03 Jun Best Vacation Homes and Things to Know About Them
Things To Consider Before Buying Your Vacation Home
Only about six percent of American households own vacation homes so if you are part of that percentage consider yourself lucky. There are several reasons that people buy vacation homes like it was a really good deal, they want to use them as income property, they want a home to stay in when they vacation or they want to use it for their retirement. All of these reasons are great reasons to buy a vacation home but you have to consider some key things before you jump right in and buy one.
Every home requires maintenance and vacation homes are no different. Just like with your primary residence they need to be cleaned, the yard has to be mowed, the gutters need to be cleaned, the siding will need to be power washing, the weeds removed from the driveway, roof repair, plumbing repair, air conditioning repair and the list could go on forever. This all needs to be considered when you are thinking of purchasing a vacation home. If the home is more than a couple hours away from your primary residence then you will have to drive there to perform all the necessary daily, weekly, and monthly upkeep or you could hire someone local to do it for you but either way you decide to go it all has an expense associated with it. You will need these expenses into account when you are working out your budget.
Financing and Taxes
Unless you have millions of dollars in the bank you will have to finance your vacation home and because it’s not your primary residence you’re financing options are a little different. The most popular ways to finance a second home is cash out of equity on your main home or a home equity line of credit on your primary home. Then you will use the money from the cash out or home equity line of credit to purchase the second home. You can do a conventional loan on the second home but since you already have a loan on your primary residence it will be a little harder to obtain a second mortgage. You can only homestead on property so you will not be able to use the homestead exemption on the vacation home. Therefore the taxes will be significantly higher.
Climates and Animals
Depending on where you buy your vacation home you will have to adjust to the climate, conditions and animals. A home in the Rocky Mountains will have different soundings, plants and animals than a house in the Florida Keys. For example, if you buy a cabin in the woods then you will definitely have to protect your home from deer mouse, spiders and snakes but if you had in Florida you would need to be concerned with alligators. Homes in Florida have to screen in their pools to prevent alligators from wandering into their yard and into their pool. Can you imagine waking up in the morning and walking out to your back yard only to find this monster alligator in your pool? In the southern parts of Texas turkeys are wild and it’s common for you to spot a wild turkey on the side of the road or even strolling through your yard.
Some people decide to buy a vacation home and use it as a source of income. Buying a home is a city that draws a lot of tourism opens the door for you to rent it out to vacationers. This is a great way to pay for the home and help with expenses but you have to be careful when renting out the home because the property could get damaged. Renting to families instead of groups of young people is always better and you can even get a property management company to help you screen renters before you let them in your door.