What Financing Options are Available for Condo Hotels in Las Vegas?

by Bingle Pizarro / The Brooks Team

Types of Condo Hotel Financing

Investors who frequent a bustling city like Las Vegas may consider buying a vacation condo that operates as a hotel, which is most commonly known as a condo-hotel. While owning a condo-hotel unit gives you the opportunity to earn income through participating in short-term nightly rental programs, financing options for this type of property are limited.

Traditional financing like FHA and VA loans are not available and the small number of condo-hotel mortgage programs out there are very costly and difficult to get. 

Cash

As the saying goes, cash is king. If you are looking for a quick close, the most common and hassle-free transaction is with cash. In fact, about 90% of condo-hotel transactions are done with cash. 

However if you don’t have cash on hand or want to leverage your capital, there are alternative financing options available to consider.

Owner Financing

A popular creative financing strategy is owner financing, also known as “owner will carry” meaning that the seller acts as the lender and finances the buyer's purchase. Most owners who offer seller financing request 30% down at 7% interest for a 3 to 5 year carry with a balloon payment. Payments are most commonly interest-only, but there are some buyers who opt for amortized Principal and Interest payments as well.

Private Money

Another condo hotel financing option is borrowing from private money lenders. This leaves room for more flexibility in the negotiation process as opposed to the lending criteria of traditional mortgage lenders. Going this route also opens you up to more inventory options than you have with Owner Financing.

Don't know where to start?

Despite the limitations on traditional financing for condo-hotels, creative funding options are available! If you are in the market for your next investment property, our real estate team in Las Vegas is more than happy to discuss a winning strategy that fits your needs. Call The Brooks Team for a free consultation today at (702) 260-8527.