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FL Condos – The Investor Wave in 2010 That is Making People Money Again!

Florida condos have been looked upon unfavorably in the recent past as being a source of loss for many “investors”. This is what the media, and many people who lost these properties to foreclosure, have spewed all over the internet and news channels and aside from their point of view there is an untold story that many people are missing. The CONDO BOOM in S FL and many other cities in the US…

I’m a Realtor in the S FL area who helps people buy foreclosures and short sales and also list and sells short sale properties for homeowners everyday. I know the market, I know what it is taking to get these places sold, and what it takes to try to scoop one up as an investor. Right now the average time working with buyers for these types of properties has about doubled due to bidding wars with mostly cash buyers…

That’s right, bidding wars and cash buyers. That was something you heard a lot about in 2004-2005, but maybe not so much these days. Well let me explain what’s going on here. With the value of these properties SO LOW compared to where they used to be, and the rental rate for many of the areas widely unchanged, you are seeing a chance for investors to finally see some cash flow from renting these units out, but also a chance for buyers to come into the market again.

The majority of what I’m seeing is investors, or buyers that will live in the homes, but are paying cash. That is largely due to many lenders NOT loaning on these places anymore since they see too high a risk. That in turn makes prices stay lower than they would if they could be financed since investors (or good ones anyway) will not pay retail for a property most of the time.

Until earlier this year many of these condos might qualify for FHA loans and fit FHA’s guidelines, but due to condo complex’s financial hardships this has changed everything. There is also no spot approvals available to qualify new, financially stable condo complexes that were not already approved so this has reduced the number of options buyers have when it comes to FHA approved condos. I’ve outlined similar issues that are effecting these properties here: fha loan requirements as an additional resource…

Right now in many places in Broward county, where I service, you can find short sales and foreclosures that are 2/2 condos in decent complexes that are selling in the $50K-$70K range that used to sell for over $220K just a few years back. That doesn’t make them good investments, but let me give you a look at the numbers. For example:

A 2/2 condo that I buy for $60K cash costs me approx. $300 per month for condo fees and $250 per month in taxes. Let’s add an additional $100 per month for miscellaneous fees or costs. Depending on the complex and area, you can get anywhere from $1000-$1250 per month from a tenant and even Section 8 housing. Assuming we are getting $1050 per month that would NET a profit of $400 per month which is a 8% return on my investment at the end of the year ($400 x 12 months/$60,000). That’s a much better ROI than many other investments these days and thats from ONLY 1 property.

This is what’s really happening in many markets around you (including S FL where I am) and this is also the opportunity many people have been waiting for. I wrote this article because MANY people have no idea this is going on unless their “in the biz”, but now you know….it’s up to you to take action though!

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