Buying Condos/Townhomes In Good School Districts Good Strategy?
I am a newbie in a hot market. I don't feel like I have the connections or credentials to find "good" off market deals yet. I have some friends that flip and we've already spoken about doing a project in the near future but I have a baby coming in late October and I'd ideally like to make my first acquisition and have a tenant in place before that happens.
I've started to narrow in on a strategy that I think is decent and I'd love to hear any feedback on positives or negatives of the idea. Initially I was turned off by the idea of condos but given my situation I feel like the positives of being a condo landlord outweigh the negatives. So at the moment I am looking at stable suburbs of Columbus, OH with good schools where I can get condos under $125,000 that I should be able to hit the 1% on. I don't think there is much upside potential for appreciation but the lack of exterior maintenance is appealing and my guess is that it's a good way to get long term tenants, i.e. families that are there for the school district and less likely to move.
I like the idea of not having to spend too much on the first deal or two to get my bearings. I feel like I can't lose too bad if something goes wrong on a less expensive unit part of a larger complex if I do my homework regarding the HOA and assessments.
Positives and negatives of this? Would you personally choose single family homes over condos in similar areas? Anyone love or hate condos?
@Josh Quinn I do not have any experience with owning condos but I have put some through my pro forma and none have worked for me.
I prefer small multi family because you have a lot more control over them. HOA could decide to raise fees at any time.
Oh yeah that is for sure my preference as well. But being from Columbus you understand our market right now. Duplexes to fourplexes in any reasonably safe appreciation bet right now (Southern Orchards, Weinland Park, Merion Village, Franklinton, even Linden really) are all being split and turned into condos so it doesn't feel like a buy and hold investor can afford to get in right now. I feel like with Columbus' growth expectations there is tremendous upside in the next 5-10 years and I'd love to own more down here but I want to at least break even while I am holding. Leaving 270 feels like the only way I can do it right now. I feel like the only way I can do it is a complete gut job rental / auction, which I am not opposed to in the long run. I've personally rehabbed all three houses I've owned and have retail stores I have essentially built all of the fixtures for and feel like many of my operational skills from that are transferable to this. I am just looking for something safe and relatively turnkey for my first deal to learn the ropes.
Josh Quinn If you want I can add you to my multifamily MLS distribution list. I sometimes see some turnkey properties that would definitely allow you to break even. I also regularly call off the market looking for deals as well.