With mortgage rates near historic lows and home prices becoming more affordable, now might be the perfect time to consider purchasing a vacation home. A vacation home not only offers comfort and convenience, it also acts as a financial investment for homeowners.
Of course, it’s important to plan out your decision before scooping up a second property. By taking the most important aspects into account, you can ensure that your vacation home will offer fun and security for you and your family for years to come.
When it comes to vacation homes, location is one of the most important features to decide on. How close do you want the vacation home to your primary residence? Should it be in a more urban or rural locale? What areas do you visit most often?
It’s also important to take the local housing market into account. Some properties may be a steal if the market they’re located in is going through a downturn. Then again, other properties may cost more than your original home if the market is surging.
Many vacation properties are located in high tourist areas. This can be a good thing, offering a robust local economy fueled by shops, restaurants and various entertainment venues. However, this can also result in a more expensive stay whenever you visit. Keep this in mind when choosing a location.
Buying a vacation home can be much less stressful than buying your primary residence. If you have the money to purchase a second property, you most likely have the money to rent it. Try giving a possible vacation a test drive by renting it out first. This could be more expensive over time than buying the property outright, but it’s important to make sure you’re satisfied with the home before finalizing the deal.
Also keep in mind that buying a vacation home requires the same kind of maintenance as a primary home. Repairs and renovations will cost just as much, as will any bills associated with electricity, water, gas and other utility services. In addition, stocking your vacation home with food and other necessities are costs you’ll need to account for.
Finally, if your vacation home won’t be open year round, you’ll need to plan on opening and closing the property each year. This can involve deep cleaning and other activities could result in extra costs.
Another vital aspect of buying a vacation home is figuring out exactly how it will be used. Will it strictly be a vacation spot for you and your family? If so, how often will you be visiting, and for how long?
Is it mostly being used as a financial asset you expect to increase in value over time? This can affect what kinds of repairs and renovations you make, as well as where you decide to buy.
Are you open to renting the property out when you’re not using it? By converting your vacation home into a part-time rental, you can add extra income to your investment. If your property is in a high tourist area renting it out can be even more profitable. In addition, if you rent out your vacation home for long periods of time, you can ensure that there is a caretaker present to keep the home maintained and report any problems. They can also act as extra security against burglars and natural disasters.
No matter where you buy your property or how you plan to use it, make sure that the purchase fits your needs. A vacation home should be a positive for you, not a problem.