New investor looking into Condos.

4 Replies

As a new investor who also doesn't know much about condominiums, I'm looking for some advice on this deal. There are 8 units available out of a total of 100. All foreclosures. Most of them are in pretty decent shape, needing some paint (I'm a painter by trade) and some flooring. The worst one needs new doors, a deep clean as it smells horrible, and paint/patching. Six units are 2 bedroom, 1 bath and two are 3 bedroom, 1 bath. Condo fees include the roofs, windows, exterior siding, and snow/lawn care. Landlord is responsible for everything inside (appliances, cabinets, walls, flooring, toilets, furnace, hot water heater, etc.) They're in the lower income part of town but it's not saying much as it's a smaller town with low crime rate. The only PM I'm looking to work with typically charges 10%. I'm hoping she'll go lower if I get these but I want to know if they're even worth it.

Asking price is $46,000 a unit. As they're foreclosures, the bank wants them gone quickly. Would it be wise of me to ask $30,000-$35,000 for each unit if I got all eight? I don't think the numbers work at $46,000 but maybe I'm missing something? 

2 bedroom, 1 bath units rent for $795 a month, condo fees are $245 a month.

3 bedroom, 1 bath units rent for $950 a month, condo fees are $295 a month.


I'm in Alberta, Canada if that helps any.

Check to see the financials on the building to see if there are any major issues with the building that will need to be fixed.

This could be a massive expense x8 units and could easily sink you.

Not uncommon to see that a building is mismanaged and has zero cash to fix the problems.

@Elijah Williamson

I am going to assume that its in a crummy area. D class for sure at that price..

You need to look at vacancy rates also if the condo corp is mismanaging the building..

Might look like a deal on paper but definitely many variables that don't click

Originally posted by @Owen Langis :

Check to see the financials on the building to see if there are any major issues with the building that will need to be fixed.

This could be a massive expense x8 units and could easily sink you.

Not uncommon to see that a building is mismanaged and has zero cash to fix the problems.

 I don't have anything to back this up and I'm not sure how I can but the other "proof" I have is their word that their reserve is healthy. How would I double check this?

@Elijah Williamson it doesn't matter what they say.

Usually, ask for the last 3 years Condo documents and to include current accountant prepared financials and budget.

Once you have all of that info there are companies in Calgary that will review/ analyze the docs for you to ensure that all is good with the property. 

100% worth the investment of a few $$ to ensure what you are purchasing isn't a lemon.

Google "condo doc review company, Calgary" and pick one to use.

They will let you know what docs they want to see to ensure the "health" of the property.