Summer is one of the busiest times along the Shore as vacationers from all over the United States flock to the beaches of the Jersey Shore. While here, many fall in love with it just like we have. They begin dreaming and thinking about what it would be like to have a vacation home here. If you happen to be one of those vacationers, we have 6 simple tips you can follow when buying a home along the Shore.
1.Stay Awhile Before You Buy
It is easy to get caught up in the laid back lifestyle we experience while on vacation, but we would encourage you to stay here in the area a few times before choosing to buy a vacation home. You want to experience a few different seasons here if possible, especially if you plan to visit year round. If you plan to one day move to the home full-time, which 1/3 of buyers do, you want to choose a location that is right for you. The more time you spend in the area, the more you will learn and be able to decide which area you prefer.
2.Purchase Below Budget
When it comes to buying a second home you want to purchase a home that is below your budget instead of purchasing a property that stretches what you can afford. Buying a home at the top of your budget may leave you stressing with the high monthly costs. Many second home owners hire a management company to oversee the property while they are away. The cost of this should also be considered when purchasing a second home.
3.Be Realistic On Usage
Before you buy, be realistic in how often you plan to visit the home. You may think you will spend a great deal of time there and it will be a great investment, but consider what life changes may be coming in the future. Will your kids be getting older and be involved in sports and activities that prevent you from visiting as much as you would like? If you are not able to visit frequently would you still get enjoyment out of owning a vacation home?
4.Be Aware Of Tax Implications
One thing to be aware of is that the tax consequences of owning a second home are different than that of owning a primary residence. It can be more complicated at times. If you choose to rent out the home you will be required to pay income taxes on the rent you receive. Property taxes on your vacation home may be higher than where your primary residence is based on where it is located. A qualified real estate agent can provide you with the details you need about the property taxes in the area.
5.Estimate On The Low Side Of Rental Income
Many first time vacation home buyers tend to overestimate the amount of income they will take in from renting out the property. A local vacation rental agency can help you come up with a reasonable estimate on how often you can expect the home to be able to be rented out each year.
Also, be realistic when it comes to the amount of money you will spend each year on repair costs on the home and as well as management costs. A good rule of thumb is to plan to spend 1.5% of the value of the home each year on repairs. Always get a quote from multiple local property management companies before buying a home if you plan to use one while you are away.
6.Don’t Get Swept Away In The Moment
It’s easy to get swept away in the moment when it comes to buying a vacation home. Don’t make any rash decisions and always take the time to look into all the details before making such a large purchase. Take your time and do your research. A qualified real estate agent can help guide you through the process.
The Ferzoco Group are experts in the real estate industry and are familiar with the vacation home industry from Ocean City to Cape May. Real estate is one of the biggest investments of your life and The Ferzoco Group knows what it takes for you to take that leap of faith in real estate. We provide you with the tools, professional service, and resources it will take for you to live the dream. Contact us here, or give us a call directly at (609) 399-5454. We are here to help you with all your real estate needs.