[BadBarry]

Firstly, apologies in advance for being the 40,000th person to ask this type of question in this forum. I have read a lot of similar posts on this forum over the past few weeks dating back to 2005 but thought it wouldn't hurt (me!) to post the below questions ...

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Hello,
I'm thinking of buying a condo in Las Vegas as an investment for rent.

I'll be in Vegas for a few days in late May 2012 and hope to spend two full days looking at different areas of Vegas and different condos to see what you get for your money and what each area is like.

Specifics
- I'm a foreigner (Australian) so i'll have to consider the 30% rental income tax rate as well as the 30% withholding tax on sale of the property.
- I'll never need to use the property myself, this will always be available for rent.
- Since I live overseas, i'll need to rely on a property manager / realtor to take care of any issues that arise during the rental period and make any repairs if required.
- I'd prefer to buy a condo that is HOA
- I'd prefer to buy a condo that is less than 12yo (2000+) as i expect a newer building to have less need for major maintenance and should be built to better standards.
- I've researched online (Zillow, realtors websites etc) and can see a few options in Summerlin (The Crossings), Centennial Hills and elsewhere in that immediate area. I've also checked Boca Raton and the Manhattan high rise complexes south of the strip and some places along Pirates Cove Rd. These areas seem popular when reviewing other posters answers to "The best areas to live in Las Vegas" although I am not tied to these two places.
- My price range is anything up to $80k and i'd be hoping for $800+ pm in rent.

Questions for you ?
- With my stated budget, I assume I'm pretty much tied to the Condo market. Are there still single family homes built after 2000 within my budget ?
- In my position (being a out of town foreigner) would you even consider a single family home over a condo as i presume the maintenace costs would be higher and therefore more of a headache. On the flipside, I'd expect a single family home to appreciate more when the economy recovers in comparison to a condo.
- Given my two days free in Vegas with a car, which areas would you propose I visit to get an understanding of the area and meet local realtors?
- What's an average HOA monthly fee ? (How longs a piece of string ... I have seen $150 (Pirates Cove Rd) -> $400 (Boca Raton) quoted).
- What's the liklihood of buying a condo that already has a tenant? Like all other landlords i'd prefer to have a tenant in place instead of leaving the condo idle while waiting for a tenant.
- Is now the time to buy? I can quite happily continue to wait and see how the market evolves over the next 6-12 months if you believe either the prices haven't bottomed or the rental market is saturated.

My goal for this trip is to get a better idea of the areas in and around Vegas that I like, what prices the condos are selling for, whether the rental market is bullish or dead and meet some realtors.

Any feedback would be great.
Thanks,
BadBarry

[ScoopLV]

I think you missed the boat on the rental market. The ROI peaked in 2011, and now EVERYBODY is trying to get into that particular game and rents are falling. Run the numbers yourself, though, and decide for yourself.

1) I wouldn't own rental property that wasn't within walking distance. I would never, ever, ever, ever, ever, ever, ever, ever buy rental property abroad. How long is the trip? 18 hours here and 20 hours back? That will get REAL old after awhile. You don't have renters in Australia? Why not invest in your neighborhood? Sure, everyone in Las Vegas wants you to fly here and buy property. (Yes, seriously, we want you to invest in this city.) But do you have any idea what you're getting into?

2) Search this site for "property manager" and read. Good luck finding a property manager that will actually do what you expect a property manager to do. Most of them just cash the rent checks. You are VERY much on your own in this city. And anyone trying to tell you otherwise is probably selling something.

3) There is a frighteningly-large percentage of tenants who will trash your house just because they can. Then what? Fly back here and fix the damage so you can fly back and wait for your condo to get trashed again? Again, search here for various permutations of "tenant ruined trashed destroyed damaged property." You'll see. Search long enough and you can read what tenants have done to my aunt's places. And SHE LIVES HERE SO SHE CAN FIX THE PROBLEMS WHEN THEY HAPPEN.

[BadBarry]

Thanks ScoopLV for the reply.
re. Your questions:
1) The ROI in Australia at the moment for apartments is awful and there is nothing in the $80k range. Also, the $AUD is near its historic high so when we eventually come crashing down from this commodity boom I should also be able to make some money on the foreign exchange rate.
2&3) Yeah, this is a concern. Finding a decent manager will be the key to whether I go ahead and do this.

[ScoopLV]

Originally Posted by BadBarry

2&3) Yeah, this is a concern. Finding a decent manager will be the key to whether I go ahead and do this.

Well, good luck with that.

Unless $80,000 USD isn't a lot of money for you, I'd find another investment. How about a real estate mutual fund? That gets your money converted into USD and has very good professional management. Easy enough to find the top-performing reality funds.

Then you don't have to worry about tenants smashing all the windows and tile, grinding feces into all the carpets and pouring cement down all the drains. Or a property manager who doesn't lift a finger to find you a tenant, so heroin addicts move into your condo and use it as a shooting gallery.

Sure, doing this yourself will net you a slightly better return. IF everything goes well -- you find tenants who pay on time and stay put AND the property manager is ethical and hard working.

Again, good luck with that.

[eventusstultorummagister]

The Bush family is not buying investment property in Vegas, you know where they're buying? In places with water that's where, why? Because water will be more expensive than oil at some point in the not too distant future. Think about it.

[logline]

Boca Raton is well managed, but you pay for it. Besides, all the units seem to be bought up. The inventory went dry a few weeks ago.

[jet757f]

This wouldn't be something you could do on a 2 day visit.

[krelithous]

it would cost him more than it's worth just flying back and forth after the destroy the place if they do. screw that. and what happens if the water heater floods per say the pipes break you will be the first one they call on.

[modhatter]

Wow. A lot of negativity thrown at the poster. I do not think renters as a rule are anything like that. Not when you have a nice property to rent and rent it yourself. I am not sure how good the property manager is in selecting good tenants. I have never gone that route and have had rentals all my life.

I have only once experienced actual damage to a property, and that was in a less desirable unit in what became a low income neighborhood over the years.
Other than that one, I have just had to do a lot of clean up, painting, and carpet replacing. But this eats away at your profits, because the unit isn't being rented while your doing these things.

$800 seems low for a nice condo, but maybe right after you factor in property managers 10%. Condo fees are fairly high, I'd say averaging around $175 on condos. You can buy a condo equivalent in a single story house that doesn't have these high condo fees. Some are about $50 or so. I say condo equivalent as they have no yard. Maybe a 6 or 8 ft. patch of dirt around it.
I have seen some of these pretty cheap. Many have one or two car garages.

I don't know what kind of rental these make, as opposed to regular condo's with big fancy pools and grounds.

[ScoopLV]

Originally Posted by modhatter

Wow. A lot of negativity thrown at the poster.

I don't see anything negative there, AT ALL. What are you seeing that's negative?

My aunt has had five properties trashed in the last ten years. Buzz had a property trashed. Many others here have had properties trashed. Many of them were using a property management service at the time their property was trashed. There are MANY threads about trying to recoup the damage deposit from a reluctant property manager after the rental property has been trashed.

I doubt BadBarry knows how bad it can be here. I also doubt he knows that the people who may trash his condo likely won't spend a minute in jail for doing so. Barry is used to living in a country where everyone has recourse to the law. Not so, here.

So, again, where's the negativity? Advising someone to watch their ass(ets) is not the same as being negative.