Why Lease When You’re Able To Buy A Condo?
Rising interest rates historically have slowed condo conversion activity. This slows down the appreciation as well. It's difficult to convince someone to pay $1200 per month on a mortgage for a 1000 sq. ft condo.
Before you invest in one of these units and plan on leasing it, or you intend to purchase one to reside in, you need to know a few things. If you are looking for one place where you will find all the amenities then upper east side condominiums are best for you.
Condo conversions are marketed to the exact same men and women who rent apartments. Thirty to 50% of all condo conversion buyers are investors and speculators. When they proceed to lease their units, They are competing for the very same marketplace as the programmer of this project. Why lease when you're able to buy? Why rent from you either?
Once low-priced mortgages vanish, and rates have been rising recently as you know, condo conversions will end up riskier. When home sales slow, converters might find it harder to market their condos.
After 30-year interest rates reach 7% or 8 percent, Experts state luxury conversions are going to cool. Today, we are at about 6.25%. The good news is condo conversions are the last bastion of truly affordable Housing in many locations.
Condo conversions create more affordable housing in locations when the cost for a single-family home skyrockets like we have seen around the country. A single family home is averaging about $300,000. That's simply not affordable for your typical first-time home buyer.