Are you interested in buying a second home? Before signing for your new vacation home, make sure you avoid these common mistakes buyers make.
Making an Emotional Decision
Perhaps the biggest mistake everyone should avoid when buying a vacation home is making an emotional decision instead of a practical one. It happens all the time—someone takes a vacation somewhere and falls in love with the area so much they laser-focus on that one area to buy a second house.
While it’s great to search for a vacation home in an area you’re already familiar with, you don’t want to limit your options before you even start your search—you may find better value in a different area. This may seem disappointing at first, but you’ll realize it was the best decision in the long term.
Not Conducting Thorough Research
One of the problems with making an emotional decision for a vacation home is it often means the buyer hasn’t done their research. A vacation house is a sizable investment and asset that can dramatically affect your finances, so you want to be confident in your final decision.
Before you narrow down your options and decide, you’ll want to conduct as much research as possible about the property, the surrounding neighborhood, and the location. What’s the property’s history, and how have home prices in the community changed in the last 10 years?
Pro Tip: Familiarize yourself with local property tax laws and possible tax benefits for second homeowners and landlords.
Breaking the Budget
Even if a house is over your budget, it can be challenging to say no to what you think is the vacation home of your dreams. But a dream vacation home can become a nightmare if it becomes too much of a financial burden.
Before you start browsing properties, set a strict budget for yourself and stay disciplined in holding to it.
Overestimating Potential Rental Income
Sometimes, buyers will convince themselves to go over budget on a vacation home by noting the potential rental income. While renting out a vacation home when you’re not there is a great passive income opportunity, there are no guarantees as a landlord.
It could be months or years before the property can host renters, and even longer before it starts to turn a profit after maintenance and expenses.
Not Considering Maintenance & Management
Too often, vacation home buyers don’t consider the maintenance costs for their new property. Managing a home hundreds or thousands of miles away can be an expensive hassle.
Property management companies can help, but that’s an added cost; if you’re already at the edge of your budget, it could tilt you over what you can afford.
One way to avoid these common vacation home-buying mistakes is to use a trusted real estate company like 30A Local. We can help make your search easier for properties along the 30A, like Watercolor homes for sale or vacation properties in Alys Beach.
