Buying a second home to be used as a vacation home is something many think about and some act upon. Is buying a vacation home something you should do? There is a lot to consider.
- Tax deductions – you can deduct the yearly taxes and interest paid on a mortgage if the home is rented for no more than two weeks per year.
- Additional income potential – you have the option to rent your vacation home during times that you or your family would not be utilizing the home, which introduces additional tax deductions as well
- Diversifying your investments – you may currently not be investing in real estate but it makes for a great opportunity to start
- Retirement – this home could be a jump start to your retirement as it could be the home you will one day retire too
- Quality family time – I personally think this could be the number one benefit, having a vacation home that allows you and your family the opportunity to create years of happy memories
Location: what you should consider when it comes to location.
- What are your long term goals for this home – will it be only used for family vacations, will it be used for a rental, will this be your future retirement home?
- Congestion – do you want to be in a high tourist area that gets congested during the peak vacation months? This may not be a concern if you are utilizing it solely as a rental but if it is your future retirement home will this be an issue for you long term
- Easily accessed for your schedule – will this home be a reasonable drive from your current home or will you need to plan on scheduling flights?
- Weather – do you want to vacation in a warm weather location or do you prefer a colder vacation spot and will this change based off of your future needs/wants?
Size and Style:
- Style – are you looking for a ranch, two story, multiple unit, condo? Keep in mind what your use for this home is and it will help determine the best style home that meets your needs
- Size – determining the size of vacation home that will meet your needs, you will need to determine your personal situation: do you have a large family/friend circle that you will need a lot of space or do you want to keep the size small so that at your retirement age you have the downsized home space you are looking to have?
We recently purchased our 2nd home that we currently use as our vacation home but intend to use as our retirement home in the future. We took all of the above items into perspective when we began our search and some items we thought we wanted we ended up changing after our discussions over future goals. We opted to purchase in Delaware and are very pleased with our purchase. Delaware was a location that we were very familiar with after over a decade of family vacations already in the books for us. We continue to grow our knowledge of the many areas of Delaware and the many amenities that Delaware offers. We look forward to continued family vacations and an enjoyable retirement.