Vacation homes offer the most affordable holidays to families who love travelling regularly to different destinations.
Have you ever thought of buying or building a vacation home in your preferred city that you love visiting the most? What has made you consider acquiring one?
In most cases, families who are seeking to have a vacation home want to reduce the costs they spend on holidays and provide their loved one the comfort they deserve on holiday.
Before we dive into how we acquire an affordable vacation home, it is worth noting that vacation homes have unique features with regard to taxes and their financing.

Benefits
of Having a Vacation Home
There are benefits associated with owning a vacation
home, which is often considered a secondary residence. Below are some
associated homes.
Save on Holiday cost:
If you are travelling like 2 months in a year to holiday, it will reduce
significantly on the cost you could have used for hotel accommodations. And you
can use the saved funds to offset your mortgage.
Rental income:
A vacation home is a secondary home and you will be spending a very little
percentage of days in a year in that home. You can use the other days to rent
out for short-term rental incomes. You can use the funds generated from rental
income for renovations, management or offset mortgages.
Real estate values:
Vacation home like any other property appreciate over time.
Can be turned into a
primary home: If you buy or build a vacation home when are still
young, you can convert the house to be your primary home whenever you need it.
Tax breaks on mortgage: Like any real estate
property, it attracts tax breaks on mortgage interest and property taxes.
Cons of Vacation home
The benefits of owning a vacation home are
incomplete without discussing its disadvantages.
Expensive: Acquiring a vacation home especially in a highly visited destination tends to be expensive as compared to even buying the primary home.
Double expenditure bills: You will be required to pay property taxes, mortgage, utility bills, insurance for both your primary home and vacation home
Difficult to
finance: A vacation home does not attract a normal mortgage like
the one given to a primary home. Its mortgage is expensive in terms of interest
and high down payment because of the risk involved.
Maintenance responsibility: You will have full responsibility for managing the home, this might add you more work besides your current responsibilities on primary residence home.
Illiquid asset: Like any other asset, a vacation home cannot be converted to cash whenever one needs urgent cash without going into a loss.
How to invest in low-cost vacation homes
Build instead of buying a built house: When you buy
land and build, it is way cheaper than when you buy a ready to occupy house.
This is because when you build, you can build with whatever funds you have till
you complete the construction without putting yourself under unnecessary
pressure of mortgage interest.
Also, building from scratch allows you to choose
your preferred design that suits your family and holiday needs.
“If I were to consider acquiring a vacation home, I
will have to go to the suburb of the newly upgraded city of Nakuru and buy an affordable plot and start building my secondary home,” says
Rueben Kimani, Username Investment Limited.
Avoid Central Business centers in a town, go to suburbs.
It is advisable that you acquire a vacation home away from the city because it
is cheap and offer the serenity that you deserve in a holiday.
Rent out the house for short-term rental incomes
when you are not on holiday. With the sprouting of online booking for
short-term renting like Airbnb and Vacasa, one can now rent out their house
when they are not using it.
In conclusion, vacation homes offer various benefits to families that love taking a vacation every year. Based on its features, it is advisable to build for yourself than purchasing ready-built house.
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