Client is considering selling her condo in Santa Monica

Member since 2020 · 19 posts · 7 votes

I do aquarium maintenance, and one of my clients is thinking about selling her condo because the HOA fees are over $4k. Her mortgage is a little over $3100. The ocean view is beautiful. If she were to agree to seller-finance, would STR be an option? I know Santa Monica and LA overall has guidelines on STR's. I was also thinking of wholesaling it. I'm open to all opinions.

0 Reply

16 views

Most Popular Reply

Jon Martin

Member since 2022 · 1k+ posts · 1k+ votes

Whether or not a unit is seller financed is irrelevant in regards to STR regulations. STR regs are set by the county and/or city first and foremost and apply to all properties within that jurisdiction. HOAs can also restrict them at any time with no recourse for the property owner beyond joining the HOA themselves and attempting to change the rules.

Are you saying that the HOA is $4K monthly or annually? A $3100/month mortgage in Santa Monica with an ocean view sounds like if you mean annually but if you mean monthly, no thanks.

2 Reply

See this reply in the discussion

6 Replies

Jump to latestLatest

Sort by

Jon Martin
Member since 2022 · 1k+ posts · 1k+ votes
2y
Whether or not a unit is seller financed is irrelevant in regards to STR regulations. STR regs are set by the county and/or city first and foremost and apply to all properties within that jurisdiction. HOAs can also restrict them at any time with no recourse for the property owner beyond joining the HOA themselves and attempting to change the rules.
Are you saying that the HOA is $4K monthly or annually? A $3100/month mortgage in Santa Monica with an ocean view sounds like if you mean annually but if you mean monthly, no thanks.
2 Reply
Jesse Ruiz
OP
Member since 2020 · 19 posts · 7 votes
2y
Quote from @Jon Martin:

Whether or not a unit is seller financed is irrelevant in regards to STR regulations. STR regs are set by the county and/or city first and foremost and apply to all properties within that jurisdiction. HOAs can also restrict them at any time with no recourse for the property owner beyond joining the HOA themselves and attempting to change the rules.
Are you saying that the HOA is $4K monthly or annually? A $3100/month mortgage in Santa Monica with an ocean view sounds like if you mean annually but if you mean monthly, no thanks.
The condo was purchased over 15 years ago. The HOA monthly fee is ~4k. According to Airbnb, unhosted rentals need a rental length of 30 days or more. That's insane.
0 Reply
Michael BaumPro Member
Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
2y
Sorry @Jesse Ruiz, but this is a no-go from the get.
1 Reply
Rick Albert
Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
2y
There is a very high probably that you cannot do STR for this condo. Most condos don't allow it. Plus I doubt the numbers would work with these high HOA dues. Is this $4K per year or per month? Two very different things. Around $300 a month isn't bad, $4K a month is very challenging.
Even mid term rentals you might have problems with the HOA.
The only way it makes sense to wholesale it is if you sell this for a very steep discount. I'm not sure of too many investors who would want this depending on the HOA amount. Flipping condos is tough because with the HOA dues means higher carrying costs. This is likely going to be an owner user who is all about the lifestyle.
This is probably not a deal to be had other than helping out a client who pointing them in the right direction. You can attempt Seller Financing and house hack it. That could be interesting as an equity play. Then in a few years when the Seller Financing is due, sell and take the tax free money elsewhere.
0 Reply
Sarah KensingerPro Member
Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
2y
If you can wholesale the condo to someone that would like to live there, I think that would be the better option.
[email protected]330-557-3021
0 Reply
John Key
Member since 2023 · 39 posts · 18 votes
2y
4k HOA fees per month is crazy...
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.