Vacation Property: Dream Responsibly
It happens a lot. The dream vacation on the beach, at the lake or on the ski slopes suddenly morphs into a dream of buying a piece of paradise.
A number of people are considering buying a house with vacation in mind, according to the National Association of Realtors. In 2013, 80 percent of investment buyers were motivated to purchase a new property primarily as a family retreat.
If you’re motivated to do the same in your dream getaway area, here are some preparatory steps you can take as you embark on your property search:
- Decide whether you want the place to be primarily for your use or also serve as a rental property.
If you will try to recoup some of the purchase and maintenance costs through renting, the property you purchase should have a broad appeal, include popular amenities and maybe even be professionally managed.
- Speak to your accountant about potential tax advantages or obligations involved with your vacation property.
Second homes and rental properties are subject to specific tax rules, so be sure you know what’s expected and what you can deduct.
- Think about location, location, location.
Yes, it’s a cliche, but no less true for vacation properties than for other real estate. Homes near beaches or mountains tend to attract the greatest number of interested buyers or renters. Check out all four seasons in your targeted area because the atmosphere can change dramatically based on busy or slower seasons. Finally, if you plan to use the place often, consider something within a few-hours drive or flight. Anything much farther tends to discourage frequent visits.
- Consider renting first, then buying.
This will give you time to get to know the development, the area and the turnover rate among your future neighbors. All these factors are crucial to your enjoyment of the place – and its resale potential.
- Find a local RE/MAX agent who knows the area and the second-home market.
Working with an expert who lives and works in or near your targeted community is your best bet. In addition to advising you on each location’s pluses and minuses, your RE/MAX agent can also discuss the property’s rental and resale potential and year-round character – key factors to consider in your property search.