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Acquiring A Vacation Home

By Elizabeth R. Elstien

Now is a good time to escape from an especially cold New York winter and buy a vacation home in the warmth of Florida or any other temperate southern coastal state. Wonder how you can do this? Learn these exciting tips to acquiring a vacation home, make the home pay off and start relaxing in this home away from home.

Tips For Purchasing

Whether buying strictly as a family vacation home or an investment property, the two biggest tips to remember are location is always important, even in a vacation home, and the location should be close to a large city (around 100 miles) to keep it desirable to others in future years. Other tips and tricks to purchasing are:

  • Know the area well by spending time there at different season.
  • Avoid remote or hard-to-access properties, as the resale/rental appeal is low.
  • Study the market to see if the property would make a good rental down the line to broaden its use, even if purchasing as a residential property.
  • Hire a knowledgeable vacation property real estate agent to guide the search and purchase.
  • Check with an accountant or real estate attorney about tax advantages if using home as investment, such as visiting with intent to check into condition of home as tax write off.
  • Read the covenants, conditions and restrictions closely if buying into a community, as some require owners live at the home a certain amount of the year or forbid use as rental.

Once the right home is found, consider these uses to maximize the home's potential and help pay for it, too. After all, this is a second home hundreds of miles away from the primary home that will only be used for family fun and relaxation at certain times of the year.

Short-term Rental

People traveling for short-term business purposes, often get company-paid homes and expenses for as long as it takes to get the job done. Others may just need to wait out a home in construction that has gone over the completion date. While this type of tenant is harder to find, they do exist and may find it hard to get a more traditional landlord to rent to them. Marketing to these tenants may be lucrative to bring income in while the home is not in use.

Vacation Rental

These are furnished condominiums or single-family residences that are rented out for family or groups vacations. You could even partner up with a few restaurants or grocery stores to offer deals to vacationers staying in your home or suggest in-house chefs that could make all their meals. Higher-end vacation rentals include groundskeeper, caretaker, housekeeper and cook as part of the deal so the vacation renters can just relax or go sightseeing.

Partner Up

Purchase with one or two buying partners to share the down payment, closing costs, taxes, insurance, maintenance, mortgage, utilities and other expenses. Each owner can then choose the dates to use the property. Those who put in more funds get to use the property more, as decided beforehand. When not in use, owners can opt to use as a vacation or short-term rental. Keep finances straight for this purchase by having a separate bank account with the other owners under a partnership. Decide how title will be taken (e.g. partnership with right of survivorship or no right of survivorship), depending on state title options, before buying so all are in agreement when the right property comes in view.

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