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Buy a Home


Careful Considerations

As with any real estate investment, the purchase of a vacation home is a big decision. It’s a residence you and your family will visit for years, as well as an investment with the potential to generate – or cost – a substantial amount of money. To make the choice that’s right for you, here are some factors to consider before committing.


A vacation property is a much bigger commitment than a hotel room or a timeshare. You’ll be making repeat visits, investing lots of money and possibly relying on the property for rental income. Location plays a big role in all of these factors. To decide if it’s a good fit:

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Consider the surroundings: Just as with a primary real estate investment, your satisfaction with your vacation home will be affected by factors such as walkability, demographics and even crime rates. If you’re considering the property for rental income, also research tourism factors. Is the area booming or in decline? Are there busy tourist periods that might conflict with your vacation or rental plans?
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Evaluate access: How far is the property from the nearest airport or major city? How accessible are the roads leading to it? Does traffic during the busy season come to a standstill outside your door? If a property is difficult to get to, chances are you – or renters – won’t visit very often.


Compare owning versus renting: Is owning a property in your favorite destination truly less expensive than a regular hotel room rental or timeshare? To find out, analyze your expenses in the area over the past several years and do some research on what these expenses might look like in the years ahead.

Calculate the complications::  Buying a vacation home can involve meeting different lending requirements from those of a primary home. You may need to make a larger down payment or pay a higher interest rate – and vacation homes have distinct tax reporting requirements as well. Plus, it’s possible you may be financing with a home equity loan rather than a mortgage. Make sure you’re comfortable with these and other financial factors.

Check against your budget: As you would with any sizable financial investment, consider how periodic and occasional expenses, such as mortgage insurance, property management and maintenance, will impact your budget and cash flow.

Daily Life

Make time for ownership: You may need to travel to the location more often during the selection and buying process and be present at the inspection and closing. A vacation home can take up your time and resources into the future as well. Have you anticipated the regular trips to check in on the property, or the phone calls, emails and other details involved in dealing with renters?

Assign caretaking responsibilities: A vacation home requires ongoing maintenance, repairs and periodic home improvements, and needs a caretaker when it’s unoccupied. Will you be handling this yourself or delegating these tasks to a property manager?

Decide who’ll act as rental agent: Are you comfortable handling rental duties yourself, or would you work with an agency? This can make a big difference in your day-to-day life and in your expenses.

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