How Many Renters is Too Many?
When looking at the % of owners to renters in a building, at what point is it deemed that there are too many renters, and the value of the units gets affected? The building I’m looking at is about 60% owners.
When looking at the % of owners to renters in a building, at what point is it deemed that there are too many renters, and the value of the units gets affected? The building I’m looking at is about 60% owners.
Thanks all. The mortgage broker’s response last night was that given this is a condo it shouldnt be an issue, and mentioned something about the size of the down payment also being a helping factor (have a headcold so I’m not remembering clearly the details)
I always thought 80% was the rule too… when I lived in a coop we wrote sublet rules so we would always keep 80% as our minimum. good luck.
Fannie Mae and Freddie Mac require condo and coop developments to be 75% owner occupied before they will approve the building for their financing. They can provided a case by case exemption. Being able to finance with Fannie or Freddie conforming mortgages considerably increases the pool of potential purchasers, which should make it quicker to sell at a higher price.
Fannie Mae and Freddie Mac require condo and coop developments to be 75% owner occupied before they will approve the building for their financing. They can provided a case by case exemption. Being able to finance with Fannie or Freddie conforming mortgages considerably increases the pool of potential purchasers, which should make it quicker to sell at a higher price.
We have found that banks are looking at 80% minimum but prefer 85-90%. You get a lower rate and higher appraisals with higher ownership too.
Over 50% is usually the minimum, but there are banks that will do less. Your best bet is to talk to a good mortgage broker who can advise you on this issue. Also the bank will want to know which banks hold the other mortgages as well as the building’s underlying mortgage (for a co-op).
For Chase, their limit is 70%.
Most banks have their limit at 50%.
Personally, I think the more owners, the better… I’d say over 50% is a good ratio. But, I prefer coops to condos- I’ve found owners to be much better neighbors than renters.
the more renters usually the more fun. owners tend to be a tad stick in the muds.
*rob*
Didn’t realize it could be an issue with the mortgage Johnny, thanks for the head’s up, I’ll ask mine. (this is for a condo)