Buying a vacation home is one of the most exciting long-term investments a traveller can make, but it can also be burdensome for first-timers. There are a number of factors to consider as you’re planning to purchase a second home. To help you in the process, Travel + Leisure spoke with Shaun Greer, vice president of sales and marketing at international home management company Vacasa, who shared his expert advice. Here are the five biggest mistakes to avoid when buying a vacation home. By
Making an Emotional Investment
Many vacation home investors decide they want to buy a second property after returning from a great holiday. Rather than acting on those emotions, buyers should do their due diligence to make sure they fully understand what they’re getting into before jumping into such a major investment.
“The most common mistake we see with second home buyers is not considering how often they’ll be using the home themselves,” Greer explains. “And, more specifically, for buyers who want to use the property as a short-term or vacation rental, it’s important to establish clear financial goals.” Instead of rushing into a big decision, take the time to step back and really think it over.
Not Thoroughly Researching the Neighbourhood
There’s so much more to consider when buying a vacation home than just the fact that you like the area. In addition to basic factors such as location and price, Greer notes that it’s “critically important” to ensure the area has everything you or your potential guests may need when visiting, including strong cell phone and Wi-Fi service, as well as proximity to shops where visitors can purchase food and supplies.
Most importantly, make sure you’re aware of the local regulations on renting out homes, if you plan on doing so when you’re not there. “If your situation should change and you need to rent the home, or if you decide to sell the [property], you should be aware of local regulations or HOA restrictions that may impact an owner’s ability to rent,” he says.
Buying Sight Unseen
Due to a competitive real estate market that shows no signs of slowing down, second home buyers may be inclined to purchase a vacation property without visiting in person — a decision that could turn out to be a big mistake in the long run. “More buyers may be willing to buy sight unseen these days, but we find homeowners are more often happy with their real estate investments when they’ve visited the area during both the peak and shoulder seasons,” Greer notes.
Not Sticking to Your Budget
Creating a comprehensive budget and sticking to it is crucial when buying a vacation home. In addition to the up-front price of the home itself, costs for items like furniture and HOA fees can sneak up on you if you haven’t thoroughly planned out your strategy. You should also factor in maintenance and upkeep costs, as well as the financial implications of self-management versus using a rental management company. “These are all important questions to address up-front,” Greer says.
Thinking It’s Easy to Manage a Vacation Home From Afar
Regardless of how often you visit your vacation home, you need to factor in how you plan to manage the property when it’s vacant, especially if you don’t live close. Greer notes that opting to work with full-service managers can ease the burden of maintaining a vacation home from afar, especially if it’s a mountain property or cabin that may need extra care during the winter. “It’s important to have a plan in place for maintaining the home to prevent damage or theft, so we encourage buyers to think ahead if their primary residence isn’t close by,” he says.
This story first appeared on www.travelandleisure.com