Cooperative Condominiums

[Alexandra Preziosi]

I am a new, aspiring real estate investor for New Jersey with limited disposable income, so New Jersey's high priced housing and high property taxes have definitely made it difficult for me to find a feasible him investment to say the least. I do, however, come across some cooperative condo listings that are very enticing due to the relatively low cost listing compared with a similar non-coop in the same area. My question is whether these coop deals are ever worth looking into? I understand one constraint is often the inability to rent out the space, which seems to be pretty major. I am just wondering if perhaps these sort of properties might be a good buy and hold property instead? Also if anyone has advice for a new investor in NJ, all suggestions are appreciated ! Thanks!

[Dan Chandler]

Just beware of HOA fees, if there are any. I bought a condo years back with the intention of renting it out when I was ready to move on to a house. But the climbing HOA fees made it impossible. They stay low as long as everyone is paying them, but if you get in a development where people are not paying the HOA fees will skyrocket. We bought a condo out in Jackson in 2007 and the HOA was $120, it is now more than double that. The condo is long gone but I have a friend who still owns a condo there and said the fees are getting out of control. Unfortunately there is nothing you can do and there is no way of controlling them, it can turn a good deal into a very bad one within a few short years. I'm not sure what the fees, if any, are on coop's but beware because it is simply out of your control.

Good luck in your search!!