Most homebuyers are in the market for a primary residence when making a home purchase. Still, some homeowners look forward to buying a second home that can be used for vacations, rental income, investment purposes or as the main residence during retirement.
In general, buyers of primary residences purchase homes because they want to become homeowners, have a change in family status or need to relocate for work. Buyers of vacation homes and investment properties are driven by different motivators. According to the 2017 National Association of Realtors (NAR) Investment and Vacation Home Buyer’s Survey, the top three reasons people buy a vacation home are to use the property for vacations or a family retreat (42%), to eventually use it during retirement (18%) and because the buyer simply found a good deal (12%). The top three reasons among investment property buyers is to generate income by renting the home (37%), to benefit from the potential price appreciation (16%) and to take advantage of low real estate prices – and, of course, good deals (15%).
Regardless of why you buy a second home, the process takes as much time research and effort as buying a home you’ll use as a primary residence. The good news is since you already have a place to live, there tends to be less urgency in the home-buying process and more time to wait for the perfect opportunity. To help you get started, this guide introduces the basics of vacation-property ownership, from important considerations to financing options, overseas transactions and property management.