convenient with condos. Just find a qualified condo in a building that has a decent amount of units and send a couple rounds of mailers to the owners.
Prior to sending the mailers I like to offer a little less than my MAO on currently active properties in the same building to have an idea of how low I can already get with on market properties. I have also considered putting a bandit sign in the exit of the association over the weekend to hopefully find an off marker seller.
Last thing I can recommend is to build better relationships with the wholesalers that are actually providing real value to you. Even when they tell you that the property is sold, continue analyzing and find out whether you would really pay asking price after knowing all the financials, recent repairs, board of association, recent changes in regulations, etc. Practice makes perfect when it comes to analyzing and you will also notice which wholesalers are sending you deals and which aren’t.
Hope this provides some insight. About to hit the sack so excuse any typos above.
Thank you very much @Gabe Amedee . That is exactly what I see, buying condos from a wholeseller seems like a real gamble. Too many unknowns that are usually hard to clarify for a quick decision.
I am sure that is to my uneducated eye, there must be very successful investors around here that have a way to make this a less risky move. It'll be great to get their input.
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