It has become the dream of many young people to live in a condominium. All over the world, starting families are working on renting or buying a condo unit where they can raise their children. For an investor, this trend has created an opportunity you cannot afford to pass.
Of course, there are different types of investment properties in Centennial, CO,but it is wise to go where the winds blow. That way, the question shifts from whether the investment is worth it to which specific condo type should you invest in? There are different condos that you can consider including the following.
The standard condo is often classified under freehold condominiums. In the freehold investment, the developer of the condo, you, will maintain ownership of the land where the home sits. Since you own the ground, you can transfer ownership of the units to different buyers.
Freehold condominiums work best as row condos, high-rises and low-rises. The standard condo features buildings divided into several units with common features. When a buyer purchases a unit, they buy the ceiling, floor and walls. They own the electrical and plumbing systems, and depending on your agreement, the parking space.
Most arrangements have the outside space as a shared area. The different buyers own it jointly and pay you a monthly fee for maintenance. These common areas include driveways, hallways, recreational facilities and visitor parking spaces.
In a phased condo, the units are developed in stages until the whole project is over. As an investor, you get an opportunity to sell different units individually before the project is done. Going this way allows you to create a cash flow that will help finance your works in progress. The developer can finish the job in 10 years.
Vacant Land Condo
Here, the buyer will be spending money on the promise of a condo. When you are registering the unit, you have the bare piece of land. As an investor, you sell parts of this land as a unit and then finance the building of the unit. You will need to outline restrictions and regulations to govern the kind of structure that is put up.
Common Element Condo
This type of condo does not have units; instead, it has common amenities. The existing pieces of land come attached to an interest rate. The people who buy the parts of land must maintain the shared elements by pooling the necessary money.
If, as an investor, you are not able to sell your land, this is the kind of condo you want to own. In this case, you get to lease your property to a developer. The land can be leased for a minimum period of 40 years. The people who buy the condos do not own them. Rather, they get leasehold interests.
Each type of condo has its own pros and cons. As a real estate investor, you must be willing to invest in knowledge. What kind of condo will be ideal for your project? Furthermore, you must understand what responsibilities each type will heap on you.