Condo vs multi unit property

3 Replies

Ok, so I searching for my first rental property, well not really my first because I have owned a couple others but sold them.

In any case, I put an offer in on a condo following the rule of buying 20% below FMV, and it was countered but still not even close to where I needed it to be for it to work.

I researched about 25 properties viewed 4 and put an offer on 1 and it didn't work out.

I'm really pumped to have this play out the way it did, and learned from it.

I'm considering forgetting my conventional mortgage and getting a commercial mortgage and purchasing a multi unit property instead of a condo.

Interested in hearing opinions on that?

I have done both. If you are comparing to a condo; you are better off with a 3/6 flat. You will save on the HOA fees. However, on the resale value you will be restricted to the cashflow / cap rate valuation. Unless, you plan correctly with a exit strategy that would allow you to convert with zoning each unit into a condo and thereby selling them one off at condo FMV. But be careful if the lender will approve; another note the rate lock on the commercial may be shorter as well as the amort schedule. location; location; location. Good Luck.

Originally posted by @Kevin Bowen :

Ok, so I searching for my first rental property, well not really my first because I have owned a couple others but sold them.

In any case, I put an offer in on a condo following the rule of buying 20% below FMV, and it was countered but still not even close to where I needed it to be for it to work.

Interested in hearing opinions on that?

Have you explained to the seller that you cannot accomplish your dreams of a real estate empire if they will not sell to you at 20% below market value? 

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