Whether you are investing in foreclosed condos or buying one as your home, you want to make a smart choice. Some of the foreclosed condos on the market today are betters deals than others. Some will recover and rise in value faster as the housing market strengthens than others. Here are some things to keep in mind besides price when you are looking for a foreclosed condo.
1. Location. Look at the area and the actual building the condo is part of. Because condos are attached to other condos, their value isn’t solely dependent on what the individual unit look likes. If a lot of condos in that development have been foreclosed on and are sitting empty, it will probably take that development longer to rebound in value and desirability than ones where only a few went through foreclosure. You also want to make sure that the neighborhood itself is nice and convenient to shopping, transportation, schools, parks, and other things you want to be near
2. Condition. While most foreclosed condos will need at least some work, you don’t want to have to completely gut one and redo it. It will be hard to recoup your money if you have to put a lot into it. Look for ones that only need some cosmetic touches to look good again.
3. Liens. When you find a property you are interested in, check to see if there are any additional liens against it besides the bank that foreclosed on it. If there are several that need to be paid off, the condo will probably cost you more. Even if there are just one or two, be aware that the closing will probably take longer and be more complicated as it is all worked out.
4. HOA Fees. Most foreclosed condos will be part of a homeowners association (HOA). This association collects monthly dues or fees that go toward the upkeep of public areas in the development. There also will be regulations and rules that need to be followed. Look into those so you are sure that you are okay with them and also add in the HOA fees to your monthly cost for the condo. The amount varies greatly so don’t assume that one condo’s will be similar to another’s down the street that is in a different HOA. Always check to see what the exact amount is.
5. Location in the Building/Development. Because condos are attached, some are in more desirable spots than others. Some may have better views or be farther from the street. Usually an end unit is more popular than one stuck in the middle. For single story condos, some people prefer being in a top condo so they don’t have upstairs neighbors while others want a ground floor unit for better accessibility. While it may not matter much in the price of foreclosed condos, when you sell it later, a better placement can mean more money, so be sure to consider all of that if you are trying to choose between two similar condos at similar prices.
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