1-4 Unit condo deal?

[John Adamkewitz]

Hey Guy's, I need some experience on this one. I don't know much about owning and renting a condo, except that many owners don't like the hoa's.

Buy and Hold.

8 yr old condo unit, 1 of 10 total in complex. Bank owns 4 units. 3/3/1, 1600 sq ft.

85k purchase, $1150 rent, $3400 taxes, $250 hoa. Tenant would pay all utility's.

Garbage, snow, lawncare and outside maint by hoa.

Financing, 25% down, 30 am, 4.33% apr.

I come up with piti of $665. for 1 unit. I think that I would eventually move into this unit within 4-6 yrs, for a summer home.

Other than appliances, hvac and special assessments, what should My concerns be?

John

[Bill Jacobsen]

I am assuming that this is not a vacation rental but rented month to month or leased. As a condo you are only responsible for inside maintenance and replacement of anything that you provide.

You need to include a vacancy factor. Probably 5% will do. The last thing is management. I pay 10% of rent plus one month's rent tor new client. If the management manages several in the complex you may get cheaper.

I would shoot for a cap rate of 7.33 given your cost of money of 4.33%.

Hope this helps.

Bill