Written By Jim McKinley, Contributor for InFluential Magazine
A lot goes into buying a vacation home. Besides figuring out the style and location, you need to consider home maintenance and how to keep insurance costs down. Then there’s the option of buying your second home as an investment property, which brings other aspects to the table. Purchasing a retirement home is exciting, but you want to do it the right way. Here are some things to consider that can help you minimize mistakes and make the right decisions.
Where Should You Live?
When you’re making plans to buy a vacation home, one of the first things to determine is the location. There’s more to it than picking a general area, like the beach or mountains. The key is deciding what you want from the home and making it accessible. For instance, think about the hobbies and activities you want to do and pick a place where you can easily access them.
What Kind of Home Should You Choose?
When choosing what kind of home to buy, think about a place that is suitable for all ages. In other words, pick a house that’s accessible to everyone — from your 7-year-old grandchild to your future 90-year-old self. As Forbes contributor Craig Venezia explains, “Open floor plans, wide doorways and unobstructed exterior entryways work for everyone but won’t inhibit mobility as you age.” While one-story houses are ideal, two-story houses can work as long as there’s a room downstairs that can later be converted into a bedroom.
Who Will Maintain the Home?
Another factor to consider is the maintenance of your second home. Installing an alarm should be the first thing you do. There are also things you can do to prepare for seasonal changes, such as caulking leaks and turning off the water so your pipes don’t freeze. Cleaning the home before you leave is another practical way to ensure that you return to a relaxing place on your next visit. Also, consider installing a coded entry lock on your door so that anyone with the code can enter the house if you’re hundreds of miles away.
Upkeep can increase your property value as well. You should be able to do at least some of the maintenance yourself, but consider hiring a concierge service, property management company, or local cleaners and maintenance workers to take some of the pressure off.
Keeping Insurance Costs Down
When researching insurance policies for your second home, you want to get proper coverage at the lowest price, taking into account that it won’t be occupied year-round (unless you’re renting it out). If you have homeowners insurance on your primary home, check to see if the policy will cover a second home. If you need to purchase a separate policy for your second home, choose one with coverage for any disasters in the area, such as fire, hail storms, hurricanes, floods, and earthquakes. Installing a security system could save you a little money, as well as asking about discounts if you’re bundling the policy with another kind of coverage.
Buying as an Investment Property
Another option is to buy a second home as an investment. It’s generally a good idea to find a low-maintenance home so that you can save money on repairs and put it toward something else. One way to make money is to rent the home out. Because of the internet, you now have more options and control with how you rent out your home than ever before. There’s an active market in most retirement meccas, and you can make great money during the high season.
Keep in mind that if you do decide to rent out your property, you’ll need to make sure it’s fully furnished for tenants, which will be an additional investment. If you’re tight on funds, consider keeping decorative pieces to a minimum and investing in multi-functional furniture pieces; a chaise sofa sectional fits in every shape of living room or den, and doubles as a couch and a bed; a bed with storage underneath will save you the expense of buying a dresser; and a dining room table with benches instead of chairs will save you some money while still providing guests with ample seating at meal times.
When purchasing a vacation home, you want to do what you can to make it an overall enjoyable experience. Taking your age and desires into consideration will help you choose the right location and type of home. Make good decisions about maintenance, insurance policies, and whether to turn it into an investment property, and your second home can turn out to be a true vacation spot instead of a burden.
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