Summer is here and for many of us, that means vacation time, family get-togethers and possibly some travel. What represents a great vacation really depends on who you ask. HomeBridge has offices across the country and the list of what each of our 1,400 associates considers a vacation is as diverse as the communities we serve. One trend HomeBridge is seeing right now is that people all around the U.S. are purchasing second homes to act as their vacation home and sometimes, as rental properties.
Regardless of if your ideal vacation home is a cabin in the mountains or a condo by the beach, the decision to purchase a second home can have major personal financial benefits in the years to come.
Have you wondered if a vacation home is right for you? Here are a few of the reasons HomeBridge’s borrowers have chosen to buy one:
1. A vacation home can act as a secondary source of income.
If you purchase a vacation home in a popular location, you may decide to rent it out for part of the year so it can earn you additional income. In many instances, rental income from a vacation home can offset either the entire mortgage or a large part of it.
Understandably, not every homeowner wants to take the responsibility of managing a rental property. If that’s the case, a quick search online using Google or Yelp can reveal multiple vacation home property management companies that will handle all of your vacation home’s needs in exchange for a fee.
2. Vacation homes can act as yearly gathering place and memory makers for families.
Of course, one of the main reasons people purchase a vacation home is so they can use it for themselves and their family. Vacation homes can provide a consistent, comfortable place for you to visit whenever you have time and also make a great focal point for family reunions or similar events.
3. Multiple tax benefits.
There are many tax incentives that can come from owning a vacation home, even if you choose not to use it as a rental property. The tax benefits you may receive because you purchase a vacation home will vary depending on the location of the property, how often you use it, if it is used as a rental property and if so, how often you rent it out. You should consult with a professional tax advisor to learn more about the financial benefits that can come from having a vacation home.
4. Your vacation home can be a great investment in your financial future.
Financial experts cite home ownership as a smart long-term investment and the same thinking can be applied towards a vacation home. Over the years, especially in desirable locations, vacation homes can increase in value, giving you a great financial return on your investment if you decide to sell it or leverage the equity in this property for something else.
5. Vacation homes can make great places to retire.
When the time is right, many people opt to sell their primary residence and into their vacation home.
Vacation homes make great places to retire as they tend to be in desirable locations the owners are intimately familiar with, are filled with fond memories and often require less maintenance than larger, primary residences. After all, they are vacation homes, so why wouldn’t you want to live there year round if you could?!?
Keep in mind that the tax laws surrounding vacation and rental properties vary by location and their use. Before you purchase a vacation home, you should consult with a tax specialist for their guidance.
Are you interested in purchasing a vacation home or a rental property? Our associates are experts when it comes to these mortgages and would be happy to help you, even if it’s just to test the waters.