Some individuals in the U.S. abandoned the dream of a second home during the collapse of the housing market. It was all many could do to keep their current homes afloat. But now that prices are continuing to climb and interest rates are still low, it’s time to again toy with that concept. The following are tips to making the right purchase.
Location is Still Everything
When you began the search for your home, your real estate agent probably guided you on the positive aspects of location, location, location. Now that you’re ready to buy a vacation property, the similar statement holds true. Before you’re ready to put a bid on a place, explore the adjacent neighborhoods and amenities. You may also want your second dwelling to be near the beach or mountains. The distance from your current residence can also play a key role in the amount of time that you’ll spend in a vacation home. If you can travel quickly via car, chances are that your investment will be utilized often. This is especially important if you have children, and you want to keep stress to a minimum when traveling.
Costs Incurred for Purchasing and Maintaining the Property
Mortgage rates can be more costly for vacation homes than your current residence. You may also be required to put a larger down payment on the property if this is your second mortgage. Whether you buy something new or an older vacation property, you need to figure all of the costs that you’ll be incurring to buy and maintain the dwelling. Getting a good plumber provides peace of mind because they are experienced to handle leaks and repairs. You’ll also need to factor in maintenance on outdoor lawn care, appliances and heating and air condition. If your community has amenities, there may be association fees tied to the listing.
Asses the Vacation Home’s Rent Potential
Mountain views and beaches are desirable aesthetics if you’re looking to turn your vacation home into rental property. Before you make your purchase, determine the amount of rent going for your location. You also want to check with the homeowner’s association to ensure that you can rent your dwelling. The area that you choose should also have amenities to support the beautiful aesthetics such as water or mountain views, work out facilities, fireplace, hot tub and pools.
Take Your Time
Deciding that you’d like to take steps into owning a vacation home can be an emotional journey. But you don’t want sentiment to be a leading cause to your purchase. That’s why you want to take your time and do your research first. Whether it’s a special vacation spot that you hold near and dear to your heart or you’ve just came off a week of relaxation and contentment, there are a number of important factors to weigh before you make a purchase. Once you’ve carefully figured the costs, location and rental potential, take some time to sleep on your decision. It can also help to discuss your concerns with your real estate agent or ask the surrounding neighbors about the community where you would like to purchase. Although you don’t want to lose out on a good deal, you want to feel confident in the decision that you’re about to make.
With the upturn in economy and low interest rates, vacation homes are now a more affordable option. With its high return and rental potential, it can also make a great investment for those looking to put their money to work for them. But before you sign contracts, you want to factor in the above considerations when selecting your vacation property.
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