I live in Las Vegas and have been taking a look at some of the real estate around town. I'm in a great part of LV suburbia now and pay a reasonable monthly nut for my place.

What I don't understand is how some of the high rise buildings near The Strip can work out as a residence or investment, due to the high HOA fees. I won't get into the specifics of buildings, but most of the studio/1BDs are in the 250K range. That's an affordable monthly payment until you find out that the HOA fees are in the $600+ range (higher if you have a bigger place, of course).

One building I've been looking at has a "low" HOA of $525 (north Strip building, studio unit with a Strip view to the south). Another buildings, south Strip, major casino property is pushing $700 with the HOA. These fees, IMO, are just insane. It's approaching some rents that you can find in Las Vegas and you still have to pay your mortgage on top of that. Roughly speaking, for $250k, you're looking at a monthly nut in the $2k range, of which 25% is your HOA alone.

So, what am I missing here? I don't understand how these units make any sense financially with those fees. But obviously, people still live in them. What am I not seeing here???

Logical question.

Assume you buy a $300,000 house, and you are the only occupant.

What is your "monthly nut" AKA "HOA fee with one member in the HOA"?

Stated another way, what do you get for your HOA fee in a condo that you pay for separately in a house?

Having recently done such a search, and settled on buying a condo, here's my list, but depending on where you are looking, YMMV.

Where I bought, here's some of what is included in the HOA fee that I would have had to pay separately in a house:

24-Hour concierge
24-hour security
Roof and exterior cleaning, painting and repairs (the costs are funded as a part of the reserve fund for each specific item that the HOA supplies monthly reserve fund money to out of HOA fees)
Elevator service and maintenance
Pool and pool service and repairs
Jacuzzi and jacuzzi service and repairs
Trash chutes and trash service
Water supply (because it is not separately metered, although electric is)
Natural gas for cooking (also not separately metered)
Modest interior common areas (hallways, carpets, gym, social lounge)
Irrigation of really modest landscaped areas
(add or delete whatever items suit your particular comparison)
Annual window washing
Safety testing of fire and other equipment
Building common area plumbing and electrical
Sewer usage fees

Here is what I would have to pay for in a house that I don't have to pay for in a condo, because it is already included in the HOA fee:

Security alarm service (no need, there is 24 hour concierge and security)
Property management service (if I take an extended trip it's just "lock and go"
Gardener and/or yard maintenance
Exterior maintenance and repairs
Wall maintenance and repairs
(add or delete to suit your situation)

You might think the possibility of a Special Assessment is a feature of a condo and not of a house. But if your house water heater fails (all of them do eventually, even industrial boilers like a hi rise condo has) the condo has a Reserve Fund to absorb most or all of the blow, which condo owners add to every month as a part of the HOA fee. The single family home owner may or may not have built up a reserve fund, but the SFR owner gets to pay for a new water heater anyhow. Or repair a block wall. Or replace a roof.

Put some $$ figures next to whatever makes it onto your list, and that will be a realistic comparison.

But actually, it was the LOCATION that I wanted, I get that location and I am content, because no single family house was going to provide that location.

Some people don't like apartment living, and hi rise condos are pretty much apartments. There was a time I didn't want that. Now I find it has advantages.

PM me if you want to know where it is.

Yes, I understand how the HOA works and all the benefits, so your point is received. But consider this:

• My suburban community charges $40 in HOA fees. Not much in ammenities (no pool) but it is a gated community
• The rule-of-thumb for repairs on a home is to save up 1%/year of your purchase price in a rainy day fund
• So, on a $300k home in suburbia you're looking to save $3k a year or $250/month for future repairs. Maybe you could go higher, but $250 seems reasonable.
• Combine that with my HOA and I'm still at about HALF of what the HOA would be in one of the "lower HOA" high rises

Obviously there is a massive difference in the space available ($300k will buy you plenty of square footage in Las Vegas) and the HOA CCRs are going to be different on the Strip . . . would it be reasonable to expect quiet hours in a Strip high rise? Probably not.

I'd only be interested if it was in Vegas

to me, those fees seem like a scam.

that posters lists seemed like the same thing. maybe he misworded it.

the problem with those fees are that you have very little control over them..... and i don't know exactly how it works, but wouldn't surprise me to see alot of graft in them.

i would like to see an itemization of things that you would pay for without question with a house........ many people do not pay for security, for instance.

the worst thing is that lots of people i know have had to pay big fees outside the HOA............

and don't forget property tax, although i am sure that was in the $2k nut.

for a bachelor or 1 bedroom in vegas, why not just rent?

Well, yes, that's exactly the question here

Rents overall are quite reasonable in Las Vegas and if you're someone that can live in a 500 sq foot Strip high rise then you're someone that can find a very nice, reasonably priced rental in Las Vegas.

So, who is buying the high rises? Who does it actually make financial sense for? That's basically what I'm after with my post since I really can't make it pencil out any other way.

investors that want diversified portfolio. some investors want different exposure in their portfolio. for example, Asian high net worth individual that wants RE exposure to major US markets (for various reason) and want added perks of having a place to visit/stay.

A lot of people that own these ones by the strip (panorama veer mandarin) ect are using them as "second" "primary" homes due to taxes. they just physically have to live there for 6 months throughout the year which is why these buildings always feel empty even though they are condos with owners.

ya hoa's are high but if your living in california half the year and just want something easy to close the door and forget about and never maintain you really cant beat these high rises near the strip. they are super close to the airport which makes them even more desirable for these types of people and are usually scorpion/bug free. try coming back to a sfr in vegas after being out of the state/country for a month and having to deal with critters.

also most of them offer free suv rides to the airport so its pretty sweet knowing you can just plop out of your high rise and be at mccaren in 10 minutes with your own driver.

Someone like Tom Dwan pays the high HOA cause he doesn't want to worry about all the things he might when owning a house. The money doesn''t matter. Or maybe someone who's just getting their money out of china. They don't give a **** they just want a usa residence. I do delivery (not in vegas) and my chinese customers I almost never actually see them. They are just parking their money.

I've left my place in Vegas for 5-6 months at a time, including summer, with zero bug issues.

The HOA fee is a convenience fee. Just make sure it can't increase all of a sudden. Sometimes these scams increase to like $1000 a month and you're left scratching your head.

Veer tower looked intriguing.

I know these fees escalated during 2009 since a lot of properties went into foreclosure and the hoas raised fees to cover the share missing by foreclosed properties. This exacerbated the housing collapse in Vegas as higher hoas puts more stress on owners. I never understood buying property like this seems better to rent this type of property as you get more flexibility less risk and return on these investments is low compared to other investment opportunities. The benefit is the convenience and low maintenance requirement which is rare for real estate.

HOA's provide shared services for the people living in the building/complex - HOA's are usually ran by actual owners, so there's not some third party raking in the money. It doesn't really matter what the HOA is because it's directly impact in the sales price of the unit - lower HOA higher resale, higher HOA lower resale. Clearly people are valuing these services offered otherwise condo values would plummet.

I live in this high rises.

You break even renting it out at best.

Not worth it at all for rental investment.

High barrier HOA fees have two purposes (and two purposes only)

To add enough quality of life gimmicks to the building that the residents get at least some value proposition, and keeping out people who worry about an extra $1300 a month, who are the people that the people in the building don't want to live around...

They are a luxury tax, not a wealth building vehicle.

That may be true in some cities, but that simply doesn't apply in Las Vegas. The majority of these units sit empty a good portion of the year and the rest are rented out by owners that don't care about the building.

Besides, some of these units are not expensive per-se. If you told an agent you want one for $250k, they would have plenty of units to show you in multiple buildings. My question was around the proportion that the HOA represents of that. $250k anywhere else is a very reasonable payment which most people can afford. But in the Vegas high rises, HOA is like an extra 30% and higher.

I have been looking to buy in NYC and the prices seem reasonable to me. There are pretty respectable 1 bedrooms for 700k-1.1M. But then I look at HOA fees and my eyes pop. 2000-4000/month just in HOA fees. Add taxes and utilities, and I really don't get it, either.

I wonder if someone has a very lucrative gig with these HOA fees (property management/etc.) or if these buildings really are that expensive to maintain. Then I wonder who actually buys these places. Incomes in NYC are higher but income taxes and living expenses aside from housing are higher also... Base incomes are not that high, actually.

This place is tiny. 800k with 1700 HOA lol

Yes, those are two pretty good examples of what I mean. I just don't know who this pricing scheme makes financial sense for, I truly don't.

Speaking of Vdara, I did see a listing that I enjoyed and was within my price range. I know that I've been reading too many listings when I thought that their $750 HOA was "reasonable" It's very good compared to most buildings in the area, but still awful of course.

I am currently working as a HOA community manager in Canada.
We call them Strata Mangers here. The biggest expense for a lot of properties here is Insurance. One of the buildings that I manage has 60 units, and a 900k annual budget.
I prepare the budget, verify and pay all bills.

Top expenditures

$240,000 24/7 Concierge
$160,000 Utilities (Gas/Electric/Garbage/Recycle/Water/Common Telephone)
$120,000 property insurance
$80,000 HVAC services/ permits, monthly inspections etc
$50,000 Janitorial
$30,000 Elevator Servies, permits, monthly inspections etc.
$26,000 Management Services (my company's fees)
$25,000 Fire monitoring /Monthly inspections etc.

20 more budgeted expenses..

Thanks, this is great info. Are the numbers in CAD or USD?

I was always curious about these as well. Like those panorama towers, aria and those other high rises. I mean security and amentities is pretty much the reason why ppl buy these right?


I thought well its like a luxury hotel where you need to check in etc before you can enter, well that is going to deter any theft pretty much always? Has there been much cases of intruders or burglars attempting to get in these properties or its just too hard due to security?


But when i saw the prices, then i saw how much you had to pay a month, i thought that is almost as much rent or close to it or even more... and you are paying like at least $300,000 extra on top of it.


So basically you can't buy one of these and rent it out full time right? Because if you do that, even the rent you collect and everything... would pay for all the HOA fees and all those fees?


Someone mentioned how buying it and renting it out is breakeven at best. But if you had all the cash to pay for it, whether its $300k or $500k or $800k for the unit, and rent it out all year, wouldn't you make some profit if you could always find a renter? But once someone moves out or going to, its hard to keep it occupied almost always right? I see some of these listings on airbnb though but I assume it would be a hassle with cleaning and things like that? Because if you can airbnb it, well you certainly could make a profit if you could get it occupied say even 1/2 the month?

I live in St. Louis MO (USA). This is a pretty good market (quality / size for your dollar).

And I feel that I really know / value say $500,000. I see random 4 families going for $400...800k. If someone said to me: "here which would you rather have, the 4-family or the $500k?" (lets assume no arbitrage here). It would be an easy choice. The cash ALL DAY LONG.

I am not going to get into the math, but the point is that asset prices are broken because of rates.

Eventually the market will punish mis-priced HOA fees. But you may have to go through a lot of ******s paying $2k / month for a doorman before you see a correction. In other words, quoting JMKeynes here, "markets can remain irrational longer than you can remain solvent."

I listed Canadian Dollars. At the building I mentioned, they had a gym but no pool. Your key fob only lets you into the lobby, the parking garage and off at your own floor/lobby so the building was pretty secure. The biggest security issue i believe is people illegally renting their units out as Air BNB.
Then random renters breaking into vehicles in the parking garage.

There are a lot of negative carry properties like these in high rise buildings in major cities all over US

I am pretty sure i saw in one of his vlogs, tony dunst lives in one of these high rises. So someone like him probably paid everything in cash for it? Or he probably has a mortgage every month for something like this?


So every month, he still going to pay like 1k a month in HOA fees at least? I saw when he did his vlog a while back, his place definitely was one of those high rise places.


I remember Antonio Esfandiari many years ago lived in one of these high rises as well in those poker cribs so to speak. But isn't living in those high rises nice since its secure because its like a luxury hotel? But yea even if you pay for everything up front and don't need to borrow any money, that much is HOA fees where its approaching rent prices or even above it... seems a lot right?


Back then i remember ppl kept talking about panoroma towers and how it was the best. But nowadays with poker no longer as big as it was, where do lot of the poker guys stay at? Seem like most just live a in house all the way in henderson or summerlin like daniel negreanu?


But im sure some guys still are like tony dunst and live in those high rises now? I always found those places pretty luxurious since its like a high end hotel with security but had no idea there was a monthly fee that big even if you bought it.


But like someone else says... you can't possibly buy it and rent it out to make a profit right? Could they be used for airbnb? I seen many of these condos on airbnb a while back but i could imagine how the building wouldn't allow that for security issues since its new ppl renting the unit every so often?


And anyone that lives there now, could you offer your opinion on it? I always thought living in one of those high rises in vegas is really nice if you play poker there. But i heard certain high rises are in horrible neighborhoods like allure that is near circus circus? So ideal location is... vdara, mgm signature?