Are condos a good investment?
Usually condos are like L.I.F.O (last in, first out). What that means is that they are the last ones to go up in a boom, as sfh get too expensive. However, when the market collapses, they are the first to go down, Right now condo inventory is low. However, as building has ratcheted up, it’s not condos- its apartments. Condos are not being built.
However, the largest age group in the U.S. is currently 20 to 24 year olds, the group currently driving the rental market. Over the next 5 to 10 years they are likely to become first-time homebuyers, and turn that demand toward newly built condos.
New condos are being built at roughly 10 percent of the pace during the late 1970s and early 1980s at that time baby boomers were in their early 20s and roughly the same size population as the current age cohort of 20- to 24-year-olds. So the lack of new condo production, combined with large demographic demand on the horizon, provides the market with a large opportunity to expand new condo sales over the next decade.