Condos are actually multiple fully furnished luxury apartments built in hotel high rise towers. Each such hotel tower is located in a vacation resort or a place of much tourist importance. Condos as a concept have many characteristics that set them apart from other forms of real estate. The greatest thing about them is that they serve to be all sorts of things for all sorts of people.
To a resident owner, a condo serves as a second home for him and his entire family to live in in enjoyment and maintenance-free luxury during the annual vacation. The resident owner needs to book the condo months in advance every year for the stay of his entire family in a specific time slot.
The resident owner of a condo also needs to pay the condo hotel developer yearly fees that is not less than a small fortune for its maintenance. Moreover, the resident owner does not have to bother about its management as that is taken care of by the hotel developer. The condo even serves as a valid 1031 exchange replacement property for its owner.
He is also required to reimburse money that the hotel developer spends on advertisements offering the condo as temporary accommodation to tourists' families. This is during the time in a year it is not resided in by its actual owner. A condo also provides the resident owner rental income during the part of the year he and his family do not partake of its rich hospitality.
The above is possible only because the condo hotel developer offers every such condo to tourists and their families as places to stay in temporarily on a lump sum charge at a holiday resort. This part of the condo business is similar to a conventional hotel business, in which a hotel owner offers rooms therein as an accommodation used for temporary stay.
The difference is that in the case of conventional hotel rooms, the fees that hotel owners charge is on a per day basis and that they do not include the charges for eating and other services. In the case of a vacant condo, a touring family or a group of people get to stay in it on a lump sum charge for the entire duration of the stay.
This charge includes all services such as catering, cleaning up, laundry, car parking, transport, and sightseeing. Of course, the charges are much more than that a couple pays on a per diem basis for a conventional hotel room for two people.
However, the charge is much less than that the condo resident owner pays for stay during the peak tourist season. The condo therefore affords convenience more than money to a group of people out on a vacation, although to a small touring family with modest income it is not as affordable as a conventional hotel room is.
To the hotel developer, condos provide a source of commercial income all the year round. He gets income from the resident owner towards its maintenance and advertisement. He also gets steady income from the tourists' stay in condos during the off season. However, a successful condo hotel niche business is not for everyone as it requires considerable experience.