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6 tips for buying the right vacation home

Vacation home sales surged in 2013, the latest year available, according to the National Association of Realtors. They made up 13 percent of all residential transactions last year, the highest market share since before the housing crash in 2006. If you're on the market for a vacation home, here are some issues to consider, as laid out by agents and others knowledgeable about real estate:

Beware joint ventures: Ideally, one person or family will buy and use the home.

"If you involve friends or family members in a joint venture, be cautious and have an attorney to draft a partnership agreement," said Phil Immel of ImmelTeam Luxury Real Estate in California. "Human nature changes business and family relationships. Divorce or financial change of circumstances over the years can get messy."

If there's more than one party involved, he advised, have a buyout agreement in advance.

Also, you would have to figure out who signs the loan documents. Some or all of the partners? The fewer involved, he said, the better.

Consider renting it out: If you're buying in a beach town and thinking of renting the home when you're not there, get close to the water. Agents say walking distance is most in demand.

If you are considering becoming a seasonal landlord somewhere, make sure you are clear on any rental restrictions, either by the city or a homeowners association.

Figure on extra costs: Think about how you would handle the business of rentals, including whether to hire a management company. Have a team of people lined up to do repairs and manage the property. Even if you don't share your getaway with tenants, remember to factor in such costs as utilities, maintenance and landscaping.

Make it a trouble-free trip: Many people prefer a relatively short trek to their second home, so buying something that's between a 45-minute and a couple-of-hours' drive from your primary residence can be a good idea.

Pick the right beach: Buying a house along the beach brings its own set of decisions. Do you want a busy beach or a quiet one? Do you want to be closer to the water or farther away?

Also, determine the size of house you want. If it's on a beach, do you really need a big house? After all, you'll likely spend most of your time outside by the water.

Don't isolate yourself: If it's isolation you're after, that's fine. But be aware of the financial implications. Agents say that being an outlier can limit a vacation home's resale potential. A remote location could make it more difficult to sell the property.

Buyers typically want to be near such amenities as restaurants and shopping, she said.

6 tips for buying the right vacation home 08/07/14 [Last modified: Thursday, August 7, 2014 6:30pm]
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