What is my realtor's dillemma? If a detached condo is not FHA approved I need to "steer clear"?
My realtor is being insistent that we don't look at certain homes, most recently, 2 in a great neighborhood, location, and price-and these 2 are because they are detached condos and not FHA approved. After speaking with our mortgage guy, it seems we can go and try without FHA, but she says it's a bad investment. How can this be when my research shows the value is going to go up faster than houses in the area in two years, and people who live there seem happy. She says it is because there are more tenants in the area than homeowners. I realize I won't own the land, just the house, but I am losing money waiting and not so much looking for an investment as a home. I need to move and would rather have equity/privacy/space/etc., but at this rate will take an apt if I don't find a house. yes I have been looking, casually for 2-3 years and seriously with a pre-qual for 3 months. Everything I like she has a reason to shoot down then it gets picked up by someone else. Is she right about this complex or what should I do? Also I found that I can try to get it FHA approved, but seems I have to do all the footwork myself and have not been able to locate the phone number of the association as there is no actual building onsite. I need storage ASAP, am expecting a baby, and our current rental is falling apart and I do not want to be responsible for that, or keep paying more than I would with a mortgage. So She will lose out if the denial to help with this is not for a legit reason I am just not yet understanding. Thanks :)
- ?Lv 77 years ago
You NEVER ever buy a condo in a complex that has more tenants that owners in residence.
You will never get it FHA approved.
You have NOT requested copies of the by laws and financial statement of the condo association. Do you realize if their capital improvement account is low on funds and a major renovation is needed you could be hit with a special assessment of 10k or more and that money is due in 10 days or less.
Suggest you listen to your agent and look else where.
- Wizened wizardLv 77 years ago
All of the advice your are getting from other answerers is good. But if you are not happy with the agent you are working with, fire her and get another. Also, renting is always a very good option. Don't believe it when people tell you that you are losing money not owning a house. Houses are insanely expensive over and above the cost of a mortgage. Count on at least 50% more cost to insure, maintain, repair, decorate, and operate a house than an apartment. There is no tax deduction that so big that it will cover these costs. Most people don't recognize it but a rental is the best and most economical option for more people than you expect. If you're able to do financial analysis, you could run the numbers and prove to yourself that even with a reasonable appreciation in house prices, it is nearly impossible to make a house cheaper to own than renting an apartment.
- JonahLv 47 years ago
1- Maybe the realtor thinks you can't get financing for anything besides FHA. They are always obsessed about the financing.
2- If too many condos are non-owner occupied, then the values will go down because many companies won't loan on properties that do not have at least 80% owner occupied for the entire complex.
3- Realtors don't like to do much of anything. They pride themselves on showing two or three houses, filling out 15 pieces of paper and then asking for thousands of dollars. I have always been annoyed by them. In fact, experienced realtors refuse to work with buyers citing, "All Buyers are Liars" and "Listings is the only way to go". Most realtors don't make that much money, but they don't want to spend much time working for it either. It's because in real estate school they are taught you should buy the first one or two properties that come up and if you don't forget it. In reality, an awesome agent might be able to do that, but if we are totally honest here we know most agents sucks as the average real estate wage is like $1,800 per year.
- acermillLv 77 years ago
She is steering you away from a non-FHA approved condo association because, should you need to sell, it will be much more difficult, since FHA will not grant mortgages to anyone looking to buy. As well, NO amount of research can accurately tell you that values will increase in two years.
And if YOU want to take on the work of getting the complex FHA approved, go for it. IT is NOT a simple process, and there is no guarantee that it WILL be approved. The reason for non-FHA approval is based upon the number of tenants vs homeowners who live in that complex. There are too MANY renters vs homeowners.