Most of us dream of owning a holiday home in our favorite destinations. This could be Hawaii,
Image source: SmartPhotoStock
Spain, Australia or even Africa, as long as it is a place that has captured your heart in terms of scenarios and sites around the home. Owning a vocational home away from home can be advantageous in that, you can rent it out to other people when not using it to earn rental incomes. A second home earns a long term value in the real estate marketplace than the first home, because you can always sell it at a higher price than the initial buying price.
If you are considering buying a second home, there are then a few factors you need and have to consider first as discussed below.
The location of the holiday home is very important, and should be convenient for you. If you have identified a great place you can retreat in Spain, France, Hawaii or any place you fancy in the world, you might have to consider buying the home in a convenient place and close to resorts or beaches. Although homes located next to resorts, historical sites and even beaches are expensive; you will get value for your money, and can also be used for rental purposes if you need some extra income. The closer the home is to tourist destinations, the higher the budget you need to have. Nevertheless, it all depends with your budget to buy the same.
The main aim of buying a holiday house is to get a getaway home where you and your family members can come enjoy and have fun. This may be harder of you strain your pockets buying a more expensive holiday home, leaving you in huge debts in the long run. The cost of buying the second home may be high considering that, you will be needed to deposit some money while making an offer, then closing costs will follow, legal fees to cater for title deeds and documentation, as well as money to furnish the house as you wish it to be. Your budget should accommodate all these, and leave you with enough money to handle bills and other expenses in life.
Leasing or fractional ownership
Leasing a second home is much easier and less costly as opposed to having full ownership of the home. Some real estate agents in the vacation destinations will lease you the home for a specified number of years in which you will be termed as the real owner of the home until the lease time has expired. This can be a good option considering you may not need the house after some years, especially after retiring from old age.
Another way to save up funds used to buy the holiday home can be through fractional ownership, whereby you only pay for a couple of rooms or a piece of the land. Co-owning the property can also be cheaper for you, though you need to look out for someone you can trust to co-own the home, and then dedicate specific times in which one can jet in for a vacation while the other is away.
Although there are many other factors that one should consider when buying second home, these four are the most important.
Thanks for reading. The author has over 20 years experience as a travel consultant