Whether you are buying property to be used as a holiday home or a regular investment with full-time tenants, the real estate market is now offering great value to one’s investment.
Without doubt we all want to have а holiday home whеrе one саn gо оn a holiday аnd feel аt home wіthоut thе impersonal atmosphere оr cost оf а hotel. And hаvіng а holiday home іѕ convenient whеn уоu wаnt tо escape tо thе ѕаmе location еvеrу year without the headache of hаvіng tо pack uр thе entire house bеfоrе leaving.
Having said that, buying а holiday home requires a fair amount to intelligence so as to ensure that your hard-earned money doesn’t go in vain. Indeed, some of you must have worked your lives out, saving the money to buy this dream holiday home. And when the opportunity comes, you can get deceived of all your savings without having the faintest idea of what exactly happened. In order to avoid such hassles, here are five holiday home buying tips to look into:
1. Do an extensive research: This is a prerequisite before buying a holiday home property, because without a thorough research you won’t be able to understand the real estate scenario in the area and will, perhaps, end up making a miserable deal. Be sure that the property is situated in a good, popular location. Location is not only important in terms of the capital appreciation over time, but is also an important factor in attracting guests when you convert your property into a holiday home rental. Moreover location is also important in terms of the capital appreciation over time and is an important factor in attracting holidaymakers.
2. What is your budget: After the research, just narrow down the properties you liked as per your budget and the loan you can get. Be double sure that you can afford it. Calculate the acquisition costs such as a deposit, transfer fees and conveyancing fees, as well as the impact of possible interest rate increases. Doing this will give you a crystal-clear picture in mind regarding what options you have to choose from. Also consider the ongoing monthly maintenance, security and insurance costs as well as the rates, taxes and utility tariffs in the area. Also know the tax implications of buying and running a holiday home rental business. Holiday home investors should remember that any rental income needs to be declared on their annual income tax return.
3. Managing your holiday home: Always consider the practical implications of managing a property in a different city or town. Intending buyers should consider appointing a professional rental management company or realtor that can conduct regular inspections and maintenance.
4. Rental trends: If you will turn your property into a holiday home rental, try to understand the holiday rental trends in the area, especially if rental payments are good enough to cover some of the expenses if not all.
5. Understanding holiday home rental cycles: Intending holiday home businessmen should understand that rental returns fluctuate widely for holiday homes, depending on the location and the season. For instance proximity to the beach and the ocean or a sea or with mountain view makes a huge difference to what rental can be charged. Plus there will be off-season periods when the holiday home will witness less bookings. So you need to consider these facts too.