Condo vs. Single-family home: which one can provide you higher rental incomes
Real estate investors are always looking for what will give them the greatest financial return. After all, nobody wants to have losses, especially after the last few years we’ve had. Therefore, the question of a condo or single-family home generates many doubts, precisely because of the many variables involved in the purchase process.
In addition to the initial investments, it is also necessary to take into account several aspects regarding the property itself. For example, the area where the property is located (the value must change according to the region) if you are thinking of reselling or renting, what changes will be necessary in the place.
Although this is not a house for you to live in, if you are thinking of renting, it is interesting that aesthetically, the environment is attractive to your tenant.
To help you choose between a condo or single-family home, we have separated some tips on what you should consider when choosing.
What to consider when making the choice?
Before buying your condo or Single-family home, you need to ask yourself a few questions. Like for example:
How much can you give as the down payment?
Firstly, it is extremely important to keep in mind how much you can put down on this investment. Because there are laws that require a percentage of down payment depending on the property. A condo, for example, that follows the rules asks for a down payment of at least 10% on the loan. One that does not follow these same conditions can ask for up to 25%.
Additionally, this percentage may vary depending on the state where you are considering closing a deal. So seek to inform yourself about the loan conditions before committing.
If you don’t have 25% to put down – and don’t want to open a line of credit either – the best option here is the single-family home. Since many of them only ask for a 10% advance, the value is much more affordable for you. However, you are still responsible for decorating and painting walls, both inside and outside the house.
What are your plans for the property?
Another thing to consider when choosing between a condo or a single-family home is knowing what your main goals are for this property.
It may be that you are looking for a vacation home, in which case a condo is not a very good alternative. Since the regulations for temporary rentals may vary from one complex to the next. Therefore, a single-family home is a better option.
If you’re one of the lucky ones who found a condo with flexible rules regarding temporary rentals, you need to consider how you’re going to compete with hostels and AirBnB’s in the area. That’s because, with attractive prices, they end up winning the preference of tenants.
Therefore, look for condos that offer some differentials such as leisure areas and are well located.
How much maintenance are you willing to do?
When purchasing a property of your own, it is important to know that all maintenance issues are your responsibility.,
And that is one of the great perks of your buying a condo. In it, you are not responsible for taking care of the house, as the community manager is responsible for the maintenance of common areas. In a single-house family, if you are not available to do all the chores, different teams will need to be hired to take care of things like fixing the plumbing or fixing the electrical cables.
To organize everything before deciding between the two options. Think of the two possibilities: can you invest in specialized people to take care of each area of the house? Or are you willing/have the time/know how to do everything on your own? Depending on the answer, this will greatly influence your choice between a condo or a single-family home.
Condo vs. single-family: choose the best for you
It is a very difficult decision to make. Both the condo and the single-family home offer their advantages. While condos appear to be easier to manage in terms of place maintenance, the single-family home offers easier paperwork and freedom to rent. On the other hand, they give a little more work when it comes to maintenance.
Therefore, before investing, study each of the available options very well and assess your situation.
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