How To Buy A Condotels

A condotel is relatively the same as buying a condominium. A condotel is a hotel, but the rooms are sold to buyers. The owners of the rooms participate in a rental program when they are not using the rooms and share the revenues with the owners of the resort. A condotel is a motel conversion in which the individual units (rooms) of an existing motel are sold to individual buyers, but the motel continues to function as a viable motel. From the buyer's perspective, a condotel is relatively the same as buying a condominium; as a developer, it is considerably more complicated. A condotel is planned.

Condotel units have proven popular among airline employees who make frequent visits, frequent vacationers and parents seeking dorm rooms for their children. Others are out for the potential financial gain. Condotels typically have a registration desk or concierge, as well as daily cleaning services, food and telephone service, and operate as hotels despite the fact that units are owned individually. Condotels may also feature short-term occupancy, although they can serve as long-term residences as well. Condotel or Condo Hotel is a new trend in the hospitality industry. It is generally seen as a good investment.

Condo hotels units are fee simple deeded real estate, and can be bought and sold like other forms of real estate. Because of the lack of resale data available for many of the emerging markets where pre-construction condo hotels can be found, experts heed caution when considering a condo hotel purchase for investment purposes alone. Condotel owners are subject to check in and check out times, just like a traditional hotel. Many hotels will charge owners housekeeping fees during their stays.

You must have the answers to the six primary factors to consider when making a real estate investment-and how each one affects your level of income said Collingz

1. Why you're making the investment. Do you intend to use and enjoy the property? Or, are you only looking at the investment potential? That's important to your initial outlay and your long-(or short-) term returns.

2. What's your tolerance for risk? Learn your Risk Comfort Level, is this investment within those parameters?

3. Your options for financing. Cash or credit. Your answer helps determine your investment.

4. What fits well in your existing portfolio? To be well-balanced, your portfolio should have a range of assets including real estate-and your portfolio should include a range of properties.

5. Your level of experience in the market. Experience is the roughest teacher-because it gives the test before it gives the lesson.

6. Your desired level of involvement. Your level of participation will help you determine your type of investment.

Condotels are also appealing to the 40-60 year old demographic who are in the market for that second home or investment property. Condotels are usually expensive, costing 10% to 40% more than traditional condominiums in most markets. Monthly maintenance costs, to pay your share of the hotel's upkeep, can run as high as $900 for your 600-square-foot unit. Condotel units are generally sold during the pre-construction phase of development. They are often built on prime locations, such as facing a beach or in the heart of a city and often in places where the flow of tourists is really high.