Are you considering investing in a holiday home? If so, then there are a few different things that you need to consider.
It’s important not to rush into this decision because it is a massive financial commitment.
Here are some points to explore.
#1 Location, Location, Location
It’s fair to say that there are numerous popular locations in America and around the world where people tend to buy holiday homes. The trick is choosing a location where there is a high demand from holiday goers.
You need to avoid ending up in a situation where you are struggling to get a number of guests that you need to stay profitable. Florida is always going to be a great place to buy and the homes are even cheap here. There are lots of options too from purchasing a property on the Chain of Lakes to buying up home nearby to theme parks.
It’s entirely your choice but you might also want to think about choosing an area that you are keen to revisit yourself. We’ll get back to why a little further down.
#2 The Right Time?
As with any property purchase, you do need to think about whether it is the right time to buy a holiday home. You need to explore the area and make sure that prices aren’t at a massive high due to increased levels of demand.
The trick here will be making sure that you don’t have to worry about a mortgage shortfall. If this happens, then you could actually end up losing money when you do end up selling and that’s the last thing that you want. The good news is that right now the housing market is falling fast.
So, now could be a great time to buy your new holiday home, if you have the money you need.
#3 How Much?
So, how much is a holiday home going to cost you? Well, first you don’t have to pay the full cost of the property.
You just need a deposit and a solid level of credit that will allow you to borrow. There are lots of different sources of credit that you can explore. For instance, you could consider taking out a second mortgage on your home.
The benefit of doing this is that you will be able to get the money you need immediately so there will be no delay in purchasing your new property.
#4 Down Periods
Finally, you do need to think about down periods when you are purchasing a property like this. There are always going to be off-peak seasons where people aren’t as interested in renting.
You’re going to need to make sure that you factor this into your budget. It’s important that you are able to still make profits during this time. Of course, you could also use this period to access the home yourself and get a much-needed break away from it all.
This is another reason why it’s worth buying somewhere that you want to visit time and time again.
Are you thinking about investing in a holiday home?