How to Buy a Vacation Home

Buying a vacation home is exciting – but as with any other major purchase, it’s important to think things through carefully. Here are some suggestions to help you make the best buy.

Steps:

1. Decide whether this is a place where you’d like to spend every vacation. Base your decision on your lifestyle and recreational interests.
2. Select the type of vacation home that best suits your needs.
3. Visit desired locations and tour properties for sale.
4. Determine whether the vacation property you are considering buying is priced fairly. Check real estate ads and ask local real estate brokers for prices of comparable vacation properties in the area.
5. Hire professional inspectors to uncover any potential problems.
6. Consider how you will maintain the vacation property throughout the year. Get references of rental management firms that can take care of maintenance, upkeep and rentals when you are not there.
7. Ask an attorney or broker to review sales contracts and agreements.
8. Make an offer based on comparable prices in the area.

Tips:

• You may get a better deal if you buy during the off-season.
• If you’re seeking a time-share, look on the Internet for people selling their weeks independently.

Warnings:

• Consult a tax professional about tax consequences. Most experts advise that you should buy a vacation home for pleasure – not as an investment.
• If you rent out a vacation property most of the year, the IRS will only allow you to occupy the property for two weeks out of the year without affecting its investment-property status.