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Does anyone know anything about Condo-tels?
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Posted by tlbb (My Page) on Thu, Oct 22, 09 at 9:29
| I posted this in the Buying and Selling Homes forum without much luck.
Anyone know anything about these? I'm looking for a condo at the Jersey Shore and there are tons of converted motels sold as "Condo-tels". Some have an actual office and a rental pool that you must use and pay a percentage of the rental fee. Some do not. They appear to be run with an Association, have no office or on-site management and no rental pool. Just like a regular condo.
Financing is really hard to get for these "Condo-tels".
What is the difference? Could someone please explain?
Thanks.
tlbb |
Follow-Up Postings:
RE: Does anyone know anything about Condo-tels?
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| never heard of the term until your post on the other board... |
RE: Does anyone know anything about Condo-tels?
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| I saw these once so I am sure my experience is somewhat limited, but I think they call it that because it is like a hotel room moreso than a condo in design and they are rented out to others in a hotel style. The one I looked at, they took 40% or so of the rent for management fees, and it was also a set price for the 'hotel rooms.' I believe they are all furnished similarly, there is maid service, etc...so it isn't as though you can really customize it to your design desires or set a rental price higher or lower than your neighbor. Of course you can use it anytime you want if it is not previously rented or block off time in advance, etc... But that was just the one I looked at. As for why financing is so tough, I have no idea. Maybe banks don't expect them to sell or perform very well...? Just a guess, tho! |
RE: Does anyone know anything about Condo-tels?
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| One of the first questions a banker will ask when you apply for a mortgage is whether the house will be your principal residence. An owner-occupied principal residence is easier to obtain financing for. A condo-tel unit is seen as a second or third residence, so the mortgage is a higher risk. There is likely to be a low percentage of totally owner-occupied full time units (maybe zero), so the building itself is higher risk. It is a high risk unit in a high risk building in the eyes of mortgage holders. In the olden days, a regular condo building had to have a high percentage of owner-occupied units in order for you to get a mortgage to buy one of the units. The fact that it would be your principal residence didn't matter. Mortgages are hard to get now on everything. And non-traditional types of housing are seen as riskier. |
RE: Does anyone know anything about Condo-tels?
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| Maybe this is clearer, anything with short term rentals ... whether there is a rental desk or not, will have a problem getting a mortgage. As graywings said, too much risk in those types of units. Banks don't want to put mortgages on them. A pure condo building, without short term rentals, is mortgageable. Even conversions. |
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