First future rental property question/help

6 Replies

There is a foreclosure on a condo in my area that is in pretty good shape for ($60k). The condo fee is $230 and the taxes are $1300/yr. The comps are renting for $1325 to $1500. I'm new to this and I am SUPER nervous. Would this be a good investment/second income? 

@Ronnie Gilmer  

make sure you do your math before. Does this property need any repairs? Make sure you account for all costs. Keep in mind, the HOA fees can and most likely WILL go up!! They will eat into your cash flow.

Originally posted by @Josh Mitchell :

@Ronnie Gilmer 

make sure you do your math before. Does this property need any repairs? Make sure you account for all costs. Keep in mind, the HOA fees can and most likely WILL go up!! They will eat into your cash flow.

Thanks for your input Josh. Are the HOA fees usually the "condo fee"? (Sorry I'm a super noob)

I would stay away from condos.  You never know what the association will do.  You might cash flow well for a year or two then they hit you with a new fee that wipes out your earnings.  

I would recommend looking for a comparable property that does not have a HOA fee.....cushions your cash flow and no surprises.

@Ronnie Gilmer  

I would assume the "condo fee" would be the HOA (Homeowners Association). Most times with condos these fees cover things like yard maintenance, common insurance, maybe some utilities, trash pick up, etc., clubhouse, pool. You will still have to get insurance for the interior of your unit, as the common insurance is for the outside of the building.

the projected rent to purchase price is strong. Make sure you can get the rent. call other units in the complex to verify. add up your rehab and projected maintenance costs. otherwise, TI at 338 per month is low- dont forget about insurance and PM costs too- good luck

Originally posted by @John Santero :

the projected rent to purchase price is strong. Make sure you can get the rent. call other units in the complex to verify. add up your rehab and projected maintenance costs. otherwise, TI at 338 per month is low- dont forget about insurance and PM costs too- good luck

 PM? Does that mean Project Management?

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