From having a space to enjoy on your time off to making some extra money, there are many reasons people purchase a second home. But, owning a second home comes with a lot of responsibility. Before you take the plunge, it’s important to determine which type of property you’d like to buy and to be realistic about how much time and energy you can commit because maintaining two properties can be challenging.
Read on to discover the different types of properties, benefits of purchasing in a managed community, and additional tips and tricks to keep in mind when buying a second home.
Choosing Which Type of Second Home to Purchase
Before you choose the type of second home you want to purchase, consider your reasoning for buying. Do you want a vacation spot? Do you want a place to go when the weather gets cold? Or do you want to make money by flipping a home or renting it out? After determining your purpose, then you can choose which type of second home is right for you. There are typically three types of second homes you can buy: a vacation home, seasonal home or an investment property.
A vacation home is a second home purchased to use with friends and family during time off.
A seasonal home is a property where you reside for a season or two. Seasonal homes in warmer climates are quite popular for “snowbirds” – or people with a permanent residence in northern cities looking to escape the cold winter months.
An investment property is real estate purchased with the intention of gaining a return on the investment. This could mean one of two things, you purchase a brand-new piece of real estate property for reselling or rental income purposes, or you purchase property with the goal of making upgrades or “flipping” it to later gain your return.
Purchasing a Second Home in a Managed Community
There are countless benefits to purchasing a home that is part of a managed community, and this is especially true for buying a second home. Beyond giving you additional resources and a second pair of eyes to watch over your investment, it also helps ensure steady home values. Below is a breakdown of the advantages of living in a managed community for each type of home you may purchase.
Buying a Vacation Home in A Managed Community
When it comes to deciding if you should purchase a vacation home in a managed community, it’s all about personal preference. If you want to live in a popular and thriving area, I would recommend living in a managed community not only because of the added value and security, but also because you won’t have to spend your vacation time doing yard work or other chores.
Buying A Seasonal Home in A Managed Community
In my opinion, it’s wiser to purchase a seasonal home in a managed community because you’ll have people to take care of off-season maintenance, and your property will always have some type of security. It’s likely that you’ll have neighbors (who hopefully become your lifelong friends) who live there full-time, so you can trust them to look after your property while you’re away.
Buying an Investment Property in A Managed Community
I do recommend purchasing an investment property in a managed community because it inherently and continuously adds value to a property.
If you plan to rent out your property in a community with an HOA, I recommend offering long-term rentals instead of short-term rentals. Short-term renters don’t typically take care of your home the same way you do, and you don’t want to lose value when you’re trying to turn a home around. Keep in mind that rental rules and regulations are different for each HOA, so make sure to check with your board of directors before renting out your property.
Additional Tips for Purchasing a Second Home
After you decide exactly which type of second home is right for you, use these tips to ensure your process is as seamless as possible.
- Make sure it’s easily accessible.
Before purchasing a second home, be sure it’s easy to get there. Confirm there are nearby airports and frequent flights to and from both properties so it won’t be a hassle to travel.
- Know your rights as a buyer.
Only work with a professional real estate company, agent, and a licensed real estate attorney throughout the purchasing process.
- Get to know the area.
It’s important to know exactly where you’re buying a property – don’t simply decide to buy a second home after visiting a city for a week or two. It’s essential that you do plenty of research, talk to locals, join online forum groups, and determine what will best suit your future lifestyle needs.
- Budget properly.
Budget for everything correctly and factor in any additional costs– like extra fees for real estate agents and closing costs.
- Use local businesses.
If you’re purchasing a home that you plan to flip, use local businesses with local prices. Local contractors that are native to the area have unique knowledge and will make sure your home fits in with the surrounding areas.
International Home Buying
If you’re looking to purchase your second home outside of the United States, then you should know the process can vary significantly from country to country, and you should familiarize yourself with local real estate laws and practices before purchasing. If you’re looking at homes for sale in Mexico, then we have you covered, check out our Mexico home buying guide here.
About the AuthorMore Content by Melissa Eisenman