Recently on The Cyr Team Real Estate Blog, we talked about some of the important things you need to know when buying an investment property. We touched a little on the idea of vacation homes, but we wanted to explore this topic a little further this week. Buying a second home purely for personal use is very different than buying a house for investment/income purposes.
New Vacation Priorities
One thing we have noticed in the past year is how the idea of a “vacation” has changed for many people amidst the COVID-19 pandemic. Travelers aren’t flocking to big cities and crowded airports. They are truly looking to get away and escape the crowds.
As a result, we’ve seen a definite change in priorities for the vacation home buyers we have worked with in the past few months. They are looking for second homes that are within a reasonable driving distance in order to avoid flying and public transportation. They are looking for someplace quiet where they can truly relax and enjoy peaceful moments with family or close friends who are part of their “bubble.”
Resort areas have always been popular destinations for vacation homes. Properties near beaches, mountain cabins, lakefront homes, country club villas and private ranches will always be desirable among second home buyers. This hasn’t really changed too much with COVID, other than people looking for places that may be a little further off the beaten path and away from super busy resorts. It’s nice to get outdoors and go skiing, hiking, biking, boating, hunting, golfing or any other fun activity you can imagine. Fresh air and exercise are good things as long as you can avoid major crowds.
Short-Term vs. Long-Term Planning
The thing that today’s vacation home buyers have to keep in mind is how this pandemic will change their second home interests over the long term. You want to find the right balance. It may be nice to buy an extremely secluded house in the mountains right now that allows you to get away from everybody, but will you still like it when life returns to some semblance of normalcy and going to the big ski resorts is less of a health risk? A bustling beach community may not sound like a fun idea right now. However, it may be the vacation lifestyle you prefer in the future.
You have to weigh your short-term priorities with your long-term lifestyle goals. If you are buying a vacation home in 2021, it’s important to consider all the factors. Ideally, this is going to be a property that you and your family will be able to enjoy for many years to come. It may even be where you intend to retire someday. You may even want to spend some time working from your second home, so office space and online connectivity could be important.
You could be able to get a great deal on a resort property in this market. You might not be able to spend much time there now because the resort is a bit too busy for your tastes, but it will give you a long-term vacation home that you can enjoy when this pandemic is hopefully behind us. Or, maybe you have learned that you enjoy the solitary lifestyle that has been forced upon you during this pandemic. This may drive you to look for a little farm in the country or remote cabin in the woods that is the perfect place to escape from civilization every now and again.
Budgeting & Financial Planning
Even if you are not earning extra income from your second property purchase, it is still a major financial investment. You have to know your priorities and what you want in a vacation home now and in the future. This will help you make better decisions of where you want to start your second home search, how you set your budget and how you start planning for your vacation-oriented lifestyle.
Speaking of the financial investment, that is also important to talk about. Purchasing a vacation home is often a very emotionally driven experience. You have a dream destination in mind and you want to find a home that gives you the lifestyle you are longing for. However, you still have to make smart financial decisions. Budget your investment carefully and understand how your financing is going to work, whether you are paying cash, taking out a new mortgage or using your primary residence’s equity to finance a second home purchase.
When you really think hard about where you want to live, how you want to live and how you will pay for it, you will be able to make better decisions when buying a vacation home. If you are looking to purchase a second home or investment property, contact The Cyr Team today for an introductory real estate consultation.