There’s really nothing more fun or exciting than taking a vacation. After all, everyone needs to get away from the office, take your mind off work, and spend time with family.
So just imagine how awesome it would be to own a vacation home! This would provide a place to stay anytime you wanted to get away from town and relax. And yet it’s no secret that buying a vacation getaway tends to be expensive. Fortunately, you’ve come to the right place for help.
This article takes a look at investing in vacation real estate so that you can enjoy weekend getaways any time of year. Keep reading to discover insight into how easy it can be to make your dream a reality.
- Create a Budget
The first step in deciding to invest in a vacation property is to have a realistic picture of what you can afford. That’s why you need to create a budget for buying a second home and stick to it.
This is especially important when finances are already tight. Keep in mind that you should never bite off more than you can chew. What exactly does this mean? Well, buying a timeshare of any other type of vacation real estate can feel extremely exciting, thus you’ll be tempted to take on debt that you really cannot afford.
Take a serious look at your finances, create a strict budget, set a firm limit to the amount you’re willing to spend, and then resist looking at any properties priced outside of your budget amount.
Staying within your budget will help reduce stress. It will also help you enjoy your vacation property more once you start spending time there.
- Buy or Rent
The next question to ask yourself is, should you buy or rent. There are obviously plenty of options out there, and each as its own advantages and disadvantages.
For example, renting provides a ton of flexibility because you’ll be able to sign a lease for perhaps 6 to 12 months at a time, along with a security deposit. This can save you a lot of money. You might have to pay the first and last month’s rent upfront, but at least that’s far less burdensome than a big down payment.
The downside of renting is that you won’t end up with anything to show for your money. As with any rental situation, you don’t own anything once your contract expires. For many people, this is a worthwhile trade for the cost savings, and yet it’s not much of an investment.
Buying a vacation property might be more expensive, but you’ll actually own the property, thus you can turn around and sell it anytime you wish.
Another option is to buy a timeshare. This is an investment that you’ll share as part of a group of fellow investors. For the price of your investment, you’ll have access to the property for a specific number of days each year. The advantage of this type of vacation real estate investment is that you will ultimately pay less than you would for full ownership, and yet you sell your share at any time.
Be sure to talk to a qualified expert in timeshare law.
- What are Your Needs?
Don’t forget to assess your wants and needs before investing in a vacation property. Every family is different, with different preferences and tastes.
Sit down and make a list of everything you’d love to have in a vacation house. This could include the amount of square footage you want, the number of bathrooms, the types of appliances and modern conveniences you want to look for, and well as the amount of parking space you’ll need.
Then compare these needs to the amount of money you will be able to invest. This can help make the decision-making process far easier. It will also help avoid overlooking details that you might consider dealbreakers.
This process is often eye-opening for many potential buyers. Why? Because a lot of people become dazzled by shiny toys rather than focusing on finding the best match for their families and how they intend to use their property.
- Location is Important
As with any type of real estate investment, location is everything.
For starters, the location of the property will impact the price. After all, the price of vacation real estate in Aspen will be far different than the price you’d pay for comparable property in rural Nebraska.
You should also carefully assess properties located near bodies of water. This is because you’ll have a greater chance of dealing with mold and other issues that can be expensive and dangerous to get rid of.
It’s also crucial to take taxes into consideration. Every state and community is different, thus you could end up spending a fortune in property taxes or HOA fees.
- Research the Area
You should also spend some time researching the area where you plan to buy. Check out the restaurants, stores, activities for your kids to get involved in, golf courses. It’s also a good idea to take a look at traffic congestion during the months when you’ll be there the most.
The more you know about the area, the more you’ll be able to determine whether or not it’s a good fit for your family.
- Start Saving for the Down Payment
If you plan to buy, start saving for the down payment sooner rather than later. You can expect to put down at least 20%, so you’d wise to not delay. After all, this could end up being a sizable chunk of cash.
- Resist Getting Emotional
It’s easy to get excited about buying a summer home. And yet it’s important to remain as logical as possible. Make sure that you can afford this investment. This will also help you negotiate a better price once you’ve decided to move forward with the purchase.
Your Complete Guide to Buying a Vacation Home
When you’re ready to invest in real estate, there will be plenty of big decisions to make. Fortunately, these tips will help make the process of buying a vacation home as stress-free as possible.
Keep scrolling to discover more great insider tips on our blog that can improve your lifestyle.