Also as noted in my other answer to you, if you are looking for a hands off invesment, then you do NOT want to be in the short term rental business. Success in short term rental is directly related to how much effort the owner puts into managing and booking the property.
Based on what you were looking at in Arizona, I would suggest that you would be much better off looking at the long term rental market around the medical city at Lake Nona in Orlando. You can read more about it on my website.
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Just do your homework and remember, there are no guarentee of ROI, just projections of market conditions, growth, area, rental history.
I'd definitely ask them if they are covering the annual club fees.
Like others have said - I'd be extremely suspicious if someone told me there would be no change in property tax from year to year. That sounds to me like someone who does not know what they are talking about.
I've added a link to Regal Palms fees and costs below.
....If your nom de plum didn't give it away, "hydro" did :-)
First thing that springs out at me is a guarantee of the taxes remaining the same. NOBODY can guarantee that the property taxes won't change. Taxes are re-assessed annually on a market value basis and there are no caps for how much the rates can change for non-resident owners We're also beginning to see some municipalities working to increase their millage rate (the actual "percentage" of the home's assessed value that is charged as tax annually).
I agree with other answerers, 5% is a pretty paltry return, but then again, conservative investing is a safe, long term strategy, especially if you want the unit for yourself down the road.
Get a copy of the contract's, etc, and get them to your lawyer for review. Insist on an appraisal as a contingency of purchase so you can determine if $120K is really a fair market value.
Keep in mind, that while you cannot obtain financing to purchase these condos, once you take ownership, you can take out a loan against yours, often up to 60% LTV.
Century 21 Professional Group, Inc.
on site mgmt companies do one thing.... make a lot of money off of your investment it is a win for them and a lose for you. I would steer clear and opt for a better return.
All the best,
> Ken Anderson
> ApexOne Realty