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Have you ever dreamed about buying a vacation home? A place where you can get away to relax yet still feels like home. A place where you can bring your family every summer to start new traditions and hopefully pass on to the next generation. While owning a vacation home is certainly considered a luxury, improvements in the economy and housing market have proven that the vacation home that may have seemed out of reach a few years ago may now be more obtainable.
But, does that mean you should go for it? There are undoubtedly several pros and cons to buying and owning your own vacation home. Let’s take a look.
If and when you do decide to purchase a vacation home, you of course, will have unlimited access to stay as long and as often as you’d like. Not only that but you have the freedom to decorate as you please, leave clothes behind so you don’t have to travel with bulky suitcases and truly give it a homey feeling.
Many people often view vacation homes as not only a place that they themselves can get away and relax but also as an investment opportunity. While some neighborhoods/associations may have certain restrictions on rental properties, there is often an unlimited potential to rent out the house when you’re not using it to assist with the costs.
Owning a vacation home can provide priceless memories and traditions that you and your loved ones will look back on and cherish for years to come. It becomes your home-away-from-home.
While the investment potential can be huge, it can also be very uncertain. There are several factors to consider prior to purchasing a vacation home – your location, access to airports, restaurants and beaches for example – and it’s important that you consult with an experienced real estate agent as well as look over your entire financial plan before making any decisions.
Even if you pay for your vacation home in cash, you still need to account for the annual fees including taxes, HOA fees and maintenance and upkeep fees. Remember – you’ll likely have to hire a professional for even the smallest repairs if you are not nearby and able to handle them yourself so it can add up quickly.
Most importantly, buying a vacation home requires a long-term commitment. Whether you are strictly using it as a vacation spot for you and the family or are interested in the income potential, it is something that you have to plan for long-term and be committed to any highs and lows you may experience.
Buying a vacation home is undeniably a huge financial investment. Be sure to ask yourself the important questions before you decide to take the leap: What is my main purpose/want to purchase a vacation home? What is the maximum monthly budget I can designate to the vacation home – including taxes, maintenance, etc.? How will this affect my retirement? Does this make sense for my financial plan?
A vacation home can provide priceless memories and traditions that you and your family will treasure for years to come but making sure it’s the right decision to avoid financial turmoil might save you from a priceless vacation turned into a never-ending nightmare.