https://www.youtube.com/watch?v=v9YR_jRtksQ&list=WL&index=4

Introduction

Everybody knows that I love single-family homes, but a lot of people ask what about condos, what about townhomes, what about duplexes and triplexes? There are so many different kinds of real estate, and the truth is, they all perform differently. Today, we're going to focus on condos because we have this huge crisis of a housing shortage, and a lot of people are wondering, you know, what single-family is also kind of expensive; it's not very affordable. Maybe it's time for maybe the era of condo investment has begun today. Let's find out.

Why Consider Condos?

One should be sure is, go so, why are we even talking about condos in the first place? Well, it's because we have huge problems in our economy. Check it out: right now, we have persistent inflation, and what it does is it erodes the value of your dollar, which basically means when you buy stuff like real estate, you need more dollars to buy the same thing that you used to get for fewer dollars. On top of that, we have high interest rates; we literally had a decade since 2008 of like free money; it was like 3% loans, 4% loans, and it was that was so amazing, but we got acclimated to it, and so in the last two years when rates came up to like six, seven, and 8%, everyone freaked out. They thought it was the end of the world because that does translate to a much higher mortgage and, fortunately, there's all sorts of forecasting on the rates coming down this year. It has started, but it's really lent a big problem into, well, I wanted a home for my family, I wanted to buy a single-family home, but it just got priced out of my range. On top of that, we have inventory problems; it's like we would like to buy a house, but I'm looking, and I can't see any houses, so should I look to something like condos and townhomes because there's an overage of them. On top of that, it's just bottom-line economic uncertainty; it's like no one really knows what's going to happen; it's an election year, people are really worried, people tend to drag their feet when they can smell fear, and that's totally what's going down. There's a lot of financial futures that are on hold right now that are being ruined because they're losing time, their most valuable asset. As a result, there's a lot of people that are starting to look at condos; they're looking for alternatives, and the idea of a condo is, is hey, I know it's part of a complex just like townhomes, and as a result, people are turning to condos because they're looking for alternatives of how do we achieve a similar dream of owning a home, and if a single-family home feels too expensive, what about condos? A condo is a residential unit on a multi-unit property with joint ownership of land and a communal area; living in a condo can more closely resemble living in an apartment than a single-family home. You're likely going to live in a unit that's surrounded by neighbors, possibly on all sides, and you know everything about them through the walls. Each unit has an owner, and the owners collectively share common areas such as walkways, pools, communal parks, and so it's like with a single-family home, I have the home, I don't share any walls, I have my own land, and here it's like well, I own a part of a building that is really shared with a bunch of other people in the building, and then we just kind of share everything, so condos are like shared life.

Advantages of Condos

There're definitely some advantages to condos; you got a lower purchase price, right? Condos are generally cheaper to buy than other types of real estate, such as single-family homes. According to the National Association of Realtors, the median sales price of a condo was $344,000 in January 2024 versus single-family homes that are creeping up to $440,000. Bottom line, it's about $100,000 less to buy a condo, and when it comes to affordability and some of these higher interest rates, you can see why a lot of people are wondering whether maybe that's the smart move. On top of that, you have attractive amenities; condos often come with amenities like fitness centers, pools, communal parks, and when you take that all into account, it's like, wait a second, like there's something cool about sharing; it's like, there's pickleball courts over there or tennis courts, or you know, we're kind of next to this park, and so it's like, yeah, we kind of communally own everything, but I have all sorts of stuff I wouldn't get on a single-family premise. On top of that, there's just a lot less maintenance; you see, one of the benefits of sharing stuff is we have a shared roof, and if the roof leaks, everyone's going to pitch in to help pay for that roof, and so at the end of the day, it's like, you know what, if my costs go down, not only is it less expensive to own a condo, but especially when it comes to mowing the lawn or or or pool upkeep or things like that, I do have to pay maybe like an HOA, but kind of someone else is doing it all, so it's easier, and I don't have my spouse riding me saying get on your honeydew list, and don't forget that a condo is not something you have to live in; it's something that you can also rent, which means it can be a source of rental income. In spite of all that, though, there are, however, some disadvantages to condos; in fact, 20 years ago when I wrote my thesis on which Real Estate strategy would make the most money, it came in that single-family homes bought below the median in the top markets I could get them to consistently produce an ROI of 25% or higher, and I remember specifically leaning hard on condos and townhomes, duplexes, other forms of real estate, wondering, well, how do they perform in comparison, and if you take a look at a condo, there's definitely some disadvantages that you want to take into account.

1. Number one, you have homeowners association fees, so you do maybe get all those amenities, but at the end of the day, you got to cut a check for them, and so whether you appreciate them, whether you use them or whether you don't, you got to pay for them either way. In some cases, it's kind of like well, I like these amenities; I don't really appreciate those ones, and at the end of the day, I have to pay for everything, even the things that I don't appreciate
2. You also have potential rental restrictions; some condo associations have rules regarding renters, Airbnb, and sometimes they basically say no bueno, like if you don't live here, you can't do that; now I do know some cool workarounds like a lease option, it's like a rent to own where you're like well, they're not really renters; actually, they're going to be buying the property, my contract says as much, so there are ways around it, but those restrictions make it a little bit more difficult, especially if you don't want to sell the home; you just literally want to rent it out; you also have potential for mismanagement because there's multiple parties all together that have to mutually agree on repairs and things that are happening; the finances and property might end up being mismanaged, and this could impact your investment; for example, you pay money towards your HOA, but what if they don't actually use the money to repair the pool when it goes down, and now the property looks bad because you have a pool that nobody can use, and yet they don't have the money to repair it because they want to raise the prices on HOA, and you're like we're not having that, and it's like well, it's kind of hurting you too; you got less privacy, right? I mean, since condos are part of a larger building and complexes, you are going to know your neighbor's life stories;
3. sometimes, there's also financing difficulties; like getting financing for a condo can sometimes actually be harder; mortgage rates tend to be higher for condos compared to single-family homes, and the lender might have other conditions like expecting a certain amount of units in the community to be owner-occupied,
4. but for me, probably the biggest disadvantage is that condos appreciate slower, and for me, that's kind of a deal killer; you see, do you want to buy an asset that goes up this much in time or goes up that much in time, and you know what, it is a tangible difference, so at the end of the day, you've got to take all of that into account.

Single Family vs. Condos: Investment Considerations

Now, for just a moment, I do want you to understand why I invest in single-family versus condos, and at the end of the day, it really does come down to three letters, ROI, return on investment; one simply makes me more money than the other, but I think understanding why and by how much is important.

Check it out; single-family homes currently are in high demand; right now, we're missing 7.2 million single-family homes, and that's going to keep driving the prices of them higher and higher until we eat through all of that needed inventory, which might take a decade; on top of that, single-family homes produce a higher cash flow; they have a lower vacancy rate; they've got more space; they obviously have a lot more privacy than a townhome or a condo, and you've got free freedom to modify the premise; it's like I can do an addition; I can add on it; I can add walls; I can do this with it; I can add my own amenities, especially the ones that I want to have, the ones that I'm going to enjoy, and at the end of the day, there's actually more appreciation for those that own a single-family home; you might be wondering why condos have a higher interest rate, and that's because Banks do actuaries; they look at the numbers, and they know that you're less likely to default on a home if it's a single-family home than if it's a condo, because with a condo, you're just walking out on a lot less if you ever come under financial strife; one of my things to do with single-family homes is to show you that if you just buy one single-family home, even if you're living in it, to not sell it, turn it into an investment property, and if you buy it the right way and earn a minimum of 25% a year on it, just wait 20 years, and you can grow that into $43 million, which is why I think it really matters whether you start with a condo or a single-family home; if there's a way for you to stretch it and pull it together, single-family all the way is going to make you more money than a condo; the reason why that's important is you might be thinking, but Chris, I'm watching this video because I'm just trying to figure out what's a smart purchase for me and my family; is it a condo, is it a single-family, but what I need you to know is, at age 65, in your retirement account, statistically, you're going to have $254,000; statistically, you're going to have more equity in a home, especially if it's a single-family home, as in right now, in 2024, did you know that the average Equity position on a home in this country is $299,000; it's currently across the board more than what people have for retirement, so condo, single-family home, does it matter? Yeah, it actually matters a lot; now, your situation might require some customization, and you might be thinking, well, Chris, actually, I was thinking of a for-ex and living in one of the units, or I was thinking about maybe a townhome; if you have specific questions or you want to know what would Chris do, you have an opportunity to click the link below this video and request a free game plan; all you're going to do is pop in your name and phone number, and a member of my team is going to reach out; now, every member of my team gets trained every week by me to be me, to basically say, if I were you, step by step, do these things, and here's how much money you wind up with when you get to retirement, or you might be like me, saying screw that, I want to retire in 5 years; Chris, what moves do I need to make right now to cause that to happen, because the reality is, there's only a handful of financial choices that are going to determine really where you ultimately end up in life, and if you want to wind up in the best pace possible, then you may want to get some advice from Uncle Chris, your multi-millionaire friend; click the link below, pop in your information, and let me share with you what I would do if I was starting from scratch in your situation with the goal of living my best financial life possible.

Conclusion: New vs. Old Builds

Okay, Chris, you convince me; I'm going to do single-family, but there's new builds and there's old builds, like there's homes from the 50s and then there's like this neighborhood right over here where everything is brand new, like how does that really affect the investment performance? Should I go newer, should I go older, what really makes sense? Well, click right here, watch this video, and I'm going to show you exactly what to do.