What to Know About Buying a Second Home
2018 is looking to be a ripe year for home buyers, especially those looking to purchase a second home. However, you don’t want to leap right into it and sign on the dotted line without understanding the market you’re buying in first and finding the home of your dreams! Read on to learn more about buying a second home so that you’ll be properly prepared to take that leap.
Think about the different types of homes
There are plenty of options when it comes to buying your weekend getaway, investment property, or future retirement home. From condos to townhomes and on to single family homes, the options are endless. Condos and townhomes offer a lock and leave option while single family homes ranging from two bedrooms and upwards offer a little bit more permanence and privacy. If you’re looking for a place for your whole family to enjoy and multi-generational use, a multi-story home or expansive beachside mansion might be ideal for you. Then you need to ask yourself if you want to wake up to the water every day or are looking for a place that’s more inland.
What goes into the cost of a second home?
You may be thinking the cost of your second home is simply the sale price. However, there are some additional expenses that you should factor into the equation when planning your finances for your second home.
Securing a mortgage
Before approving your mortgage for a second home, lenders consider your debt-to-income ratio, which is how much money you’re paying on debts, like credit cards, student loans, or current mortgage payments, compared to how much money you bring in with your job. The bank is just analyzing how capable you will be at repaying this additional loan in a timely matter.
Insuring your second home
It’s common that insurance companies view your second home as a risk due to the fact that you will not be residing there full-time. These risks will make your insurance for this second property a little higher than the insurance you’re paying on your primary residence, and there will be additional coverage expenses if you plan on renting your second home out when you’re not there.
Plan for maintenance costs
Since you won’t be living in this house every day, you won’t be able to keep up with small maintenance tasks that you normally do at your primary residence. You should plan to factor annual maintenance into your budget in order to hire someone to take care of the small or large problems that arise when you’re not on site.
Make sure you’re in love with the area, but don’t jump the gun
If you’re going to purchase a second home, you should love the neighborhood you’re a part of just like you do with your primary residence! Even if the location you’re looking at has been your vacation spot for years, take a good look around the area as a non-tourist. Take a stroll around the block and get a feel for your potential neighbors, or visit the different places you would normally go in your daily routine. You should even try to visit the area during the off-season.
We say “don’t jump the gun” because you shouldn’t go on a vacation and come home with another home’s keys in your hand! Purchasing a second home takes time and you want to do some thorough research about the market, location, and your own budget before making the big purchase.
You should hire a real estate agent that knows the area
You’ll want someone helping you through this process that’s local and understands the housing and second home market. A local real estate agent will be able to give you information about the neighborhoods and find a home that matches your wants and needs, like if you’d like to be close to the golf course or want a beautiful view of the water. An agent will prove beneficial, especially if you’re trying to search for your vacation or retirement home while miles away in your primary home.
If you’re looking for a second home in a beautiful location, consider Fripp Island. The island life will provide you with that small town feel and paradise-like scenery, offering both a quiet getaway and a smorgasbord of fun activities. Fripp and Harbor Island Properties has plenty of properties to show you that will fit your needs and your budget, and also comes equipped with the best real estate agent in the business, John Lee. Lee will share this beautiful location and, more importantly, his expertise with you to find another place in this world that you can call ‘home.’