Residential Real Estate Broker · Addison, IL · Member since 2015 · 14 posts · 0 votes
My Wife and I have been visting the same resort (condotel) in Florida for about 8-9 years. We love the place. The people, the atmosphere, the location, etc. We had talked about the idea of owning a unit and being able to come down when it's vacant with the possibility of income from unit as well. We've met some residents "snowbirds" as we call them in Chicago, who come down for months at a time and stay in the same unit. We know that the place attracts those type of people who are willing to plunk down that kind of cash and avoid the chicago winters. I'm new to investing but I do have real estate agent experience. My questions are: 1) Do these types of investments make sense for someone not necessarily looking make A LOT of money from it but rather have the convenience of a vacation getaway with the possibility of income? 2) What are some things I need to be sure of on something like this?
I am familiar with terms like NOI, and ROI and trailing 12 and I will look at all that before we make a decision. Any help would be appreciated. Thanks!
There are a ton of things to consider. Who will be listing it when it's empty? Who will be showing it? Who will be maintaining? Who will be cleaning it upon departure of the guests?
Let's try again - We have owned several condotels and have found them not to be good investments. The operating costs soak up too much of the revenue and they can be hard to sell. Good luck.
Thanks, I was wondering about the end game too if we wanted to sell it some day. The particular unit we were looking at has been on and off the market for about a year. Seemed a little unusual as the management company and the resort itself is great! I spoke with an investor friend who foreclosed on his own unit in that complex when the crash happened. He said he loved the place. He mentioned that 35% goes straight to the management company and then you have your HOA dues. The management company cleans the unit. I was running some numbers and yea it didn't seem like we would make a killing on it but we would make some decent profits with the benefit of using it when its vacant and we have the opportunity. The management company rents it out for you (they rotate the units if someone just calls and wants to book) so it's good that they will fill vacancies. But it does sound like it eats well into profits. But since they fill vacancies on a rotation basis we figured it would be a load off our shoulders to market and try to get renters in their ourselves.
HI Randy. I was looking into a condotel as an investment as well. I was wondering how you are getting financing? I have been looking around and conventional loans for condotels do not exist as far as I can see.
I'm thinking about buying one and everyone has bad things to say . I happen to know someone who has several million invested in condotel and that's all he invests in and makes a killing . He only invests in 2 specific spots so not sure if he's done his research or what .
I'm curious about this as well. We have a child who is going to college in an area where condotels are popular. I'm imagining that we'd use it a couple of weeks a year, and it seems like making a even a little bit of money would be better than the hotel bills I'm envisioning.