Real Estate Agent · Las Vegas, NV · Member since 2018 · 6 posts · 3 votes
I am considering purchasing a condo as a rental property. I have learned that condos have HOAs and that there are rental caps on communities like 10%, 20%, 30%. I was wondering, how would I go about finding out the rental caps on each community?
I am thinking that an HOA can handle more than one community/complex. For example, one would have 100 units and the other would have 120 units but, they both belong to the same HOA. Is this how it works? Please correct me if I am wrong.
Would I need to call each HOA and let them know the property address to zone in on the one I am considering? Can I find a list of HOAs in my city?
Any tips or advice as to what I should be looking for is welcomed!
Also, why would you want to buy in a complex with rental restrictions? It’s a good chance that you’ll run into issues there.
Lastly, If this is a lower-priced condo (under $100K) and there are no rental restrictions then I really hope you are a cash investor because getting funding for these types are nearly impossible!
All the HOA's I've belonged to represent a single community that only those members belong to. HOA's are private organizations so I don't think there is a listing anywhere.
If you're interested in a property in a complex called "XYZ" then most likely the HOA is names "XYZ Homeowners Association". See if they are listed or have a web page where newsletters are published and just try and call them.
Hi Mark. Thank you for your reply. I have called a couple of HOAs so far and left voicemails. They haven't gotten back to me yet. I will see if they have an email or another number than what was listed on the posting. I will keep on in and get the answers! Thanks, again!
I'd try to find a place that doesn't have caps on rentals. If you still want to go with an HOA that has rental caps, when you find a place part of your due diligence is seeing what that cap is and how many units are already rentals and how things are determined (ie what happens when there are more people wanting to rent than the cap allows). The selling agent should know this and working with your own knowledgeable realtor should help guide you through the process.
The selling agent might know. I would not take his word for it anyway. It is best to confirm the rules and regulations with the HOA directly. If you are buying as a buy and hold investor it is important to know if they are close to the rental limit. I had a unit that became vacant as they were close to the rental limit. By the time i found a new tenant i was not allowed to rent the unit anymore. I then sold the unit to an owner occupant.
IMO this is cart before the horse. You should find a property that works for you, and then prior to placing an offer, or after your offer while in DD you can ask about the rental limitations.
An HOA is an entity that is created to 'hold' the common area assets. So there is no master list or even a way to determine what is standard, you could have an HOW for as few as two units...and that HOA will probably have very simple cost sharing rules with no dues vs. a 100 unit complex with a professional PM running multiple complexes for a fee.
So instead of trying to get the list and criteria together and then find a property in that HOA, find the property and then confirm the rentability.
@Leah Pasco I think the order I go is analyze the rental, have your agent contact seller agent to ask if there are any rental restrictions, if there are no restrictions and it works for you, make an offer. During the door diligence period you get a copy of the hoa bylaws to review and confirm those restrictions. Then make final decision on if you cancel contract or proceed and seek advice from bigger pockets at that time based on what you learn. Having owned rental condos, I’d recommend skipping if there are any rental restrictions like a percentage allowed or requiring approval from the board because that is a big risk that can prevent you from renting the unit out based on your schedule. Good luck.
@Leah Pasco I usually just call the selling agent and ask. Also, during due diligence, there's an HOA form that is sent to you with info on the details of the association and the responsibilities of each owner.
Also, why would you want to buy in a complex with rental restrictions? It’s a good chance that you’ll run into issues there.
Lastly, If this is a lower-priced condo (under $100K) and there are no rental restrictions then I really hope you are a cash investor because getting funding for these types are nearly impossible!