Message from The Timeshare Guru: Here is another post from The Fit Well Traveler. This provides some good information on the various considerations that you should take into account if you are purchasing a vacation home. A big thank you to the Fit Well Traveler for this information! Please support The Fit Well Traveler and take a look at his site!
Looking for the perfect vacation home? You’re not alone. Vacation home sales are on the rise, according to the National Association of Realtors. In 2013, buyers purchased more than 700,000 vacation homes. From family vacation spots to investment properties, it’s important to ensure that you spend your money wisely. There are several questions you can ask yourself to keep yourself on track for finding--and purchasing--the ideal dream home.
Question #1: Can I afford this?
The cost of a vacation home is about more than a price tag; it’s about the value of your time and experiences. If you purchase a vacation home, will your vacation budget mean you have to spend the next several vacations only at this location? If so, is that something you want, or would you prefer to travel to more diverse places?
Next, estimate the amount of time you’ll spend in your second home, and compare that to some of your past vacation expenses. When you tally up the cost of rentals, food, travel and activities, does purchasing a vacation home make economical sense? Many financial planners agree that ideal housing costs, for one or two homes, should stay below about one-third of your annual income.
Question #2: Will I enjoy spending time here?
Take the time to really understand what it will be like to spend time in the area around your potential home. Learn what the city has to offer, and think carefully about whether or not it’s a place where you’d enjoy spending most of your vacation time. Are you looking for quiet, country town to relax on the weekends or a busy, bustling beach to spend the summers? Exploring multiple environments can help you determine the kind of consistent vacation experience you want to commit to.
Consider driving out to areas around the house, too. Are there mountains nearby? Are there bigger cities that might offer more activities? Spending time in your vacation home isn’t just about your immediate surroundings; it can also be about your opportunities for more travel and broader experiences.
Question #3: Can this be an income property?
It’s a vacation home; by its very definition, you won’t be living there all year long, so do you plan to use it as a rental property while you’re away? A good vacation home can be a place for you to unwind when you need, and bring in cash when you don’t. If planned right, the profits of renting can offset the costs of buying. If you think of this vacation home as long-term investment, renting can help you create equity and potentially pay the property off. Look online and ask local realtors how much other rentals in the area go for so you can incorporate those numbers into your budget.
Question #4: How long will it take to get there?
Vacation homes can be a life saver--a getaway from stress, a place to indulge in your favorite hobbies and an atmosphere that reinvigorates your drive for work and life. However, if it takes a long time or is a hassle to get there, you might find yourself utilizing your private oasis less and less. What’s the point of purchasing a place to escape to if the act of escaping is just too complicated? Think about the amount of travel time and expenses you’re willing to go through each time you head to your vacation home. Does this home fall within a 3 or 4 hour drive, or will you need to hop on a plane? The convenience of travel will likely play a big role in your choice of vacation homes.
Owning a vacation home isn’t just a potential investment, it’s also a lifestyle. Finding a balance between purchasing a vacation home you love and a way to make an investment can be a huge boost in your quality of life--if theproperty is easy to manage. Do your research before you buy to really get the most out of the joy and excitement of owning a second home.