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October 28th, 2010 1:45 PM by David W. Welch
With all the bad news coming out about the foreclosure crisis, I thought I would share a very positive story from right here in Orlando. I was showing condos to an investor that I have been working with for a while now. He has purchased several townhomes from me over the last year and a half. When he called about looking at some of the lower end condos, I just reminded him that condo financing basically does not exist and may not for some time. He is a cash buyer, but the lack of financing options just means that he should not expect his condos to appreciate any until financing returns. At $25,000 each, he is not too concerned as long as he can get a 10% return on his investment.
Now for the good news. We were looking at one particular condominium in South Orlando, and the grounds and buildings all appeared to be in good repair. They have an on-site management company, so we thought we would stop in and ask a few questions. One of my big concerns is whether they are receiving condo dues from most of the units. This is the really exciting part so read carefully. The manager we spoke with said that just a few years ago they got all the way down to nine (yes 9) dues paying owners out of about 360 units. This is a community on the brink of bankruptcy. In just the last few years about 240 or 2/3's of the units are now occupied and paying dues. They are getting ready to begin three big projects including: repaving, painting the buildings and working on their retention ponds and drainage system. This was a condo conversion back in 2006 and was hit as hard as any community I am familiar with in Orlando. Today they are quickly getting sold and getting back to financial health. They are even dropping their association fee $50/month starting in January.
David Welch Real Estate Optimist, Orlando Real Estate