Hello, I get this question all the time. In condo developments you will most likely always have rental units because many people buy condos to eventually rent them out. Since you have no control of this no matter where you move, simply ask residents about the peacefulness of the building, look carefully at the condition as well. If you are moving into an area like Carroll Gardens the people who rent will be of a higher income level and professionals in order to afford the rent.

Your lawyer plays an important part in this as well because he has to go through the offering plan and financials to determine the stability of the complex and ownership percentage. So do your homework and protect yourself as much as possible.

Rhonda Holt
Weichert Realtors, H.P Greenfield

Hello:

This is a very good question and you have to address this concern extremely cautiously. If you intent to resell in the near future, continue reading!

The investor ratio is a very important concept for prospective condo or co-op unit owners to comprehend. If one buys a condo and lives in it, he/she is considered an OWNER'S OCCUPIED! A condo owner may choose to rent his/her condo. If so he/she now becomes an INVESTOR OWNER! Every condominium tries to have a low investment ratio possible. A prospective buyer will find this ratio when he or she gets the resale package.

Why banks do not like to lend to building with high investor ratios? They believe that renter will likely not be able to maintain the building like owner occupants. If the building has more than 20% investors, some banks will not touch that building and if the building has more than 50% investors, forget it, because most banks will not go there. Therefore, it is better to find buildings with low investor ratios, for resale propose.

Co-ops are very restrictive than condos on owner's ability to rent out a unit. This is simple! It boils down to TAX REASONS! If they have more than 20% renters, they may most likely loose their tax status as PRIMARY RESIDENCE for owners who do occupy occupy the units. Uncle Sam (IRS) has special rules for co-ops. If they decide the building is not a PRIMARY RESIDENSE, the owners will not be able to take their mortgage interest deductions.

If you are a FIRST TIME HOME BUYER, PLEASE DON'T FORGET TO BEGIN THE FINAL COUNT DOWN!

CLICK HERE: http://bit.ly/1t1m7s

Good Luck

Pierre King
917 407-6697

It is always a problem when you purchase a multi family dwelling and risk of rentals

Check HOA restrictions

National Featured Realtor and Consultant, Texas Mortgage Loan Officer, Credit Repair Lecturer
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Lynn911

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Dear New Buyer:

That is a personalized question that only you can answer. As an example, if this condo is the only one that fits your budget and needs right now, it may be worth while. As stated in the previous answers, if you are getting a mortgage, you have to make sure that the development is financeable. Any good mortgage banker will be able to answer that question for you.

Now is a good time to buy as prices are down and interest rates are low, you may not have this opportunity again. 99.999% of the time you are better off owning as opposed to renting, keep that in mind!

If I can be of further assistance let me know. Good luck!

Sincerely,
Mitchell S. Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, inc.
Office: (718) 645-1665
Email: MitchellSFeldman@aol.com

If you are an all-cash buyer you may be able to get a great deal on such an apartment, as bank financing will be very difficult to obtain. However, this may well be the same situation when you want to sell, so your upside may also be limited. Good luck!

Many banks are not funding loans on condos that have an unfavorable rental vs. full time residence ratio. This is currently creating a concern for both HOA's, owners and potential buyers.

Your questionis a wise one....your choice will be even more important.

Good luck

Patrick is correct. Financing may be a problem if the majority of the units are non owner occupied. What time of loan are you looking for?

It can be all depends on the area crime and turnover of renters in the condos.Be sure to really do you homework before buying.

You may have a hard time getting a loan for a condo building that has a lot of rental units in it. Talk to your lender to see if the building qualifies for a loan.