Buying a condo as an investment property in Washington, DC can be profitable in some cases, but there are several potential drawbacks and risks to be aware of:
🧾 1. High Condo Fees
Impact: Condo fees in DC can range from $300 to $1,000+ per month.
Problem: These fees eat into your cash flow and are non-negotiable—even if you rent the unit out or it's vacant.
Assessment Increases: Special assessments for building repairs or upgrades (e.g., roof, elevators, facade) can be sudden and expensive.
🚫 2. Rental Restrictions
HOA Rules: Many condo buildings have limits on how many units can be rented at a time or restrict short-term rentals (Airbnb).
Delays or Denials: If the building hits its rental cap, you might not be allowed to rent your unit—even long term.
💰 3. Resale Value Can Be Less Predictable
Condos in DC appreciate more slowly than single-family homes or rowhouses.
High Turnover Areas: Condos in transient areas (e.g., near universities or government hubs) may face more competition and price volatility.
📉 4. Harder to Finance (for Tenants or Future Buyers)
If the condo building has:
Too many renters
Litigation against the HOA
Low reserves
Poor maintenance
then Fannie Mae/Freddie Mac may not back loans, which can make your property harder to sell or refinance.
🏢 5. Less Control Over Property
You can’t make exterior changes.
HOA rules can change over time—new restrictions, pet bans, parking reassignments, etc.
You’re reliant on the HOA's management for property upkeep, which can impact rental desirability and value.
⚖️ 6. Tenant-Landlord Laws + Condo Governance
DC has strict tenant protection laws, which can make it hard to evict a non-paying tenant.
Combine that with an HOA board that can impose fines or fees for things out of your control, and it creates an extra layer of complexity.
🏠 7. Limited Value-Add Opportunities
With single-family homes or multifamily buildings, you can renovate, finish basements, add bathrooms, etc.
Condos don’t allow much room for adding value beyond cosmetic updates.
Summary:
Condos in DC can be okay investments—especially if you buy under market value in a strong location with low fees. But generally, they offer lower ROI, higher unpredictability, and less control than other asset types. If you're an investor focused on long-term cash flow and value growth, many prefer 2-4 unit buildings, rowhomes, or small multifamily properties in DC instead.
Would you like help analyzing a specific condo deal in DC? I can help run the numbers.