First Time Investor - Las Vegas

[Tango68]

I am looking at investing in a condo with 2 other friends in Las Vegas. The property has a long term tenant which is what we want. There are condos fees of $150.00 and a property manager who takes 10% of the rent to look after all the headaches.



I am exploring a $30.000 mortgage (CND) for my investment. Any input? Other options?



Should we put it in one person's name and have a legal document drawn up?



What should we include in the legal document as we are all friends and want to remain friends?



What are the disadvantages of investing in Las Vegas as a Canadian?



Any additional info would be greatly appreciated!



Jenny

 

[Thomas Beyer]

Ensure the condo building has high occupancy by either tenants or owners. Many foreclosed condo projects. Ensure that reserve fund contributions are up to date and that there are no deficiencies in the building. Study condo documents carefully. Consider tax and liability implications of owning it personally. Consider a trust or corporation with limited liabilities. Consider also messy friends and high-users if you share. Allow for graceful exit of one friend or two if two want to continue. Allow for ways to split costs along usage.

 

[Tango68]

Thank you Thomas,



The reserve fund has about $300,000 and the condo is rented by a tenant who has an interest in staying. This eliminates the hassle of looking for tenants, as we are looking at this as a long term investment.



Not sure of the tax implications as of yet but looking for feedback if anyone has experience. We have a retired real estate agent in the family to review the condo documents.



Again, any advice is welcome.



Jenny

 

[Rickson9]

Have you checked the crime stats in the location of your investment? From what I remember, the safe areas were few and far between.

 

[Tango68]

Thanks for the input. The community is a gated community. A friend who owns four in the same community says it is very safe.

 

[Thomas Beyer]

[quote user=Tango68]any advice is welcome.
Read the condo dox incl. minutes of the strata council and look for:

a) deficiencies, or debates about it

b) lawsuits, or debates about it

c) non-payents of condo fees, or debates about it

d) foreclosures against owners, or debates about it

e) bank owned (REO) condos, or debates about it



$300,000 reserve fund is how much per unit ? How old is this building ? Is this sufficient for new pool, new roof, new A/C units ?



How much are you paying for this condo for how many bedrooms for what sq footage how far from strip ?

 

[dplummer]

Talk to a lawyer who specializes in this. David Altro of Altro & Assoc. is one. Jim turned me on to Altro's book Owning U.S. Property the Canadian Way. www.altrolaw.com Worth looking into.



Doug

 

[Tango68]

Thomas,



There are 40 units in the community and they are 8 yrs old. The condo is $88,000, 1200 sq ft, 2 bedroom 18 miles from the strip, and it's a foreclosure.



I will be checking the condo documents/minutes in the next day.



Doug,



Thanks for the info on the book, I'll check it out.



Jenny

 

[Thomas Beyer]

I hope you did your homework. It sounds like a retail, not a foreclosure price. But maybe it is real nice with a fancy pool area. I understand houses can be had for that price or lower. Why a condo for that price ?

 

[Rickson9]

That price does seem a bit high. Probably something in Spring Valley. If it's in Spring Valley, it's going to be difficult to get much rent above $900 a month for a 2 bed 2 bath. Rent will likely be around $750 per month which is somewhat low for the price paid.



Considerations:

- home insurance

- home warranty

- HOA fees

- property tax

- maintenance above and beyond HOA (e.g. pigeons, termites, broken A/C, broken faucet, etc.)

- how will you hold title

- check county assessor to make sure title is in the correct name and property tax bill is sent to the correct address

- get ITIN to file taxes with the IRS or with hold part of the rental income

- property classification as rental



http://69.69.103.31/crimeviewcommunity/



https://www.crimereports.com/

 

[Tango68]

Thank you, this was the info I was looking for so assist in making the decision.

 

[jeffjas]

[quote user=Rickson9]Have you checked the crime stats in the location of your investment? From what I remember, the safe areas were few and far between.

You are basing this on what exactly ? Vegas is no different than any other city in N.A. if you're looking for trouble you'll find it. The master planned communties are immaculately taken care of and other middle class communities are just like any other.



Yeah only a few areas are safe.......Mountains Edge, Lone Mountain, Providence, Summerlin, Henderson (mostly) , Green Valley, Rhodes Ranch, Lake Las Vegas, Silverado Ranch, need more examples ?......Hope you're not trying to say that Phoenix is a safer city......

 

[jeffjas]

You'd be better off getting a SFH, or townhouse better chance for appreciation and greater resale opportunities. Financial Institutions do not borrow money to buyers of condos as readily as SFH and townhouses, due to ongoing legal issues with the complexes.

 

[Rickson9]

Somebody forgot to iron their underwear today.