Purchasing a vacation home for you and your family can simplify getaways by providing you with a go-to destination that accommodates you well. When you visit your vacation home, you will pocket the money you would have spent on your stay elsewhere, and you call the shots in determining how little or how long you stay. Whether your vacation home is on the beach, near the mountains, or in the city or countryside, the following potential benefits come with owning a vacation home:
Rental Income– When you own a vacation home, you can use it as a rental property when you and your family are not enjoying it. A well-kept home in a desirable location can provide you with a second source of income, which you can use to help pay the mortgage and other expenses.
Additional Equity– Not only can a vacation home make money in the short run through rentals, but you can also build equity over time. If the home is in a thriving area, it is likely that the value will increase. So, when you are ready to sell your vacation home, the hope is that you will turn a profit.
Tax Benefits– Much like a primary residence, a second home can also provide tax deductions. Tax deductions from rental properties vary based on the number of days you plan to stay there each year, so it is important that you work with a professional to figure out the details.
Retirement Plan– Purchasing a vacation home with the plan of one day retiring there can be a huge money-saver. If you buy the home early, you will reduce the mortgage debt before it becomes your primary residence. Once you retire and sell your primary residence, you can use the money from that sale toward the remainder of the mortgage.
Before purchasing a vacation home, talk with your financial planner to make sure this is the right decision for you and your family. If you need a reference for one of my trusted real estate partners, I am happy to help you. When you are ready to purchase a new home or refinance, I hope you will trust me to guide you through the loan process.