Flipping/Renting in 55+ Community.

Real Estate Agent · Phoenix, AZ · Member since 2022 · 15 posts · 4 votes

Good morning everyone!

Just wanted to get some insight from investors that have or are currently flipping and/or renting properties in 55+ communities in Arizona. I work with hundreds of investors across the state and a majority stay away from 55+ communities. The obvious con I see is that your target re-sell market is smaller and HOA's can be high with strict regulations. But what are some pros? Why do some investors prefer 55+ communities? Any feedback is greatly appreciated. Thank you.

Happy investing,

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Wendy PattonBusiness Member

Real Estate Consultant · Clarkston, MI · Member since 2009 · 864 posts · 350 votes

i live in one in AZ not far from Sun City and I don't think we have many rentals. AND.... some of the HOAs are particular about selling to too many "llc or investor types". Check out thoroughly what you want to do, but I agree the age limit can be constrictive if things get tight in the economy. Right now it is hard to find rentals in my area. I am 25 min from Sun City in Victory/Verrado Area. (for the winter and MI in the summer)

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Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
3y
Quote from @Jonathan McEntee:

Good morning everyone!
Just wanted to get some insight from investors that have or are currently flipping and/or renting properties in 55+ communities in Arizona. I work with hundreds of investors across the state and a majority stay away from 55+ communities. The obvious con I see is that your target re-sell market is smaller and HOA's can be high with strict regulations. But what are some pros? Why do some investors prefer 55+ communities? Any feedback is greatly appreciated. Thank you.
Happy investing,
Your market for 55+ communities is people who are moving here to get out of a cold climate, not usally people who have lived here for a while. Keep in mind that communities like Sun CIty have a "community maintenance" fee (transfer fee) that has to be paid. I think it's in the $4,500 range.
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Jonathan McEntee
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Real Estate Agent · Phoenix, AZ · Member since 2022 · 15 posts · 4 votes
3y
Ya they usually come with large transfer/capital improvement fees. Just trying to dig in to why some investors prefer to invest in 55+ communities. It's obviously a seasonal thing. More sales happen towards the end of summer, but some investors buy all year long.
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Andy SabischPro Member
Investor · Jackson, MS · Member since 2021 · 660 posts · 561 votes
3y
Speaking from a Florida perspective, there are more negatives than positives. The negatives include the age restriction, the fact that most communities require an application contingency to be part of the sale, the transfer fee and the fact that many have restrictions that dissuade a sale such as no rentals unless you have lived there for a year and vehicle restrictions (no pickups, no motorcycles, etc.). With that said, the properties do sell but the market is focused with a small buyer pool. If it is not near say a beach or other attraction or does not have amenities that "snow birds" find attractive, they tend not to sell and a flip can wind up being a flop. My father lives in one and they have restrictions on when work can be done on a unit which can impact the schedule to flip. There was one that was a renovation that the people found out could not be rented and then lost money on the flip.
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Wendy PattonBusiness Member
Real Estate Consultant · Clarkston, MI · Member since 2009 · 864 posts · 350 votes
3y
i live in one in AZ not far from Sun City and I don't think we have many rentals. AND.... some of the HOAs are particular about selling to too many "llc or investor types". Check out thoroughly what you want to do, but I agree the age limit can be constrictive if things get tight in the economy. Right now it is hard to find rentals in my area. I am 25 min from Sun City in Victory/Verrado Area. (for the winter and MI in the summer)
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