Buying a vacation home is an aspiration of many real estate buyers. This is often when they are becoming financially secure and looking for an investment opportunity offering a period of personal use, or even starting retirement planning.
Or it may be that they are just looking for a place for an annual retreat from the hectic pace of business life. In any event, a vacation home type of purchase is usually a combination of investment tied with personal life ambitions and desires.
Nowadays, with the many schemes introduced by developers who tie-up with branded hotel chains, for example, such vacation homes may be located almost anywhere in the country—or even overseas.
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Aspiring to Buy a Vacation Home? 5 Key Things to Consider
Vacation home markets have distinctive response patterns to economic adjustments or market corrections, as well as values and other attributes, so here are five key things to consider when deciding to acquire a vacation home:
Establishment of market value
The market value of any property is the amount agreed between a willing buyer and seller and is usually supported by evidence of other sales of similar properties achieved by a realtor near you. However, the demand for and supply of vacation homes make the establishment of market value for them a different dynamic
Partly as the vacation home product itself may vary greatly from a cabin in the ski fields or mountains to a beachfront condo which is acquired outright or on a long lease or partial ownership basis. But the value of vacation homes is also partially driven by emotion and sentiment, where buyers are following their dreams!
Vacation homes are often located in areas of outstanding beauty (mountainside or beachside for example) and/or may be part of an integrated complex that offers accommodation as well as a mix of recreational activities and amenities.
There are many different types of real estate products and ownership levels which can usually best be explained by a local real estate agent you find through Upnest. These range from permanent occupancy to part-time, and from timeshares and partial ownership to turnkey options or single-family homes on large plots; in short, something for everyone.
Given the relatively limited supply and high demand in most resort destinations, property values will typically be well above the average. A look through of Upnest buyer reviews will find you a preferred local realtor to help answer any questions about the value in your desired location(s).
Many resort areas, because of their primary attractions, may be extremely busy in the high season(s), yet off-season the weather may not be conducive to comfortable living.
Furthermore, due to transportation methods to relatively remote areas, local businesses involved and other specifics, the daily costs of living are typically higher than average in most resort areas.
Are you buying for investment or enjoyment?
Acquiring vacation homes can be costlier than buying your primary family home. With higher prices, costs of living and often higher maintenance and management fees, if you are looking at buying a vacation home as an investment to generate positive cash flows, look at Upnest buyer reviews and then check and recheck your figures with a trusted realtor near you. It’s wise to take a conservative view, and don’t overextend on financing arrangements (if you need funding that is).
What is the vacation home worth to YOU?
Value means different things to different people. If owning a vacation home on the best surfing beach or in favored ski fields with the ability to ski-in, ski-out is worth it to you—and you can afford it—why not?