I'm thinking of investing in a 2 bed, 3 bath condominium in Bridgeport, Ct. The asking price is $175,000. The HOA fees are $150/mon, Taxes $300/mon. Most similar properties in the area have been leased for between $1500 to 1700. The property was built around 2007. Its in very good shape.
My plan is to put 25% down.
What do others here think of this as an investment opportunity?
Property Manager · CT · Member since 2014 · 687 posts · 329 votes
7y
@Mian Rizwan yes it’s possible to do negative gearing however you need to have the cash to support it for 20 years.
It’s also a bit of a speculative gamble as you do not know if the appreciation will be what you want. Especially in a market like Bridgeport Connecticut where the appreciation is not guaranteed.
Also, because of a life change you may need to sell early, and at a potential loss.
You are 1 major repair or major vacancy away from loosing your gains.
St. Louis, MO · Member since 2017 · 32 posts · 5 votes
7y
@Craig Bellot
What if a person does not immediately need cash but thinking of doing this as a Passive investment which will pay off in say 20 yrs , does it makes sense then ?
Also can you PM me your contact, maybe we can talk over phone / coffee sometime ?
Property Manager · CT · Member since 2014 · 687 posts · 329 votes
7y
@Mian Rizwan yes it’s possible to do negative gearing however you need to have the cash to support it for 20 years.
It’s also a bit of a speculative gamble as you do not know if the appreciation will be what you want. Especially in a market like Bridgeport Connecticut where the appreciation is not guaranteed.
Also, because of a life change you may need to sell early, and at a potential loss.
You are 1 major repair or major vacancy away from loosing your gains.
@Mian Rizwan"What if a person does not immediately need cash but thinking of doing this as a Passive investment"
That would be speculating not investing. Investing is done with a expectation of earning a relatively consistent income return on the investment. Speculation on what may or may not happen in the next 20 years, whether you even live that long, is a entirely different animal.
Condos are generally a poor investment vehicle due to unpredictable rises in condo fees and special assessment by the HOA. This on is not a good investment income wise, speculation wise it is always a crap shoot best left to markets that show consistent high appreciation. Never count simply on mortggae pay down as a plus, it can vanisk in a heart beat with a turn in th emarkets.
If you are into high risk go for it but expect to be suplimenting your investment out of pocket.
Appraiser · Easton, CT · Member since 2015 · 94 posts · 98 votes
7y
@Ali Syed I would suggest looking at a multifamily property instead of a condo in Bridgeport. Much better cashflow for the investment. If you're concerned about multiple tenants and want a passive investment, hire a property manager like @Craig Bellot.
If you look into the cities, you will get better cashflow, but you are also dealing with a different tenant base.
How come you are in looking in CT? I have read Kansas City as great cashflow.
I am not looking to invest out of state at this point. My friend Ali however was thinking of investing in Bridgeport CT market and I was brainstorming this with him
I work/ live in STL , MO and have developed some connections there over the yrs so comfortable with that market.