There was some good news this fall as the FHA has eased some restrictions burdening the sale of condominium units. FHA financing is quite common for condominium purchasers and previously that type of financing has been tough to get due primarily to a restriction on the ratio of commercial to residential units in the complex. If the complex had more than 25% of the units as ‘rental properties’ or retail space, buyers were unable to get an FHA loan. Now, the percentage has increased to 50% and buyers can more freely purchase condominium units. Other changes include the relaxing of some language on single investors who may own up to 50% of the units, rules on HOA delinquencies, and some language about the liability risk of condo board members. All this information was reported in the Nov/Dec 2012 issue of REALTOR magazine.
What we’ve learned from this is that any limitation on the number of buyers for a certain type of property can seriously hurt the number of sales and sales prices of the effected properties. In this case, condominium sales in resort areas, downtown areas, and mixed use areas were severely depressed when FHA purchasers couldn’t get loans. These changes should really help the condominium market.
For more information call Todd Groth at 720.203.9624 or look us up online at www.GrothProperties.com