Pros and Cons of Summer Homes
Maximum Exposure Real Estate opines, “Buying a vacation home is great for a
number of reasons. Not only does it serve as a great place to spend time away
from the world, but it also works as an excellent investment for you as well. What
are the pros and cons of summer homes?
Noted financial advisor Dave Ramsey said, “The idea of owning a
second home is tempting. You can buy it near your favorite vacation spot or in
your own city. But the truth is, for a lot of people, the purchase of a second
home is a bad idea. Real
estate is riskier than most people realize—and it’s not just
about the money you tie up in your property.
Pros and Cons of Summer Homes
- A great
place to get down. Returning to the same place time and after time
can be comforting as you become familiar and comfortable with the location. It
allows you the freedom to be yourself and the opportunity to expand long-term
friendships with residents – you can become part of the social fabric.
excellent investment for you. While all assets fluctuate in value in the short
term, vacation properties are more likely to retain their value and appreciate
because they are located in popular areas with a geographically limited supply.
income. If you decide to rent your home, but personally
use the property as well, you’ll need to determine whether you’re eligible to
deduct operating expenses. To determine this, add up the days you rented the
property. If you occupied the property fewer than 10% of the days, you rented
it or for less than two weeks – whichever is greater – you can deduct all of
the operating expenses of the home including interest, utilities, cleaning
fees, lawn maintenance, and management fees.
- There’s the
money. Most people have higher expectations for a property that they
intend to own, rather than to rent. These expectations can translate into high
prices. In popular areas where space is limited, the house may be priced higher
than the cost of your primary home. In addition, new homeowners typically incur
the costs of furnishing the new purchase with everything from furniture to
linen and dishes, costs that can easily exceed 25% to 33% of the purchase price.
- It takes time and hassle. How much time do
you spend on the upkeep of your home? While a second home may not double that
time, it can mean many more hours and headaches than you think. Dave Ramsey
said, “If this is a vacation home that will remain unoccupied most of the time,
just imagine the damage a burst water pipe could cause if it goes undiscovered
for weeks. Your
vacation spot is also an easy target for vandalism and burglary,
so you’ll need a top-notch security system and insurance designed to cover
damages that are more common in vacation homes.
- Same ole, same ole. If you are
paying a significant amount of money each month for a second home, you may feel
that you need to constantly and exclusively visit the property to justify your
investment. How much time do you have for vacations? Do you want to go every
year to the same place?
information about How to Sell Your House Fast.
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