Condomania

[Mr._johngalt]

Read an article (MONEY magazine?) about some folks whose
entire employment is finding, buying, renting and reselling
(flipping) condos. Sounds like something I would have enjoyed
15 or 20 years ago. The article claimed that (nationwide) condos
had way outpaced the average appreciation of SFHs. I forget
the numbers but it was a remarkable difference.

JG

 

[dex]

The condo market is one part of real estate that isn't doing well here in Atlanta.
People who are looking to sell are losiong money or if lucky breaking even.

Take a read of the Sunday New York Times - there is an artile about the housing bubble.

 

[omni550]

Here's the link to the NYT article dex referenced, "Be Warned: Mr. Bubble's Worried Again"


http://www.nytimes.com/2005/08/21/b...tml?ex=1124769600&en=fdab46d59361e037&ei=5070

 

[unclemick]

Hmmm

Condos must go in long cycles - we had an abandoned one burn in New Orleans recently - never made it through the last cycle - either squatters or some who refused to move after condemnation had to be treated for smoke inhalation. Whereas two - on the way to the swamp - near - on water have finally taken down their RE signs after 10-15 yrs - finally sold all the units - ? I guess

 

[Mr._johngalt]

Hmmm

Condos must go in long cycles - we had an abandoned one burn in New Orleans recently - never made it through the last cycle - either squatters or some who refused to move after condemnation had to be treated for smoke inhalation. Whereas two - on the way to the swamp - near - on water have finally taken down their RE signs after 10-15 yrs - finally sold all the units - ? I guess

Location is everything, just like in all real estate.

JG

 

[Mr._johngalt]

Here's the link to the NYT article dex referenced, "Be Warned: Mr. Bubble's Worried Again"


http://www.nytimes.com/2005/08/21/b...tml?ex=1124769600&en=fdab46d59361e037&ei=5070

I read it. My opinion? Everyone has an opinion.

JG

 

[Arif]

Location is everything, just like in all real estate

I think you can still make money in RE. Just like the stock market in 1999-2003 not all stocks tanked with the tech downturn. Didn't WB beat the market those years? Same with real estate.
Prices have appreciated maybe 3-5% per year here in Augusta so I don't expect it to fall 30-40% once the bubble busts. I can honestly say that I haven't been tracking real estate long enough to witness a downturn in condos. What is hot in one area might be frozen in another. For instance, I wouldn't buy a condo here (even with JGs money). But SFHs below market value can be had all day long if you're willing to fix them up and flip or rent.

 

[Nords]

Read an article (MONEY magazine?) about some folks whose
entire employment is finding, buying, renting and reselling (flipping) condos. Sounds like something I would have enjoyed 15 or 20 years ago. The article claimed that (nationwide) condos had way outpaced the average appreciation of SFHs. I forget
the numbers but it was a remarkable difference.

I read it.  My opinion?  Everyone has an opinion.  JG

Including you... let us know if you stumble across the actual article or any facts from it.

 

[wildcat]

Condos IMHO only do well in certain cities. Atlanta is not one of them.

Location is everything, just like in all real estate

JG -

I don't have the experience you do in real estate and most of my opinion is from observation. Seems like there are 2 kinds of real estate. The kind you buy for income and the kind you buy for appreciation. Income properties to me are in the not so nice areas of town but make excellent rentals. Appreciation properties to me are in the nice areas of town but not necessarily the nicest house. Also seem to be the kind you want to buy/hold as your own. So I guess I am saying that location does not matter so much for income properties. Disagree or agree?

 

[cube_rat]

The article claimed that (nationwide) condos
had way outpaced the average appreciation of SFHs. I forget
the numbers but it was a remarkable difference.

JG

We bought our townhouse outside of San Francisco last year and we just had it reappraised at 150K higher than our purchase price!!! No, I don't feel lucky. I feel the current real estate bubble in the bay area is about to deflate. Luckily, we have wiggle room in our equity. We actually made a down payment unlike a lot of these Bay Area buyers with nothing down and horrendous I/O loans.

 

[Mr._johngalt]

Including you... let us know if you stumble across the actual article or any facts from it.

Click on the NYT link in this thread man. That's what I was talking about.
I am pretty sure it was the latest issue of MONEY with the big condo
investment article. If you want more info, look it up. Should be easy to find.

JG

 

[tryan]

Having owned and rented out a few condos in my days, I've noted a couple unique issues:

1. Neighbor condo owners dislike rentors and - therefore - associated owners.
2. Condo fees always seem high relative to the service received.

The neighbor problem is escalated because people basically live on top of each other (unlike SFH).

The condo fee problem has to do with pleasing everyone at a professionals fee. Ruling by committee is always hard (and expensive).

 

[P.S.]

Condos IMHO only do well in certain cities.  Atlanta is not one of them.


JG -

I don't have the experience you do in real estate and most of my opinion is from observation.  Seems like there are 2 kinds of real estate.  The kind you buy for income and the kind you buy for appreciation.  Income properties to me are in the not so nice areas of town but make excellent rentals.  Appreciation properties to me are in the nice areas of town but not necessarily the nicest house.  Also seem to be the kind you want to buy/hold as your own.  So I guess I am saying that location does not matter so much for income properties.  Disagree or agree?       

Well I'm not JG, but I've had/have/having personal experience in condos...Would have to disagree with you Wildcat. Purchased in the high rent/nice areas of town. This is what I've concluded: buy in the nicest area that you can afford, with as most leverage as you feel comfortable with. Over time that's how you'll make the most money, looking back. For me, I don't like any debt, so that limits my options. On the other hand, if the market where the units are tanks, I really can sit for a long time to wait out an eventual (assuming) rise. Maybe it's because I'm female, and when I started- single, so nice area of town is alot easier/more comfortable for many reasons. Having nice condos in really nice areas usually restricts who will apply to rent. And in a big city, especially a place like metropolitan D.C. where people are constantly moving for a variety of reasons, you'll often have a big pool of applicants. Have heard quite a few horror stories from people who own/rent units in less desirable parts of many different cities. Long short, I think location does matter.

 

[tryan]

This looks like the subject article ... enjoy.

http://money.cnn.com/2005/08/17/real_estate/investment_prop/cuckoo_condos_0509/

 

[wildcat]

Well I'm not JG, but I've had/have/having personal experience in condos...Would have to disagree with you Wildcat. Purchased in the high rent/nice areas of town. This is what I've concluded: buy in the nicest area that you can afford, with as most leverage as you feel comfortable with. Over time that's how you'll make the most money, looking back. For me, I don't like any debt, so that limits my options. On the other hand, if the market where the units are tanks, I really can sit for a long time to wait out an eventual (assuming) rise. Maybe it's because I'm female, and when I started- single, so nice area of town is alot easier/more comfortable for many reasons. Having nice condos in really nice areas usually restricts who will apply to rent. And in a big city, especially a place like metropolitan D.C. where people are constantly moving for a variety of reasons, you'll often have a big pool of applicants. Have heard quite a few horror stories from people who own/rent units in less desirable parts of many different cities. Long short, I think location does matter.

Good points. I suppose the right answer is a person can make $$ in any kind of real estate. Some choose to do the low end and do well. Some choose the high end and do well. Depends on who you want to cater to. Know a guy who has a duplex in a low end area. Lives out of one side and has only had 2 tenants in 7 years. Has been lucky to have great tenants. Both haven't had a desire to own a house so he keeps rents reasonable and they stick around a long time. Location is pretty crappy.

 

[treypar]

New condo sales in Atlanta are booiming. It is the resales that are suffering for some reason.

 

[Nords]

New condo sales in Atlanta are booiming. It is the resales that are suffering for some reason.

Sounds like too many new condos to me...