There's a lot to take in these days when considering the idea of a secondary vacation home. With the surplus of foreclosures in some of the prime US vacation markets, folks are wondering if now is the time to buy. But, there are still important questions to ask yourself before diving into those balmy vacation home dreams.
Due to the rapid decline of the once booming housing market, you're simply not going to get rich quick by buying a second home. So, does this mean you just scratch the idea all together? Not necessarily- but you may need to truly evaluate your reasons for wanting to invest in a secondary vacation home.
The rule of thumb for such a purchase in today's unstable market, is to buy for the immediate love of a vacation home, for the desire to own it and use it, with money and investment as much further considerations. Basically, you have to be prepared to hang on and hold on to what you've purchased for a while. You must be prepared to sail through the dips and dives in the economy, and like all things real estate, you'll eventually be rewarded for hanging in there. Or maybe you'll fall so deeply in love with your home that you'll never want to let it go!
So, if you've had a specific dream for a particular vacation home- say you've always dreamed of owning a piece of oceanfront or a ski condo- well then today's market may be suited to your dreams perfectly. Again, a smart vacation home purchase today, is one that you purchase out of love, and not for money.
The good news is, if your priorities are aligned right and a secondary vacation home is just the thing for you, well then you as a buyer have struck it lucky. As houses in today's market are certainly taking longer to sell, sellers are eager to move their properties and are more prone to offer incentives and to be extra willing in negotiations. If you find something you like, you're just about guaranteed to get it for less than asking price.
Another bonus for those considering a vacation home purchase is that the rental market is steadily on the rise. So, if you plan on helping pay those mortgage payments through rentals, then you've hit the right time.
Also, these days you can take your time shopping for the ideal home, in the perfect place. There's a lot on the market and again buyers have the power to negotiate.
Another consideration to be mindful of is a financial one. Can you really do it? While mortgage rates have come down, second-home loans are a tougher deal. They're a half to one percent higher than for principal homes and this is because banks know someone is more likely to walk out on their secondary home if in crisis. Banks are covering themselves as best they can in light of the current subprime mortgage debacle.
All things weighed and considered, if you're truly looking for a vacation home to love and enjoy over a relatively long term period, then the time is right for you to go ahead, shop and purchase your dream. Go for it!
