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Anyone Ever "Flip" a Condo?

Discussion in 'Other Off Topic Forum' started by Jerrari, Dec 29, 2003.

  1. Jerrari

    Jerrari F1 Veteran

    Jul 24, 2001
    5,458
    Michigan
    Full Name:
    Jerry Wiersma
    I am contemplating buying a 2000 sq. ft. 2 bedroom condo in Florida for around $475,000. Terms are as follows: 10% down, 10% in 6 mo. (to be held by Chicago Title Co.) and the balance when the roof goes on. Completion date tentatively set for end of '05. A buddy of mine bought one 9 months ago for $575,000 (different development) and he says he can now get $850,000. He says I SHOULD be able to make $200,000 on this current project and be able to sell before the roof goes on (thus before the final payment is due). However, re-selling is not even allowed until ALL units are sold by the developer. Anyone have any experience flipping condos? This new project does not allow non-owner rentals, and I have no plans to move there so it would be strictly to re-sell. Thanks for any advise, Jerry.
     
  2. Hubert888

    Hubert888 F1 Veteran
    BANNED

    May 14, 2003
    5,377
    Manhattan & LA
    Full Name:
    Hubert
    Remember, buying real estate is not always guaranteed to generate capital appreciation. It's not guaranteed that you will make $200k in the deal. However, there is a good chance that you will be able to "flip" it for a quick profit once the unit is completed.

    One thing that you may have to look out for is that if you get a mortgage to close the deal, there may be a pre-payment penalty. That is if you refinance or sell the unit within like a year of closing, you will get penalized.

    Also, you have no idea when the sponsor of the project will be able to sell all the units. If you have extra ca$h to put into an investment at the moment, I would say...go for it.

    But remember, you may be stuck with the unit if you can't find a buyer or if at completion, the sponsor is still left with unsold units.
     

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