Homes of Distinction Realty



Posted by Homes of Distinction Realty on 5/23/2019

If you are mulling over purchasing a vacation home, then you must go over a few considerations before you make the final decision. If done for the right reasons, it can end up being a great piece of investment, as you can save hotel and lodging costs when you visit and then rent it out during off seasons.

  1. Location. Location is essential because you can't just up and move at will, so consider the area of the property you are contemplating purchasing thoroughly. Will the site accessible and attractive to future guests? Is it located in a place that is prone to natural disasters like hurricanes and storms?
  2. Calculate the associated costs. Many other costs come along with purchasing a piece of property such as utilities, maintenance, homeowner association costs, property taxes, and insurance fees. You want to factor all this and determine that they are well within your budget. If you plan on using rental income to cover some of these costs, then you have to be practical about what rental income typically is in that area.
  3. Maintenance Issues. If you are buying that vacation property as an investment, then you have to make arrangements for who is going to manage it in your absence. Things like security and surveillance are critical. The speed at which you repair a bad pipe or faulty wiring may be the final defense between your house going up in flames or flooding. If you aren't around for long periods, plan to hire a facility manager who can supervise affairs.
  4. Finances. Run a money check with your financial adviser. Get someone to look at other tax issues such as buying out of state property. You might find that property taxes on that new place may not be deductible. Are you going to be able to meet up with your other long term financial commitments?
  5. Local laws. It's always necessary to run checks on local laws and regulations about homes in the place you choose. Make sure you hire a local property professional too as they are likely to be more thorough. Are you going to be allowed to rent it out, and are there regulations on the number of days it can be rented out?

Whatever you do, make sure you cover all your bases and consult with our realtor before you sign the final contract.




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Posted by Homes of Distinction Realty on 1/7/2018

Buying a vacation home is a significant accomplishment that can also be a source a joy for you and your family for years to come. However, owning a second home is also a responsibility that you’ll need to be prepared to take on.

In this article, we’re going to talk about some things you should ask yourself before buying a vacation home. It will help you solidify whether or not you’re making the best decision so you can enjoy your time in your new home away from home.

What do you love about the area?

Most people who buy a vacation home do so because they’ve fallen in love with the area. Maybe it’s where you can practice your passion for skiing, or maybe it has all of your favorite restaurants and places to relax. Regardless of the reason, you’re going to want to make sure that this is truly the place for you.

How much time will you spend there?

If your plan for your vacation home is to spend a couple weeks a year there and leave it vacant the rest of the year, it might not be the best investment. You could be better off staying in a hotel those few weeks a year.

However, if you’re buying a home with the intention of renting it out when you’re not staying there, having a vacation home can be a source of income. On top of that, if the house is in an up-and-coming area, you could be building a lot of equity that you can later take advantage of if you choose to sell.

Do you know all of the costs?

Do you ever feel overwhelmed with all of the bills and taxes you need to pay for your house? The same will be true of your vacation home. And, if you aren’t there enough, you’ll also have to pay someone to maintain the house and property while you’re away. Some costs to consider: closing costs when you purchase, property taxes, home insurance, heat, electricity, landscaping, cleaning, and trash removal.

Are you aware of the rules?

If you’re planning on renting out your property, it would be awful to find out that there’s a clause in your contract or with the homeowner’s association saying that you can’t rent it out. Similarly, some small properties have rules against parking RVs in the driveway, having structures (like sheds) in the yard, and even prohibit you from working on vehicles in the driveway. Make sure you know all the rules before you agree to buy the home.

Are you prepared for emergencies?

Whether it’s a flood, fire, avalanche, or burglary, you’ll want to make sure you’re ready. Insurance may be able to protect against some of these but there’s always a risk of serious damage.





Posted by Homes of Distinction Realty on 9/8/2013

If you have been dreaming of owning a vacation home now may be the time to buy. Home prices and mortgage rates continue to fall and there are some great deals for buyers looking for a second home. Here are five things you need to know before taking the leap. 1. Prices are at all-time lows In many second-home hot spots, prices are still close to their five-year lows. When the real-estate bubble burst, some of the hardest-hit markets were vacation destinations. Many vacation home areas experienced overgrowth and may now be suffering from foreclosures. 2. Think ROI Consider the possible return on your investment. Whether or not you decide to rent the home out, you will want to consider buying a place that has good rent potential. That's because a home's rent ability can affect its resale value. Before you bid on a house, make sure the homeowners association or township allows short-term rentals. 3. Don't count on rental income If you are planning on counting on rental income to cover the costs beware. According to HomeAway.com, a typical second home property rents out just 17 weeks a year. Make sure to account for the weeks the home won't rent. Plus, you'll need to pay for cleaning, maintenance, insurance, and maybe management fees. Make sure to plan on the maintenance costs of the property being at least 15% of the income. 4. Your mortgage rate depends on how you use the home How you use the home depends on the mortgage rate you will receive. If you plan to use the property primarily as a second home and you'll pay about the same mortgage rate as you would on a primary residence. If your plans are to use the home for rental income and need that income to qualify for the loan, you'll need to have as much as 25% for the down payment and pay up to one percentage point more in interest. 5. Take advantage of tax benefits Talk to your tax guy before you buy. If you rent the home out for two weeks or less you won't have to report a cent of income to the IRS. The good news here, you can still deduct property taxes and mortgage interest. On the flipside, if you stay there for less than two weeks or 10% of rental days, you can deduct operating costs in addition to interest and property tax. But where should you buy? According to CNBC here are the top places to buy a second home. If you are thinking about buying a second home I can help you find a professional agent in that area.