Vacation Property Walkthrough: Considerations When Choosing A Vacation Property
As with other real estate purchases, location is the single most important factor when choosing a vacation property. Many vacation home buyers may already have an area in mind when deciding to purchase, while others might have to decide between several attractive locations. It is important to choose carefully. A property in a badly chosen location negatively affects the vacationer (who won't enjoy it), the investor (who can't rent or resell it) and the future retiree (who may have to move and find another home). Buyers need to consider personal preference and rely on research when selecting a location that best suits their needs and desires.
If possible, it may be helpful to spend time in the desired area during different seasons. For instance, if a potential buyer has enjoyed spending summer vacations at a particular beach, he or she might want to consider a winter vacation in the same spot to see what it's like year round. This is particularly important if the home will be used as a primary residence during retirement. Visiting the area during the off season can provide insight regarding the true local "flavor" - and what to expect when the tourists are gone.
People who enjoy international travel can think globally when choosing a location for a vacation property. The beautiful settings, low costs of living and low property taxes in many international locations are attractive to many vacation home buyers. Some of the world's most affordable housing markets are not in the United States, but they are still relatively close to home. A couple who has enjoyed spending time in Central America, for example, may wish to explore the region's many vacation property opportunities. Certain popular international destinations attract entire communities of expatriates.
If the vacation home is to be used primarily as a weekend getaway, an overseas destination may not be practical unless the buyer is close to an international airport and the home is just a short flight away. International vacation homes may be best suited for buyers who can make extended trips or who plan on using the home as a primary residence during retirement.
While a home on a secluded island may sound like the perfect retreat, a vacation home will likely get more use if getting to it is relatively easy. If buyers are concerned with both convenience and resale value, vacation properties that are located within three hours of a major metropolitan area may fare the best. Attention should be paid to the actual travel time involved - not just "how the bird flies" on a map. Some vacation spots are close to metropolitan areas miles-wise but take an unexpectedly long time to travel to because of road types (think winding mountain roads), road conditions (washed-out dirt roads) or limited ferry schedules. One should also consider the proximity to airports if air travel will be the primary means of transportation to the vacation property.
If the home will be used as a primary residence in the future, buyers should consider the property's proximity to conveniences and needed services. For example, a vacationer may not mind spending 45 minutes to get to the grocery store; however, that drive could be too long for a full-time resident. Access to quality healthcare may be another important factor in deciding where to purchase.
Types of Vacation Properties
The type of vacation property is another important consideration. A vacation property may be a single-family home, a condominium unit, a townhouse or a fractional ownership (discussed in the "Fractional Ownership" section of this tutorial). Each type has its advantages and disadvantages, and choosing is a matter of personal preference. A single-family home, for example, will have different costs and demands than a condominium unit or townhouse. Condominium units are popular vacation properties because the owner is not responsible for any of the maintenance outside of the individual unit. Lawn care, exterior painting, pool cleaning and garbage removal are all handled by the condominium association. All owners pay monthly condominium fees for these services, however, but many find it worth the costs, especially if the owner will be absent much of the time.
Single-family homes, on the other hand, do entail more maintenance responsibilities, but buyers may be willing to have these responsibilities in exchange for more privacy. Sometimes the desired location dictates the prevailing property type and style. For example, many vacation homes in rural mountain and lake communities are single-family log cabins, while beachfront properties tend to be rich with single-family homes and condominiums.
Area Features and Attractions
Many people purchase a vacation property to be close to a feature they love - whether that's the beach, a mountain lake or a ski resort. If the vacation home's primary purpose will be to serve as a family getaway, ideally it will be located somewhere that the buyer will look forward to spending time year after year.
In addition to the geographic features of the area, vacation home buyers may also wish to consider tourist attractions and community offerings. Will there be enough activities to keep the kids occupied? What about rainy days? Does the community offer a variety of interesting pursuits for retirees? Are there nearby libraries, amusement parks, fishing piers, golf courses, mountain bike trails or other attractions that would be important to the buyer? Is the healthcare adequate?
When making purchasing decisions, buyers must consider long-term plans for the property. If the property will be held for many years or into retirement, it should be able to meet both current and future needs. Will the property be used for large family gatherings, perhaps with grandchildren in the future? If so, buyers may wish to look for properties with more bedrooms and baths than are needed now to make sure the property offers expansion potential. Is the property centrally located to all family members? If the property will be passed on to future generations, do the children enjoy the property, and will they continue to do so in the future? Will the children be able to keep up with the expenses and maintenance? Asking these questions before making a purchase can help buyers find the most appropriate vacation home for current and future use.
Vacation home buyers may have the flexibility to "time" a purchase and take advantage of favorable market trends. Following the financial crisis of 2008-2009, for example, many markets were flooded with inventory and as a result, home values dropped considerably. However, certain "buyers' markets" may come with hidden consequences; it could be years or even decades before home values recover in the most hard-hit areas. Buyers who are in it for the long haul may be less affected by this than purchasers looking for a short-term vacation opportunity. Many real estate search websites, such as www.trulia.com and www.zillow.com allow users to view market trend and statistical data for specific areas. Users can find summaries that include median sales prices, the number of sales, average listing price, number of listings, average price per square foot, and area crime and community information.
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