Real Estate News with Terri Taydus, AHWD, CNA, CRS, GRI

Lately it seems that I have had a lot of buyers interested in purchasing “attached dwellings” (i.e. condos, duplexes – anything with a shared wall) in close proximity to the CU Campus as an investment property.

I feel a little like a broken record when I ask the question “Have you spoke with a lender yet?” Some folks just look at me like I have three heads, others find any number of excuses as to why they have not taken the leap, while some have made the call and have a marginal understanding of what it means to purchase an attached dwelling near downtown Boulder / the CU Campus.

If you are considering purchasing a condo close to CU, get used to hearing the words “owner occupancy.” What is owner occupancy you ask? It is the ratio of owner occupied units vs. rental units within a subdivision. Many lenders will not lend on anything with less than 50% owner occupancy. Some lending institutions require a minimum of 70% owner occupancy! In a town riddled with students who need a place to live this creates a challenge for the potential investor that needs to secure financing to purchase a condo anyplace remotely close to CU, as most subdivisions are well over the 50% tenant occupancy limits.

So what is one to do who would like to take advantage of the student rental market, but cannot afford to purchase a single family home? Talk to your Realtor and talk to a lender. Remember not all lenders offer the same products. Your Realtor may be able to help point you in the direction of a lender that can assist you. Your lender can then gather the necessary information and provide the details.

There may be certain stipulations such as a larger down payment that will apply. When purchasing a condo for investment purposes, there will not be as many options as there are if you are purchasing an owner occupied property. If you are looking to make a purchase for your student, ask about the possibility of purchasing the condo as a second home, or using a FNMA program called “Family Opportunity.”

There are a variety of options that may be available to you. If you have been told that financing is “not available” ask again. Use your Realtor as a resource – you may have more options than you imagined!

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