Many people dream of owning a vacation home where they can get away from it all in an environment where they make the rules. The idea of having complete control over your vacation destination is appealing, but there are some practical things you must consider before finalizing your vacation home purchase.
Do you really want to vacation in the same spot every time you get away from the world for a little while? Different people use their vacation homes for different reasons, but the bottom line is that you will be getting away from it all in the same place every time. You might think that you can go on other vacations while owning a vacation home, but the cost of owning a vacation home might force you to go to that same location year after year.
The costs for owning and maintaining a vacation home are very similar to the costs of owning your main residence. The biggest difference is that you live in your main residence and get plenty of use out of it, while your vacation home is not going to be used nearly as often. With a vacation home you will have a mortgage/condo costs, the dues for a homeowner's association (if you have one), routine maintenance, utilities, taxes, repairs, and insurance. When you add them all up, a vacation home can be very expensive.
Even if you hire a property management company to maintain your vacation home, you are still deeply invested in taking care of your vacation home. If you decide to take care of it yourself, that means regular trips to mow the lawn or shovel the walk and make regular repairs. If you shut your vacation home down for the winter, then there is a lot of work and costs associated with shutting the home down and reopening it every year.
The biggest mistake vacation homeowners make is assuming that they can rent their home out when they are not using it and generate an income. There is never a guarantee that someone will always want to rent your vacation home when you are not using it, and renting out your home brings in additional costs. If you happen to rent your vacation home out to a group who intends to party all week without letting you know, then you are going to lose money on that rental.
Sometimes people buy vacation homes that are hours away from their residence because they truly want to get away from it all. The first couple of years go fine because the experience is still new, but when you start driving for hours to go to the same location every time, it can begin to get monotonous. Be sure that your vacation home is accessible by roads that are safe to drive all year round and that your home is not too far away.
Buying a vacation home can feel like the ultimate freedom to many people. Before you make a major investment in your personal freedom, you should ask yourself some questions to make sure you are doing the right thing.