I have some new warnings for you before you buy a condo.
Let me say first that the first real estate purchase I ever made was a foreclosure condo in 1978. I still own it and it’s been a very profitable rental property for me over time.
In the ensuing years since 1978, I’ve have bought many investment properties, both condos and houses. However, I would not consider buying a condo today.
In general, the condo market is fraught with a lot of dangers, including problems with people not paying their association dues and the direct impact that a foreclosure can have on every owner in a condo development vs. a single family home neighborhood.
The condo market has high risk right now with potential high reward. Know that you could buy and not be able to sell for a long time. That’s the danger, even if you’re a cash buyer.
If you do buy, know that you’ll have to hold the property for at least 10 years. If you’re an investor, make sure you are allowed to rent the condo out. Most complexes have rentals caps or even outright bans.
One final area of opportunity: Resort condos are having even more financial difficulty than those in cities or suburbs. They’re typically being sold for such great prices that, if you can handle the uncertainty, the opportunity to own in a beach, mountain or lake community could make it worth the risk over the long haul.