Condo Investment Advice?

Question

I think I know some of the pluses: lower barrier to entry, popular area to rent, less risk // and minuses: HOA fees/rules, slower appreciation, less reward. What are other pluses and minuses to a first investment being a condo in uptown Mpls?

Any other tips you’d offer a first timer thinking of going this direction? Thanks in advance!

LeAnn Riley · Answer

Hi, Are you asking whether condo investing is a good idea?  I say YES.

Condo:

a) Fix & Flip - smaller than SF to rehab, many just need cosmetics. No roofs, exteriors, etc to fix. A few of my savvy investors have fixed and held as rentals. Cash flow isn't super (because of HOA fees) but is positive - Then when the market climbs, like it is now for Sellers - Sell at a greater profit or hold for equity.

b) One level living - very popular for mature people moving out of the big house to downsize into. Always a market when the location is right. Sold many Edina condos to my downsizing friends.

c) Condo's work if you don't have a large sum for down payment. They can be purchased for a lower amount. Pricing of condos is less than housing and the difference is made up in higher dues for the amenities. So it allows those with less down to get in and just make sure the numbers work and that the assoc allows rentals.

d) Caution is on the association and maintenance. Who is managing, is maintenance up to date or is there a coming assessment.