Adding Another Home to the Fold
Adding Another Home to the Fold
We’ve all thought about how nice it would be to own a second home that could be used as a vacation home or retirement location. With that daydream comes the reality that a second home is a luxury that not everyone can afford but for those that seriously consider the prospect, a few financial bits of information can mean the difference between a single home and a vacation home on the coast.
A second home takes a full commitment as the search, purchase and upkeep of a second home can be a time-consuming task. Over that period of time, people that could conceivably see a swift change in fortune should probably shy away from pursuing a second home until finances stabilize.
If you are unfamiliar with the area in which you are looking for a second home, sometimes a long-term rental can be a viable option to familiarize yourself with the area and see if the benefits you were seeking from the area are all that they seemed to be from afar.
Just as you went through a process of deciding how much home you can afford with your first real estate purchase, you must too go through that process for your vacation or retirement property purchase. As always, your past financial record and employment situation play into the kind of financing you can receive, influencing just what kind of property you can look for in your prospective real estate purchase.
For retirement homes, keep in mind that your retirement could be years in the future and the area may change in that time. So too could the attractiveness of your financing option and the benefit of securing your retirement home must weigh against the necessity to lock in a financing mechanism for the real estate.
One option for deferring some of the cost of a retirement property is offering the real estate as a rental property so that the prospective revenue stream can offset the tax and financing fees of the associated property. Many people use this avenue as a way to secure their eventual new home while building equity and seeing a revenue stream at the same time.
Financing benefits and pitfalls aside, using the Internet is a great way to get a feel for the area you are looking at. The vast majority of home buyers does at least some research online for possible real estate purchases. For those looking at a long distance move, this can be an extremely valuable tool for going through a wide variety of homes in a short time and at a great distance.
It is expensive to fly out and run through as many houses as possible in a short stay and any fruitless trips may discourage you about your move. The Internet can take the edge off of the process to ensure that you see real estate properties that are strong candidates for purchase.
So to can your Internet research go into the search for a realtor in the area you are looking at. If you have a local realtor, that person undoubtedly belongs to some kind of national realty organization that offers a directory of realtors nationwide that will accept referrals. Most realtors also maintain web sites of some type for prospective clients and they can provide information on the experience they bring to your real estate transaction.
Buying a home is always a somewhat complicated process, especially when buying real estate far from your current home. As you go through the dream of owning a vacation or retirement home as part of your real estate portfolio, not only must you inspect your own financial ability to do so but you must also inspect the time and effort you are willing to commit to the project. No one ever said the great benefit of owning a second home came easy, so be full prepared to commit completely to achieve your real estate goals.