Would you own a vacation home?
Mar 17th, 2006, 05:11 AM
#1
Would you own a vacation home?
There are all kinds of questions here. But, would you own a vacation home for investment? A ski place, a beach house, a lake house???? Does the traveler in you say no to visiting the same place year in and year out? Let's say you can still take a regular vacation once a year outside the vacation house. How many of you have invested in vacation property...not a timeshare.
Mar 17th, 2006, 05:32 AM
#2
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There are long threads on this subject, one just recently.
Yes, I have a lake house. It was one of the best things I ever did for myself and my future. This particular one I have had for almost 4 years. I still vacation at least 3 places other that the lake a year, sometimes more. I will be in Canada at the end of May (Toronto)- for example.
In the past one of my other trips has always been out West, FL, Caribbean, or Europe. I also go on drive vacations about every other year for 5 to 8 days.
Other things like sick parents and busy worktimes have kept me from traveling far more than the lake house has.
Yes, I have a lake house. It was one of the best things I ever did for myself and my future. This particular one I have had for almost 4 years. I still vacation at least 3 places other that the lake a year, sometimes more. I will be in Canada at the end of May (Toronto)- for example.
In the past one of my other trips has always been out West, FL, Caribbean, or Europe. I also go on drive vacations about every other year for 5 to 8 days.
Other things like sick parents and busy worktimes have kept me from traveling far more than the lake house has.
Mar 17th, 2006, 05:34 AM
#3
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First off, you should not look upon a "vacation home" as an investment. True a property in a desirable location should appreciate in value but that should not be the driving force in your decision to buy a second home. Rather, you should consider a "vacation home" much the same as your primary residence - i.e. a place you will keep and use for yeras and perhaps pass on to your heirs. While some people do derive an small income from renting out their properties most who go the rental route barely cover their costs. That aside, there are a great many people who own vacation homes and are quite happy with their decisions. It depends on your lifestyle and your own desires. There's no right or wrong answer to your question. I love my second home in the Caribbean and try to get there as often as I can (no I don't rent it out) but I am also fortunate enough to be able to travel to other areas several times a year.
Mar 17th, 2006, 05:42 AM
#4
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Every time we have rented a house, we say "wouldn't it be nice to own this" - but then I am not sure I would be able to relax as much if I woned it. I would see yard work to be done, counters that needed to be replaced, etc. That and financial limitations, and we never did.
But now that last kid is off to college in 2 years, we have considered selling house and having 2 residences - perhaps small condo in/near Boston and "vacation" house on Cape Cod, Maine, etc. Financially could do both with proceeds from sale of house.
Friends with teenagers often have found that once the kids reach that age, they are less able or interested in retreating to vacation house.
But now that last kid is off to college in 2 years, we have considered selling house and having 2 residences - perhaps small condo in/near Boston and "vacation" house on Cape Cod, Maine, etc. Financially could do both with proceeds from sale of house.
Friends with teenagers often have found that once the kids reach that age, they are less able or interested in retreating to vacation house.
Mar 17th, 2006, 05:50 AM
#5
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Mine has become a Mecca for two of my three kids and for my 5 Grand-kids. No, they don't want to go all the time when they are teen-agers, but I didn't do it for them, I did it for me.
Everytime I get there it's like being reborn. And I never rent it out, but have let friends/fishermen use it for a week or two a year.
I do little work there except the things I like to do anyway- like gardening- but only minimally. Most of the time I am either in the water, on the pier or on the deck- but in winter I have been inside and still love it.
Everytime I get there it's like being reborn. And I never rent it out, but have let friends/fishermen use it for a week or two a year.
I do little work there except the things I like to do anyway- like gardening- but only minimally. Most of the time I am either in the water, on the pier or on the deck- but in winter I have been inside and still love it.
Mar 17th, 2006, 05:51 AM
#6
Gail, if you owned a vacation place at the beach, I am sure your teenagers would visit. I am also sure they would come back with "their kids" to visit.
My DH wants to buy a vacation place. I am more reluctant.
My DH wants to buy a vacation place. I am more reluctant.
Mar 17th, 2006, 05:57 AM
#7
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We bought a beach cottage about 4 years ago and I HATE IT.
gail you hit the nail on the head. I can never relax there.
No sooner do we arrive that we have to do a dusting & cleaning...things have blown around the yard, something is broken, some problem has arisen, landscaping needs tending, chores need doing, repairs need mending...on and on and on. its all work and no play and then the weekend is over.
fortunately it is a good financial investement and will serve us well in years to come....but there is NOTHING like the aaaahhhhhhhh feeling of arriving at a house that you have rented for the week and the only thing you have to do is whip up some margarittas and watch the sun set.
gail you hit the nail on the head. I can never relax there.
No sooner do we arrive that we have to do a dusting & cleaning...things have blown around the yard, something is broken, some problem has arisen, landscaping needs tending, chores need doing, repairs need mending...on and on and on. its all work and no play and then the weekend is over.
fortunately it is a good financial investement and will serve us well in years to come....but there is NOTHING like the aaaahhhhhhhh feeling of arriving at a house that you have rented for the week and the only thing you have to do is whip up some margarittas and watch the sun set.
Mar 17th, 2006, 06:08 AM
#8
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We owned a boat for 8 seasons. We lived on her from Friday after work to Sunday night April to October when she went into dry dock. As much as we loved being on the water, it is a lot of work. You have two places to do maintenance on, and to clean. You also have a lot of company which requires more washing and cooking and expense. We won't do it again. We had a lot of fun but the work and maintenance is not worth it for us.
Mar 17th, 2006, 06:27 AM
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I hear the work complaints from others and respect them as it never is totally work free (I have to change the sheets on the beds), but that's why I picked out the non-maintenance place home that I did. It has stone, ground cover, very little grass- and everything is really always "on". It is on the lake in heavy wood and not like a suburban setting. A tree could fall and it just lays there. Or I use it for firewood eventually. LOL! It used to be a modular home turned into a permanent home by deck and other additions. Everything is low maintenance. I even have blinds that are INSIDE the windows. When I get there I unpack some food, open my wine, flick the blinds and that's it. Really.
I don't even have to unpack as I keep a second set of everything there. I don't even go with a suitcase or makeup bag etc. All there. I shop for that house about twice a year for about 3 hours each time. That truly is it.
If you can't relax because you feel you should be upgrading or repairing and feel quite different in a rental room- then it isn't for you. It certainly is not for everyone. If you have misgivings before you even start, it definitely isn't for you.
You have to understand that I LIKE to rehab houses too. I never did with this one, but that would not be a chore for me, more of an adventure. And I have had resort rooms that I was never a fraction as relaxed in either- for all kinds of reasons.
The day when I don't get the leap in my breast everytime I get on that deck and see that view- I will probably no longer keep it. But I'm seriously considering leaving IL and moving to that area permanently, maybe with something even bigger. But I don't think I will ever get a better view, deck, sunset, or lake- so I doubt it.
The boat, pier and pole barn are all far more work than the house. I don't do any of those things. My guy wanted them and he does them. He is early retired and spends about 1/3 rd of the year there fishing.
If you are the kind of person that feels a heavy cloak of responsibility on your shoulders for every septic decision or county issue etc. then don't do it.
I don't even have to unpack as I keep a second set of everything there. I don't even go with a suitcase or makeup bag etc. All there. I shop for that house about twice a year for about 3 hours each time. That truly is it.
If you can't relax because you feel you should be upgrading or repairing and feel quite different in a rental room- then it isn't for you. It certainly is not for everyone. If you have misgivings before you even start, it definitely isn't for you.
You have to understand that I LIKE to rehab houses too. I never did with this one, but that would not be a chore for me, more of an adventure. And I have had resort rooms that I was never a fraction as relaxed in either- for all kinds of reasons.
The day when I don't get the leap in my breast everytime I get on that deck and see that view- I will probably no longer keep it. But I'm seriously considering leaving IL and moving to that area permanently, maybe with something even bigger. But I don't think I will ever get a better view, deck, sunset, or lake- so I doubt it.
The boat, pier and pole barn are all far more work than the house. I don't do any of those things. My guy wanted them and he does them. He is early retired and spends about 1/3 rd of the year there fishing.
If you are the kind of person that feels a heavy cloak of responsibility on your shoulders for every septic decision or county issue etc. then don't do it.
Mar 17th, 2006, 06:31 AM
#10
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My family has several and the first rule of thumb is never ever purchase if you can't cover the mortgage without renting the house out.
As Sunnyboy stated, you cannot look at it as a financial investment but a mental one (if you can enjoy it that is which isn't the case with NJriverchick).
The bottom line, there are so many faucets to owning a second home and it is much more of a responsibility than one would think.
As Sunnyboy stated, you cannot look at it as a financial investment but a mental one (if you can enjoy it that is which isn't the case with NJriverchick).
The bottom line, there are so many faucets to owning a second home and it is much more of a responsibility than one would think.
Mar 17th, 2006, 06:38 AM
#12
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I apologize to those who are sick of hearing my little saga. I can't help being the cheerleader of second homeownership because it hasn't bitten me in the a&& yet. I know there will be issues to deal with but so far its been a happy choice. No buyer's remorse.
We bought a place in AZ last June because I fell in love with the Valley of the Sun the previous fall. It just feels like home to me. I hate the depressing gray midwest winters and love getting away for long weekends.
I bought a couple of books on owning vacation homes to try to decipher tax implications, investment opportunities, whether to lease it out, home vs. condo, best location, etc. I talked to several neighbors who are realtors and loan officers who own local and out of state properties. DH & I debated buying a place for the long term (house, garage, more square footage) or a more short term purchase (condo, carport, small).
We also looked at our investment portfolio with financial advisors and like many others decided that real estate in an area popular with baby boomers was more appealing that throwing more $$$ into stocks and bonds. I also wanted to stick my foot in at a time when I know I can afford to buy and not worry about getting priced out of the market later due to increasing prices.
We currently have enough income that the second mortgage does not change our lifestyle (still travel to many other places throughout the year, no trouble helping our kids pay for college) and we will pay off the mortgage within five years.
The Midwest is losing more and more baby boomers to the south and west all the time. Over the next ten years the boomers will have even more disposable income (homes paid off, kids' college tuition paid, etc) while living even longer. While I don't have a crystal ball, according to most predictions the Phoenix/Scottsdale area is going to remain popular with the boomers if I ever want to sell.
We had no plans to lease the unit but were approached by a leasing agent and the rest is history. Because we rent in a retiree market we rent only by the month or longer so we are less concerned about hard use. We are already booked for all of spring of next year as well by the same tenants. Our monthly rental income is more than double the monthly mortgage payment.
We bought a place that didn't need work & came furnished but the updated decorating (paint, light fixtures, towel bars, Pier One accessories, 600 thread count sheets and thick towels, new plates/dishes) have made it very popular with both my leasing agent and his clients.
We bought a place in AZ last June because I fell in love with the Valley of the Sun the previous fall. It just feels like home to me. I hate the depressing gray midwest winters and love getting away for long weekends.
I bought a couple of books on owning vacation homes to try to decipher tax implications, investment opportunities, whether to lease it out, home vs. condo, best location, etc. I talked to several neighbors who are realtors and loan officers who own local and out of state properties. DH & I debated buying a place for the long term (house, garage, more square footage) or a more short term purchase (condo, carport, small).
We also looked at our investment portfolio with financial advisors and like many others decided that real estate in an area popular with baby boomers was more appealing that throwing more $$$ into stocks and bonds. I also wanted to stick my foot in at a time when I know I can afford to buy and not worry about getting priced out of the market later due to increasing prices.
We currently have enough income that the second mortgage does not change our lifestyle (still travel to many other places throughout the year, no trouble helping our kids pay for college) and we will pay off the mortgage within five years.
The Midwest is losing more and more baby boomers to the south and west all the time. Over the next ten years the boomers will have even more disposable income (homes paid off, kids' college tuition paid, etc) while living even longer. While I don't have a crystal ball, according to most predictions the Phoenix/Scottsdale area is going to remain popular with the boomers if I ever want to sell.
We had no plans to lease the unit but were approached by a leasing agent and the rest is history. Because we rent in a retiree market we rent only by the month or longer so we are less concerned about hard use. We are already booked for all of spring of next year as well by the same tenants. Our monthly rental income is more than double the monthly mortgage payment.
We bought a place that didn't need work & came furnished but the updated decorating (paint, light fixtures, towel bars, Pier One accessories, 600 thread count sheets and thick towels, new plates/dishes) have made it very popular with both my leasing agent and his clients.
Mar 17th, 2006, 06:50 AM
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Had we purchased a house rather than a condo I'm afraid I might feel just like NJriverchick! Too much work, no play. But with the condo we truly relax. I love it because there is so little that needs to be done. We have a balcony on a courtyard and the landscape crew is there literally every day pruning, raking, planting.... The condo is so small that it takes very little time to clean when I leave and if I hire a cleaner they only charge $75.
I have two different kinds of vacations to the condo- totally relaxing weekends with friends 7 family OR workweeks all by myself. As a teacher I have summers off so I have gone twice to do nothing but work. Like JJ5 I actually like the rehab aspect. I love dreaming of granite, stainless, oil rubbed bronze, tile... All of that is done in my primary residence so now I expend the energy on the condo.
I have two different kinds of vacations to the condo- totally relaxing weekends with friends 7 family OR workweeks all by myself. As a teacher I have summers off so I have gone twice to do nothing but work. Like JJ5 I actually like the rehab aspect. I love dreaming of granite, stainless, oil rubbed bronze, tile... All of that is done in my primary residence so now I expend the energy on the condo.
Mar 17th, 2006, 06:54 AM
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I'm with you on all of it, amwosu. But in my particular case I never rent it out and have only a small portion of the mortgage left to pay at all, and it hasn't in one iota changed my lifestyle at home. I'm frugal anyway, and don't spend money on what many others consider luxury items that depreciate to nothing in months (like cars, clothes). I'm not a shopper either, nor one to change furniture or decore on a whim.
I'll spend some money on travel, yes. But time has always been a much bigger factor than the money has. Most people spend their money on things that "disappear"- I don't. I don't need to rent it.
My money is increasing far, far more than if I had had it in any stock or mutual funds. Plus what I have will be unbuyable within 30 years, IMHO. Lake and shore property is finite.
If you are doing it in an area that is very "fashionable" and where many others have already done it too- you may still enjoy it and it may still be profitable in the long run for fun and for equity- BUT if you do it in an area BEFORE the others get there. WOW! I didn't mean to do that, but I think I have. And the appreciation is immense when that happens. I'm checking out KY, TN, and AK next. I may with one child go to three, who knows.
I'll spend some money on travel, yes. But time has always been a much bigger factor than the money has. Most people spend their money on things that "disappear"- I don't. I don't need to rent it.
My money is increasing far, far more than if I had had it in any stock or mutual funds. Plus what I have will be unbuyable within 30 years, IMHO. Lake and shore property is finite.
If you are doing it in an area that is very "fashionable" and where many others have already done it too- you may still enjoy it and it may still be profitable in the long run for fun and for equity- BUT if you do it in an area BEFORE the others get there. WOW! I didn't mean to do that, but I think I have. And the appreciation is immense when that happens. I'm checking out KY, TN, and AK next. I may with one child go to three, who knows.
Mar 17th, 2006, 06:56 AM
#17
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We own a cottage. My grandfather built it just after WWII. The family had it on the market and my DH and I just couldn't let it go so we bought it. We ended up having to gut it and rebuild on the foundation...there were carpenter ants, mice and bats living in the walls and some of the floor joists were rotting. We have been putzing away for 16 years and it is nearly complete; just need baseboards now. We have a painted wood floor so you can come in with wet, sandy feet and not worry. I relax there like nowhere else. It is a good place to entertain; I just point out the beer & wine to my guests and invite them to join me on the porch. I am way less uptight than when I entertain in my home where I feel the whole house should sparkle for company!! It is a multi generational retreat. We hope to never have to sell it, but it has certainly appreciated in value and our stock portfolio has not fared as well, so all in all I say YES to owning a vacation home!!
Mar 17th, 2006, 07:02 AM
#18
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"Everytime I get there it's like being reborn."
This is how we've always felt about the place we bought as a second home. But bought it as an investment at the time, never expecting how much we'd fall in love with it. (Also, we bought when kids were in their late teens and it's true - leaving town and friends to spend time at the 'vacation' house was never appealing to them at that stage of their lives.)
We were lucky at the time, 1987, as our f/t house was pretty modest and we were able to carry two mortgages for less than most people were paying for one.
Never ever thought, however, when we first bought it, that it would become our retirement home. Have lived here f/t for 10 years now. $$ appreciation has been excellent. We love where we live - just wish it wasn't too many hours away from the grandbabies.
This is how we've always felt about the place we bought as a second home. But bought it as an investment at the time, never expecting how much we'd fall in love with it. (Also, we bought when kids were in their late teens and it's true - leaving town and friends to spend time at the 'vacation' house was never appealing to them at that stage of their lives.)
We were lucky at the time, 1987, as our f/t house was pretty modest and we were able to carry two mortgages for less than most people were paying for one.
Never ever thought, however, when we first bought it, that it would become our retirement home. Have lived here f/t for 10 years now. $$ appreciation has been excellent. We love where we live - just wish it wasn't too many hours away from the grandbabies.
Mar 17th, 2006, 07:16 AM
#19
Thanks for all of your replies. He has his eye on a condo. It is older and needs a little updating. It isn't bad. It is a ski area. We can afford it without renting it, but would rent it to help pay for it. I am not sure why I am so negative. We all enjoy our time there. It is also a time where we spend a lot of time with our kids. The tv gets bad reception. Cell phones don't work. (That is a future plus. They don't have cell phones yet.). It is a healthy place with lots of outdoors activities. I am not the most outdoorsy person, but I am growing to like it more. I am also learning to not become a million pounds, I now have to work at it...uggh...
This is an idea we have had on and off for years. It is just always so expensive.
This is an idea we have had on and off for years. It is just always so expensive.
Mar 17th, 2006, 07:19 AM
#20
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Since I live in Naples, Florida, I decided long ago that any investment in property would be as good or better here as anywhere else, and much easier to maintain and keep tabs on. (and those investments have indeed been very kind to me).
I have never had a desire to own a vacation house, as there are far too many places I'd like to travel to. I have no desire to return to the same place every year for my vacation -- nor do I have a desire to spend half or more of my time there doing needed repairs and fixing up.
On the other hand I know lots of people who bought condos here in Naples for their vacation home from the Midwest. Most have easily been able to rent them enough to pay all their yearly expenses, and have multiplied their investment many times over (maybe by as much as tenfold if they bought it more than 15 years ago).
I have never had a desire to own a vacation house, as there are far too many places I'd like to travel to. I have no desire to return to the same place every year for my vacation -- nor do I have a desire to spend half or more of my time there doing needed repairs and fixing up.
On the other hand I know lots of people who bought condos here in Naples for their vacation home from the Midwest. Most have easily been able to rent them enough to pay all their yearly expenses, and have multiplied their investment many times over (maybe by as much as tenfold if they bought it more than 15 years ago).
