What you need to know before buying a holiday home

What you need to know before buying a holiday home

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Buying a second property in your favourite holiday location may not always be as glamourous as it may seem. Maintaining and looking after another property far away can be quite difficult sometimes, so before jumping into the commitment, make sure you do your research thoroughly.

You could always rent the house out to other holidaymakers for extra income, but then you risk additional wear and tear on the property. You could keep the home for your holidays exclusively, but then it sits for most of the year unused. However you choose to use the holiday home, there are pros and cons to owning one.

Pros and cons of owning a holiday home

The obvious pro is that you’ll be able to visit your favourite seaside town or mountain cottage whenever you feel like it. You don’t need to book in advance or pay higher rates during peak holiday season. Your friends and family will also be able to make use of the property and create their own holiday memories too. Some holiday homes become retirement properties for their owners as well.

One drawback, however, is that the cost of keeping the property neat and tidy while it’s not in use can be a drain on finances, especially if it isn’t being rented out. If you do choose to rent it, the maintenance costs can increase due to the additional usage and possible breakages.

Do your research before purchasing a holiday home

Before signing any purchase agreements, make sure you know what to expect. Buying a holiday home requires similar research to buying a family home. Find out the average prices in the area so that you get a good understanding of what price to expect.

If you’re planning on renting the house to other holidaymakers, find out the average rental returns in the area so that you can set a fair price. Take into account the extra fees for rental agents, garden services and monthly rates. These monthly costs are often higher for properties in coastal towns as the salty air means that maintenance needs to be carried out more often.

Buying a holiday home does have a few fundamental differences to purchasing a family home. You need to think clearly about the house rather than following your heart. A beautiful home tucked away may not have the same appeal to holidaymakers as one with magnificent views near restaurants and shops.

Buying a holiday home needs to be a strategic move rather than an impulse buy. Never rush into a purchase, even if the offer seems too good to pass up. Similarly, don’t buy while you’re on holiday in the hopes of recreating the good times again in the future. Rather wait a few months and once you’re certain you’d like to buy a property in the area, go back with the knowledge from your research and find the perfect home.

Make sure you have the right rental agent

Keeping an eye on a holiday home and making sure it’s looked after is a hands-on job, so it’s essential that you have the right rental agent on board to do just that. Hire an agent with a good reputation and who has great contacts with local builders, painters and plumbers.

If anything goes wrong at the property, the rental agent should be able to act quickly and tap into the local supply chain to fix the issue as soon as possible. They also need to be able to secure a steady stream of holiday renters to keep your monthly income steady, especially during the off seasons.

Having a holiday home should be primarily for you and your family. Make sure to use it at least once a year to make the investment worth it. This way, you’ll also be able to carry out any necessary repairs yourself and keep an eye on the state of the property, making it more appealing to potential holiday renters.

Image credit: Joshua Oates

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Author: Seeff