Buying a vacation home is a big decision, and you’ll have to invest a lot both financially and emotionally. Before you jump into such a big decision with big financial implications, make sure you have all the information you’ll need.
Here’s a look at some things you must consider before you think about buying a vacation home.
Financial Considerations
You have to think about financial considerations when you are thinking about a vacation home. How much can you affordably pay down on the property?
Will you be able to pay for property tax, insurance and utilities without compromising your primary residence or the lifestyle that you have become accustomed to?
If you need a mortgage you’re going to have to have a great credit score in order to be able to get the amount you need to secure the property.
Location and Usage
You need to look at the desirability of the location you are selecting. Is it a place that you’re going to enjoy visiting regularly?
A vacation home is a big long-term commitment and you want to make sure it is somewhere that you’re going to love most of the time. Consider its proximity to those amenities that you must have.
For example, you may be one of those people who need to live near a bustling city center. This will make it easier for you to access hospitals, high-quality restaurants and so on. However, if you’re a person who enjoys a more rustic setting then all of this will not be for you.
Maintenance, Management and Storage
A vacation home is going to require regular maintenance especially if the area has some very tough weather conditions at various points throughout the year. Are you able to handle it or are you going to have to outsource these kinds of responsibilities?
You also need to think about security. You may not be at the property for a vast amount of time throughout the year. How do you plan to keep it secure? Who is going to check on it regularly for you?
If your vacation home is in a remote location or has limited storage space you might need to use storage facilities to keep seasonal items such as outdoor furniture, or sports equipment safe. This way you won’t have to travel back and forth with them. You have to think about all these things before you buy your property.
Long-Term Commitment
Think about your future plans and the lifestyle you want over time. Do you think you will still want to vacation in this location in 5, 10 or 20 years?
You have to consider whether or not you can make a long term commitment. Consider your exit strategy for the place as well. Think about the potential for reselling the property at a higher value.
A second property can be a lot of work but it is well worth it if you are up to the task.
For those who are in the market for buying a holiday home there must be a lot to consider and figure out. This was a really eye-opening breakdown of some of those elements.