WOODBRIDGE, VA, Jun 13, 2017—Vacation homes can be a wonderful investment for your family, and your future. But if you’re considering buying a second home to use as a vacation spot, there are things you should consider–especially if you plan to rent the home out when you’re not staying in it yourself.
“Like any investment, buying a vacation home can be risky,” says Stacy Magid, Real Estate Professional of Century 21 New Millennium. “Location and current market conditions are extremely important when deciding whether to buy.”
Below are 5 things Magid suggests you ask yourself before you start house shopping.
Will you be able to afford repairs, maintenance, insurance, and utilities? Sure, maybe you can afford the monthly mortgage, but homes are costly investments, so make sure you think through every hidden cost.
What will you do with the property when you’re not in it? Will the house sit empty? Will you share it with family or friends? Will you rent it out on a rental website?
If you plan to rent the home out, will you manage this business yourself or hire someone? If you plan to rent your home for more than 14 days a year, this is considered a business, and profits need to be reported to the IRS. Who will manage the ins and outs of your business?
Can you afford the fees to pay the manager or agent who manages this? If you plan to have someone manage your bookings and clean your home between guests, make sure you can afford to pay them a portion of the rental costs for these services.
What if you are unable to rent your second home? Can your pocketbook withstand the strain of paying the mortgage? Don’t just assume you will have a steady rental business from the get go. It can take months to build up bookings, and rental demand will fluctuate throughout the season.
For information on real estate, please contact Century 21 New Millennium at firstname.lastname@example.org, 17034919570, or Century 21 New Millennium.
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