How important is owner occupancy rate?

momopi

Well-known member
I had a buyer ask me for owner occupancy rate this week, and said that if the ratio was below 60% it's more difficult to secure a loan.

I know FHA has been fiddling with the rules (it used to be 50%) but was not aware that this is still a major issue today?
 
We?re just buyers ourselves, but we were told by our broker and a couple agents to make sure and ask about owner occupancy before finalizing. They mentioned that it shouldn?t be a big issue in most areas of CA, but it can be in some areas of Irvine due to investors.

Honestly not something we thought about at all when looking at houses, but maybe it is a bigger deal than we thought.
 
For a condo that I purchased in Irvine in the past, the majority of units were investor owned. As a result, not all lenders could fund the loan or charged higher interest rate. My Realtor was knowledgeable about this and helped me find the right lender.


 
So I emailed my HOA property manager and this is what she said:

"...this is typically something typically disclosed during escrow by WelcomeLink, who we use for escrow disclosures; I unfortunately do not have this information to share."

?_?  So I e-mailed WelcomeLink, so response yet.

Would anyone happen to have owner occupancy ratio info for Oak Creek HOA?
 
I don't think any neighborhood in Irvine built in the last 20 years will have a problem with the owner occupancy ratio (50% is rule).  The biggest potential warrantability issue with condos is the litigation condition.
 
The Watermarke condo off Jamboree has over 60% rental occupancy rate so most lender will not want to lend in this project.  I ran across this back in April of this year for my buyer.  If you need help getting loan approval for a condo that is running into occupancy ratio issue, I can help. 

Tony Nguyen  | NMLS#93776
Vision Quest Lending  | 2860 Michelle Drive, Suite 140, Irvine, CA 92606
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If you are buying where FHA financing is prevalent, then yes it could matter when you go to sell the place.  It will limit who is eligible to buy your place.  If most buyers are putting 20% down using conventional financing then it doesn't really matter what the investor owned percentage is. 

Although it would still worry me from a pride of ownership perspective... renters/landlords tend not to take as good of care of their places as owner occupants.  This could have all kinds of effects on the qualify of life in the neighborhood.
 
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