I fell in love with my last vacation destination. Many people do and conclude that they must absolutely buy a vacation home in that area so that they can recreate those magical experiences.
Purchasing your own piece of paradise is an exciting opportunity, but there are many important factors to consider before taking the plunge. Here’s a checklist of key considerations that will help ensure your and your clients’ success.
What kind of travel are you committing to? The location, ease of access and how often you plan on using it are paramount components in this endeavor. If it’s too far away, then you might not use it as much as you originally thought you would. If your vacation home is one to three or four hours away, you will probably find it convenient to hop in the car for a weekend. If the vacation hope is in Mexico, transportation’s costs may limit how often you can fly away. An alternative would be to fly down for months at a time.
How are you going to use the vacation home? Is it going to be a yearly summer spot for extended family or a romantic weekend getaway? Will you plan to live there permanently after retirement? Will you need three bedrooms or is 500 square feet enough space? Having a clear idea of what you want, who’s going to use the home and the purpose of it will be extremely helpful in the overall process.
To rent or not to rent? Many owners are open to renting their vacation home when possible. If this is appealing to you, do your homework. Tax laws can limit how much you can use the property if you rent it out. Check with professionals so you don’t get in trouble.
How are you going to finance it? Make sure you fully understand the financial implications of owning asecond home. Consult with your certified public accountant and your financial planner. There are different tax rules that apply depending on the breakdown between personal and rental use. Keep in mind that there will be maintenance costs for upkeep and repairs on the home. Create a budget, and be prepared for the expenses.
Because owning a vacation home is more a compulsion than a financial decision, turning the property into a profitable rental tends to be an uphill battle. Before you jump into being a vacation-home landlord, take a good look at how your taxes will be affected. Most people who own second homes would be better served by getting them classified as a mixed-use property for tax purposes and renting them out for only the tax-free 14 nights in a given year.
We are Styl Properties, Inc. here to help homeowners out of any kind of distressed situation and potential homeowners find their dream home. As investors, flippers or rehabbers, whatever you choose to call us, we are in business to make a modest profit on any deal, however we can help homeowners out of just about any situation, no matter what! There are no fees, upfront costs, commissions, or anything else. Just the simple honest truth about your home and how we can help you sell it fast to resolve any situation.
Give us a call today at 402.909.0686 to let us know what YOU need help with!