The condotel market is becoming an increasingly popular option for real estate investors in the United States. This type of investment blends the benefits of owning a condominium with the advantages of a luxury hotel, making it an appealing choice for those interested in the vacation rental market.
If you want to meet the needs of your clients looking to dip their toes into the condotel loan market, it’s important to have a good grasp of these investment options and know what cities are currently burning up in the short-term rental market.
What are Condotel Loans?
These alternative financing solutions are used to purchase condotels, which are part condo and part hotel, offering amenities such as 24-hour front desk service, daily housekeeping, and on-site dining.
Owners can use them as vacation homes for a few weeks or months each year and rent them out like hotel rooms the rest of the time. This setup not only provides a personal vacation spot but also a way to earn rental income. Since the hotel operator takes care of things like marketing and maintenance, owning a condotel is less hands-on than other rental properties.
Condotel loans do not adhere to traditional lending criteria because of their unique nature, including the potential earnings from renting them out in the short term. This makes these loans a good fit for investors who want a mix of personal use and investment income from their property.
Miami, Florida
When it comes to property investments, the state of Florida stands out for its vast opportunities. The state’s sunshine, sprawling beaches, and vibrant tourist scene make it an ideal setting for vacation rentals. Cities like Orlando, Tampa, and especially Miami are appealing for their global charm, attractions suitable for families, and lively nightlife. Florida’s well-established market and investor-friendly atmosphere enhance its attractiveness for condotel investments.
Las Vegas, Nevada
Known globally as the entertainment capital, each year, Las Vegas draws millions of tourists, lured by its world-class shows, casinos, and dining experiences. This constant flow of tourists translates into a high demand for short-term rentals, making the city a goldmine for condotel loan opportunities.
Honolulu, Hawaii
Thanks to its picturesque landscapes, cultural heritage, and variety of outdoor activities, Hawaii is gaining recognition as a top destination for tourists and investors. Its famous beaches and events like the Merrie Monarch Festival draw a wide range of visitors. This, along with Hawaii’s stable economy, offers a strong case for the condotel loan market. Hawaii is notable in the vacation rental market for its scenic beauty, cultural offerings, and recreational opportunities.
Austin, Texas
Known for its vibrant music scene, tech-driven economy, and cultural festivals such as SXSW, Austin is fast becoming a sought-after destination for both tourists and investors. The city’s growing population and economic stability make it a charming option for short-term rentals. With its unique blend of entertainment, innovation, and education, Austin represents an emerging hot spot for those looking to invest in that market.
Salt Lake City, Utah
Salt Lake City (SLC) is emerging as a prime hotspot for investors since attracting a vibrant mix of young professionals and outdoor adventurers. With its breathtaking mountain views, booming job market, and inclusive culture, SLC offers something for everyone. Its affordability and efficient public transit only add to its appeal, making it an ideal destination for short-term stays.
LendSure’s Condotel Loan Program
At LendSure, our loan program for condotel financing is designed to make the process straightforward for your clients.
Here are the key highlights of our program:
- Industry-leading Bank Statement Program: LendSure will calculate the income for you and provide an extensive, common-sense pre-qual generally within 24 hours
- Loan Options:
- Up to 75% LTV for Purchase Loans
- Up to 70% LTV for R&T Refinances (740 minimum FICO)
- Up to 65% LTV for Cash-Out Refinances (740 minimum FICO)
- Investment Property and Second Home Only
The LendSure Way
It’s simple. We make loans that make sense. We’re not in-the-box lenders. Of course, there are numbers, ratios, and data to consider, but we know that behind every file, there’s an individual with a unique circumstance seeking a loan. We work hard to offer our common-sense take on lending to borrowers seeking funding for the home of their dreams, another addition to their investment property portfolio, or refinancing of a currently-owned property.
Are you ready to benefit from a commonsense approach to lending? Contact us today to learn more about non-QM loans and how partnering with LendSure Mortgage Corp. can help grow your bottom line.
Reference:
“Best Cities In America For Investing in Airbnb.” Extra Space Storage, 25 Mar. 2024. https://www.extraspace.com/blog/moving/buying-selling-renting/best-cities-in-america-for-investing-in-airbnb/
