Even if you’ve never seriously considered buying a vacation home, you may have at least contemplated (or dreamt of) the idea. But buying a vacation home isn’t like buying a pop-up trailer or even a deluxe RV—it is a big decision that requires a sizable investment and a significant commitment.
In light of this, is a vacation home right for you? Our list of 10 fun and practical reasons to invest in one can help you decide.
1. You’ll Always Have a Place to Stay on Vacay
Let’s face it—sometimes finding a decent hotel or vacation rental is a hassle. Either nothing is available, the rates don’t fit your budget or the properties are just…underwhelming. The beauty of owning your own vacation home is you don’t have to worry about any of that stuff. You can go whenever you want, at a price that you already know fits your budget (which, theoretically, aside from your mortgage payment would be $0).
2. Proximity to Your Favorite Activities
If you love to ski and snowshoe but hate the long drive up to the ski resort, a vacation home in the mountains can enable you to ski and snowshoe more often. Instead of driving up to the mountains at the crack of dawn and returning at night, for example, you can stay all weekend (and even return the following one if you want).
Naturally, this applies to tons of other recreational activities too—surfing, fishing, golfing, you name it (you can even buy a vacation home near your favorite wine tasting or theater venue if you want).
3. Vacation Homes Are a Great Place to Host Holidays and Special Occasions
Sure, you can invite everyone to your “regular” house to celebrate Thanksgiving, but how much more fun would it be to have your family and friends meet up at your vacation home instead (queue the very cozy holiday scene)?
4. No Need to Pack It All When You Can Leave Some Things Behind
While you’ll probably always need or want to pack certain things (like your iPad or your daily medications), you’ll also have the option of keeping a second set of personal and family belongings on site. This can include everything from clothes, shoes and toothpaste to bicycles, baby gear and non-perishable food and beverages.
5. Provides a Change of Scenery
Remember those dreadful COVID lockdowns (who doesn’t?)? During that time, a lot of people had to work from home—with kids underfoot—for weeks or months on end. Unfortunately, a change of scenery was nearly impossible because there was nowhere to go — unless you happened to own a vacation home, that is. Hopefully, this specific scenario won’t happen again, but it still wouldn’t hurt to have somewhere else to go anyway (just in case).
6. Vacation Feels Less Financially Burdensome
“Some families need to save thousands of dollars and wait several months just to finally escape,” says Justyna Malota of LaVueSXM, a vacation resort community in Sint Maarten. “But (if you own your own vacation home) you won’t necessarily need to. Invest in a property located in a place you LOVE. That last minute long weekend (when you property is vacant) can turn into the perfect opportunity to check in on your investment and steal some well-deserved sun.”
7. Can Help You Foster a Connection to a Place You Love
“Buyers who feel a deep connection to a destination and see themselves returning time and time again … will find (that) purchasing a home (in that location) will solidify their role as a part of the local community and eliminate sentiments of being a transient traveler,” says Chris Burden, chief development officer of Timbers Kaua’i at Hōkūala.
8. Vacation Homes Can Be a Source of Income
In its 2022 Vacation Rental Buyer Report, Vacasa (a vacation home management company) reports that 55% of vacation home buyers do so because they want to generate income. Another 41% buy so they can sell it later at profit. Even though these reasons are about money rather than personal R&R, they definitely—with the popularity of services like Airbnb and VRBO, you have the option to rent out your vacation home to other travelers as often as you wish, for rates that will cover your mortgage and then some.
“Short term vacation rental property is the best financial investment of any kind of real estate,” says Gail Goodwin of Montana Bear Properties, who owns vacation rentals in Whitefish, Montana and St. John. “You’ll make more from a well-managed short-term vacation rental in the right location than you ever will from an equally valued property in a long-term residential or commercial market … (and) You can also enjoy staying there and sharing it with friends and family.”
9. Establish Residency in Another Country
Owning a vacation home can help you move to another country, says Chris Atkins, who owns property in Costa Rica where he runs his businesses, Central America Fishing (this may be appealing to folks who want to retire or perhaps work outside of the United States). Rules, of course, will vary by country, so you’ll need to get details and information based on the place you are interested in.
10. Vacation Homes Offer Tax Advantages
Just like for your primary residence, you can deduct your vacation home’s mortgage interest and property taxes.
“These deductions will benefit you significantly if you are inside a modest income tax bracket, bringing real dollars into your pockets,” says Gunner Davis, a real estate agent in Tampa, FL.
You may also be able to deduct other things, like depreciation and travel expenses to and from the property for upkeep. Keep in mind, though, that taxes are complicated and potentially confusing, so always ask a tax professional about what is best for your situation (there are lots of tax rules when it comes to vacation homes).
Despite the appeal, vacation homes are not for everyone, so don’t start filling out your loan application just yet.
More Factors to Consider Before Buying a Vacation Home
Can you afford a vacation home?
On average, vacation homes in the United States are going for $429,000. That’s a lot of money, and if you don’t have a decent down payment and the ability to get a good interest rate it might be better to wait a while (and this doesn’t even take into consideration all of the other expenses that come with home ownership).
Do you mind going to the same place over and over?
For some people, vacation is all about new destinations and unique experiences. If this describes you, a vacation home might leave you feeling somewhat tied down. However, if the idea of vacationing at the same place every year makes you feel instantaneously relaxed, buying a vacation home might be a wise move.
Will you use it enough?
If you want a vacation home that you can visit regularly but suspect you wouldn’t get there often to get your money’s worth (and you don’t have the desire or wherewithal to turn it into short-term rental/investment property), you might be better off just skipping it until you have time to really enjoy it.
Bottom Line
Before you decide whether to buy a vacation home, you’ll need to weigh many pros and cons. If the answer is yes, great. Just be sure to consult professionals who can help you make the right decisions. If the answer is no, that is fine too—but you still deserve a vacation. Maybe a stay in someone else’s vacation home?
Text taken from: https://www.forbes.com