The international real estate market value is over $11 trillion, and oceanfront condos contribute a lot to that.
Buying an oceanfront condo can be a great investment for anyone that wants to build wealth. However, many people have a hard time determining whether they’re worth the investment when so many other types of investments exist. Without due diligence, you may end up wasting money.
Before making a real estate investment, we’ll outline the pros and cons of buying oceanfront property. If you have a keen interest in buying one, this will help you determine whether it’s the right decision.
So is an oceanfront condo worth the investment? Read on to find out!
Benefits of Buying an Oceanfront Condo
Investing in an oceanfront property can provide you with various benefits. Not only can you earn money from it, but you can also use it personally whenever you’d like.
No matter where you buy an oceanfront condo, here are some of the main benefits you can take advantage of:
High Value
Due to being on the water, oceanfront condos tend to cost a lot. As a result, renters expect to pay much more to live at one than they do other types of properties.
Traditional properties often see large fluctuations in value, especially when the economy is in a recession. However, oceanfront condos have an easier time holding their value because of their exclusivity. With this in mind, you can look into oceanfront condo investments without fear of losing your money.
If you check out a few beach condos for sale, you’ll quickly find out how much they cost. From there, you’ll get a better idea of how much you can charge tenants.
Easy to Rent
Another benefit of oceanfront condos is being able to rent them at any time, especially if a condo is in a year-round warm state. The demand for them increases when people from colder regions seek vacation and warmth.
Aside from being great vacation sports, oceanfront condos are hard to come by. A condo owner can expect to have people line up with questions about their condo shortly after listing it. Even if your condo isn’t in a tourist hotspot, you can make your money back from it.
Temporary Residence
Those that invest in oceanfront property often do so intending to earn passive income from rent. However, beach condos make for excellent temporary homes that you can use if you own another property elsewhere.
Instead of putting together long-term contracts for tenants, you can rent out your condo over shorter periods. For example, tenants can sign 6-month contracts instead of 12-month contracts.
During the time in which no one is renting your property, you can use it as a personal vacation home. The money you earn from other tenants will help you offset the costs of the property, so you won’t have to worry about the time you spend in it.
Drawbacks of Oceanfront Condo Investments
Like any investment, oceanfront condos come with various drawbacks, and understanding them can help you better determine whether they’re right for you.
Fortunately, investing in an oceanfront condo isn’t as risky as other types of investments. If you buy a condo solely to rent it out, then you’ll face a ton of risk. However, those that buy them intending to rent and use them personally will have an easier time.
Large Down Payments
One of the greatest drawbacks of investing in an oceanfront condo is that you may be required to make a large down payment.
If you’ll apply for a loan to purchase the property, the lender will require a down payment to ensure you’re responsible enough to repay them. If you plan on buying a condo with your own cash, you’ll end up saving more money than you would with a loan, but you’ll have to pay more upfront.
Mold Growth
Mold and mildew are also common drawbacks that oceanfront property owners face. Due to the nature of being on the water, humidity can promote mold growth within your property.
While harmless for the most part, mold can cause damage to ceilings, walls, and floors. It can also cause several health problems, which would make your property a dangerous place to live.
You can invest in various types of products to combat mold and mildew, so take your time to research them online. Depending on the area of your real estate investment, you may need to invest more in anti-mold measures.
Property Damage from Tenants
Anyone who invests in real estate to rent out must know that there’s a major risk of property damage from tenants. While you’ll see less of this in an upscale condo that costs a lot, you should always vet potential tenants before agreeing to have them stay at your condo.
Oceanfront condo living is a pleasurable experience, but things can take a turn for the worst if you have one bad guest that decides to run riot.
Consider Investing In an Oceanfront Condo
Now that you know about all the benefits and drawbacks of investing in an oceanfront condo, what’s stopping you from buying one?
Beach condos indeed come with several risks, but the benefits greatly outweigh them. Whether you’re looking for some passive income or a place to stay during winter, start searching for beach condos for sale.
For more real estate advice, check out the rest of our blog. Both property owners and tenants can find a wealth of information.
