One common strategy among real estate investors is that of the Buy and Hold. With this strategy, an investor will purchase a piece of property, and rather than quickly flipping it, will hold onto it. The idea is that, over time, the investment will yield you a larger return than selling it quickly. And while there are some risks to this strategy, and some large capital barriers, it is a pretty popular strategy among big-time investors.

However, just because a strategy is good for investing in homes, does not mean the same applies when it comes to purchasing a condo. Condos come with their own set of risks, but also have some benefits as well. It is important to analyze both of these before deciding if condos are suitable investment for Buy and Hold.

The Case for Buying Condos
First, let's go over why you would choose a condo for your Buy and Hold. For starters, buying a condo is typically cheaper than buying a home. One of the main factors that keep people from investing in real estate is the initial cost, as they are unable to afford purchasing a home for the sake of investing. Condos, however, are cheaper than homes, and therefore are easier to get started with. If you're just starting out, and your initial funds are limited, this may be an attractive option for you.

Secondly, you may have an easier time renting a condo than renting a home. People, especially Millenials, who are looking to rent typically do not look for homes, and prefer apartments and condos. Since it is easier to rent out, it will spend less time unoccupied, and therefore you'll make more money off of it.

Finally, condos typically come with Home Owners' Associations. This is a group of people your property, and those surrounding it. This allows you to remain a little more hands-off, as the HOA will handle things like repairs and maintenance.

The Drawbacks
While Home Owners' Associations will help you to manage the property, they are not always a great thing. The HOA essentially becomes your business partner in these situations, and you have to make sure you'll be working with a good one. A poorly run HOA can lead to more headaches for you, and even hurt your investment. Having to work with a HOA is one reason many investors stay away from condos, as they are just too unpredictable.

For example, let's say you are looking for Chicago condos for sale. After conducting your research, you find a condo in a good area that is in your price range. Before you purchase it, you should speak with the HOA, and some of the neighbors if possible. Find out what the HOA has in store for the future, and if they work with any other landlords. The more information you can gather about the HOA, how it operates, and how it views landlords, the better decision you can make.

Lastly, because of things like HOA fees, and the fact that condos are cheaper than homes, your yield is likely going to be less. If you are looking to turn on a large profit on one sale, then a condo is probably not the way to go.

The Decision Is Up To You
Many investors say they try to stay away from the Buy and Hold when it comes to condos, but that does not mean it doesn't happen. It really comes down to what your goals are, how much you have to invest, and if you can find a good HOA to work with. All condos are different, and whether or not one is suitable for a buy and hold will really depend on the circumstances. What could seem like a good deal can change overnight because of rule changes by the HOA, making this type of investment a little risky.

Before you invest in a condo, make sure you do your research. Know the surrounding area, know the HOA as well as you can, and be picky about whom you rent to. If you can do all of these things, the chances of your Buy and Hold strategy paying off will be much higher.