bearishgirl, before a condo purchase and before assuming their expenses, you can just ask the association for their financial statement. They produce an annual report for all the owners, they will give you one, they aren’t allowed to make a profit and they let the owners know where the money goes. While there are many examples, it is not an absolute rule that sfr’s appreciate more than condos. I can cite examples where condos out appreciated sfr’s (and also crashed harder) because they tend to occupy the lower end of the demographic, where there are more people and in a crazy market like san diego, where the average family cannot afford a house, that end of the market gets more play. It’s also not true that sfr’s command more rent, in nominal terms, yes, but in rent to cost or rent multiplier, condos usually win, which is what you look at for rentals. Sfr’s also attract just as many problem tennants, sometimes more, because people with big dogs or lots of animals or people prefer those places, families sharing a place prefer them and people with lots of junk like them. They also require more money after a problem renter, there’s just more to fix including the grounds. I’m not saying one is better than the other, just that you cannot use absolute terms in comparing them. My family experience with rentals over the years has produced mixed results but always has come down to rent multiplier, the lower the number, the better it worked out, with one exception, the senior citizen community sfr has always been a winner. It rarely turns over, they usually stay until they pass on, turnover hits the bottom line with rentals, younger demographics are harder on property and there seems to be and endless supply of senior citizens. It doesn’t appreciate like the more hip condos but it stays rented, it was cheap and it’s been paid off for years, my dad has never uttered a complaint about that one. I thought about buying one but it lacks flexibility, if life serves up a curveball you can’t live in it unless you are old enough and you can’t allow a relative to stay in it unless they are. That has kept me from looking at them for my first solo rental investment.
