I personally dont know any investors who like condos for rentals, although there may be some. The negative is mainly the association, which has rules and fees. Rules against tenants and things that tenants do. I have managed a condo for a client and it was bad. Always getting calls from the association on what the tenant is doing, and always getting higher fees. Be careful in buying a condo for a rental.
You might want to consider a section 8 property. They can be purchased fairly cheaply and if managed right produce higher income than a more typical rental house. The disadvantage is typically less appreciation, but you asked about cash flow.
I would like to generate a maximum amount of monthly steady cash flow
but not sure how I can do this.
I have looked into low priced condos in the not-so-high-status neighborhoods but afraid of several factors such as 1) will I find a suitable tenant with good credit…
2) having trouble finding a condo that has a small condo fee (most seem to be around $300 ~ $400
please advise some proven ways to maximize my money…
thanks in advance.
Posted by Scott Shubert on July 28, 2003 at 14:05:16:
I would take the 20K and use it for expenses and reserves to buy 20 houses “subject to”. The average profit on those deals would be 30-40K. Or you could try a mutual fund.
This is a frequent question. And I think it is not the right question. The right question is what should Dave Lee do with $20K?. What I would do may not be right for you. I have an investment approach. I could easily take that $20K and put it through my program and start making a profit with it. but, you might not be able to effectively do what I do. Or you might not want to do what I do.
The best advice I have for you right now is to read my post for beginners, if you have not done so yet. It can be found by putting “beginners success” into the search function of this main board of this CREONLINE.COM website.
Good Investing**************Ron Starr*************
Before I spent a nickel, I’d get a copy of my credit report, and make sure my score was 660 or higher, immediately taking action to improve it if it wasn’t.
Then, I’d read as many of the posts and articles on this site as possible for 8-10 weeks.
After that, choose an 1-3 investment fields that appear like they’d work for me.
Invest up to $5000 in educational materials- only on those fields I want to work in (plus a little asset protection/entity structuring/accounting set up).
Then, invest no more than $500/month on marketing- preferably 80% or more of it on simple, low-cost methods.
That leaves you $13,000 for repairs, miscellaneous, and acquisition costs.
Following a plan similar to this should yield several suitable properties in 60 days or less.
I agree with ken, condos can be less than desireable investments because of the condo fees and associations. Even if you find a condo that has low fees, that’s no guarantee that they will remain low. In fact if they’re really low for your area they may indicate that repairs have not been kept current. I would not buy another condo. Every time we get the rent up above break even the condo fee increase eats it up. Luckily the financing is 10-year, so the tenant is paying that down for us, but we have no cashflow in the meantime.
with education I would invest that $20K in mobile home notes, but not if I didn’t have experience buying notes and mobile homes.