Buying A Condo In Lake Havasu? Read This.

Real Estate

So you are planning on moving to Lake Havasu.  The first thing that you are probably considering (aside from the awesome weather, great boating, restaurants and shops) is what kind of home you are going to buy.  If you are a first time homebuyer or someone who is seeking the convenience of minimal amounts of maintenance, there is a good chance you may have already made up your mind that you would like to purchase a condominium.  The good news is that there are plenty of absolutely stunning condo complexes in Lake Havasu, but you have to understand the rules that apply to condo purchases that have a direct effect on areas like ours.  Because Lake Havasu has a large population of part-time residents and people who own vacation or rental property, condo purchases in our area fall under some specific regulations that may not effect areas that are not so popular as vacation destinations. 

In order to purchase a condo using a traditional or conventional loan or a FHA loan, there are regulations that will decide if the particular property you wish to purchase is eligible for that type of loan under federal regulations.  If it is not eligible, then unfortunately you are either going to have to secure a "portfolio loan" using a smaller, local lending institution or you will have to pay cash.  The regulations that dictate if a property is going to be able to be purchased using a conventional loan type actually have almost nothing to do with you, and have everything to do with your potential neighbors!

Condominium purchases are not allowed to be conventional loans or FHA loans if more than 51% of the units in the complex are not primary residences.  This means that if more than half of the units in the complex are owned by people who are not permanent residents and who have a primary residence somewhere else, then you are not going to be able to take out a traditional mortgage through a large lending institution in order to buy it.  Complexes with more than 30 units are also not allowed to have more than 10% of the units being purchased with federally backed loan money at any one point.  If the complex has less than 30 units, only 20% of them can have FHA loans attached to them.  No single entity is allowed to own more than 10% of the units in a condo complex as well.  These regulations may seem unfair in that you are not able to get a conventional loan for a property that you want to buy based on the other people in the complex, however the rules are in place to make sure that large portions of the complex do not get defaulted upon, which would have a direct effect on the remaining residents who depend on a pooling of condo fees to keep the complex up to a certain standard.

While you may be frustrated by the fact that most condo complexes in Lake Havasu are going to fall under these regulations while other areas which are less tourist driven would not be as effected, there are still numerous options available to you.  It is possible for you to still secure a mortgage using a "portfolio loan" from one of our local lending institutions.  These types of products pool money from private areas in order to lend it directly to people like yourself.  While these are not federally backed, they will generally require that you put at least 20% down in order to minimize the risk to their investors.  Additionally, a cash purchase is always an option as well.

If you are going to have to take out a mortgage in order to purchase your home in Lake Havasu, remember that these regulations only apply to condominiums and not to single family homes.  There are literally thousands of single family homes in the area that can be purchased for prices just as good as any condo and sometimes for even better!  Contact us today to let us know what kind of Lake Havasu real estate you want to buy, and we will work hard to make sure you find your dream home!