While owning a vacation house sounds and can be glamorous, many times it is also a great long-term investment. Reasons for buying a second home vary, from leisure enjoyment to investment interests to retirement anticipation. Though the idea of a weekend getaway house is alluring, first time vacation homeowners should ask a few questions before they jump into buying a second home.
Does the location match-up with your lifestyle?
The first fundamental consideration when buying a vacation home is whether you like the culture of the destination. Visit the location a few times and wander around the area or town. Take time to talk to the locals and ask them what they like (or don’t like) about living there. Also consider the types of activities you want accessible at your vacation destination for years to come. While you might be into hiking nature trails now, will you prefer 18-hole golf courses in retirement? Be sure you really do love the sleepy beach town or busy tourism area before committing to making a home purchase.
Can you afford a vacation home?
Though you won’t live there all the time, a second home requires the same financial considerations as your primary home. The total cost of a second home still includes property taxes, utilities, and maintenance services. Many second home costs considerations vary, such as insurance and travel expenses. If your vacation home is in an area prone to forces of nature (think hurricanes or tornados), insurance for your home can get expensive. Additionally, travel expenses can become extensive depending on how far your vacation home is from your primary residence. Can you drive there in a few hours? Or will you have to take a plane ride?
Who will watch your home?
Since you’re likely to be away from your vacation home for long periods of time, budgeting for a security alarm system can be a wise investment in your home. From busted water pipes to broken windows, frustration can arise when damages occur at your second home when you aren’t nearby. Hiring a property manager will ensure the upkeep and maintenance of your vacation home year-round, especially if you plan to rent it out. Although it is an extra expense in your budget, water damage from a leaky roof will probably cost more later on.
Will you rent it?
Integrating rental possibilities into the financial considerations of your second home buying can pay off. If done correctly, rental income can help offset some overhead costs of the property. Conduct research about nearby rental properties in the area and talk to local agents so you can get a better idea of the rental potential for your home. Additionally, look into the occupancy rates and peak seasons of the destination you’re considering. For example, the peak times for destination rentals in Florida are during winter months, as Northerners travel to get away from the cold. If you plan on personal use overlapping a lot during the rental demand season, renting may not be the best option for you.
While buying a vacation home is an exciting time for you and your family, make sure to consider all of your options for the best results. To find more resources and information about buying a home and living in South Florida, visit the Luxury Estates Plus blog or Facebook and Twitter pages.