May 10th, 2011, posted by Brandon
Whenever I have a new listing I always inquire about the investor ratio, and unfortunately a recent listing of mine is coming in high. Anything above 50% investors makes anything less than 20% down extremely difficult. My new listings is likely geared to a 1st time home buyer – and how many 1st time home buyers do you know that have 20% to put down? Not many… The issue at hand is mortgage insurance.
Anything less than 20% down requires mortgage insurance and right now there are few – if any – mortgage insurance companies willing to “insurance” loans for condos with more than 50% investor owned.
If you’re a seller, understand this will impact your value and your marketing time. What’s the impact? Probably about 10% of the value or more, and possibly triple the marketing time.
If you’re a buyer, with at least 20% down payment, you can find a great buy! This situation won’t last forever and so when it changes, you’ll have instant equity.