Is Second Home Ownership In Your Future?

According to the National Association of REALTORS® (NAR), a record 2.82 million second homes were sold in 2004. Given attractive interest rates, a strong housing market, and the increasingly mobile lifestyle of North Americans, it comes as no surprise that the resort and second home market is enjoying steady growth.

For some, purchasing a second home is a financial strategy to help them grow and protect their wealth -- and certainly vacation getaways may provide rental income opportunities to help savvy boomers offset the expenses of second home ownership. Others may be motivated to buy a second home because it can be used as a "family retreat," to be later transformed into a residence after retirement, and then handed down as a family legacy. Here are some interesting statistics from the NAR 2005 Profile of Second-Home Buyers:

The typical vacation-home buyer is 55 years old with a total household income of $71,000.

Investment-property homebuyers have a median age of 47 years with a typical household income of $85,700.

33 percent of vacation homebuyers wanted a second home close to their job or school; while 24 percent wanted the home close to their primary residence.

Nearly one out of five second homes will become primary residences after retirement.

Because technology affords the freedom of telecommuting and "working where you play," the decision to own a second home or resort property has been made easier than ever before.

If purchasing a second-home is in your future, whether as an investment or for personal use, now is the time to get the information you need to make an informed decision. A qualified real estate professional can help guide you through financial considerations, assist you in finding the right community and even refer you to a resort property specialist for the destination of your dreams. Your real estate professional may even be able to get you the information and advice you need to use the equity in your current home to finance the down payment on a second home.

If you are planning to use your second-home as a vacation retreat, make sure you consider your needs. Are you looking for a secluded location in the woods or somewhere with an active community? Natural beauty is great, but don't forget about cultural and social resources, as well as first-rate golf, tennis and other popular sports facilities when scouting locations. And what about location? For example, buyers from the Northeast are the biggest feeder market for second homes in the South. Many San Franciscans retreat to Lake Tahoe, while Bostonians gravitate to Cape Cod. However, there may be many great locations not more than two to three hours away from your home. You will likely get more enjoyment out of a property you can get to quickly and frequently. Since you know the area, chances are you'll make a better real estate investment closer to home.

If your second home is mostly for investment purposes, ask your real estate professional about property management options, which can be a crucial financial factor, as well as important to peace-of-mind.

Location is also a factor for those buying a second home as investment property, especially if appreciation or rental value is your goal. According to the NAR survey, the median distance between the primary residence and the investment property is 18 miles; and 44 percent are in the suburbs.

There are also tax implications to consider with your investment. If you rent your home for 15 days or more in a year, you may have to declare the rental income. However, your expenses may be deductible. You'll want to confer with your tax advisor to learn how your purchase will affect you financially.

How you use a second home is up to you, but make sure you look at each property with an eye toward tomorrow, because the vacation homes likely to appreciate the most are the ones that Baby Boomers can play in today and retire in tomorrow.

Neda Dabestani-Ryba is a licensed Realtor in Maryland. She is a member of the President's Circle of Top Real Estate Professionals. She can be reached at (800) 536-3806 or visit her website for more information: http://neda.dabestani.pcragent.com/

Prudential Carruthers REALTORS is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity.

---

Tax Free Exchanges: Watch out for the New Residence Rules

On October 22, 2004, President Bush signed tax legislation that... Read More

Selling Houses: Design Psychology and Interior Colors

Interior colors are vitally important to selling your home quickly,... Read More

Real Estate Bubble: Sophisticated Musical Chairs?

The real estate bubble is a hot topic today; annual... Read More

Minneapolis Warehouse Loft

Downtown Minneapolis is rich with true metropolitan charm. With the... Read More

Staging Homes for Top-Dollar Sales

Wouldn't it be nice to have Roger Hazard's design team... Read More

Are You Profiting From O.P.P.?

Are you profiting from O.P.P.? If not, why not? We... Read More

Landscaping Adds Great Value to Real Estate And Helps You Sell

Over the years several of our clients have had professional... Read More

Apres-Ski

European tax haven Andorra enjoys the same fiscal benefits as... Read More

How To Get More Money For Your House

If you are thinking about selling your house, you should... Read More

I Already Have an MLS Listing, Why Do I Need an Internet Ad?

In today's real estate market, astute buyers are also looking... Read More

Santa Visits a Just-Moved Newcomer in South Florida

Twas the night before Christmas and all through the house... Read More

San Antonio Texas Real Estate

The San Antonio, Texas real estate market is still going... Read More

3 Tips to Help You Sell Your Timeshare - For More

The values of timeshares are constantly changing. There are numerous... Read More

Sell Your Income Property For More

Selling income property isn't like selling a house. You can... Read More

The Many Ways To Profit From O.P.P.s Multiple Cash Streams

In a previous article we introduced you to the concept... Read More

Dramatic Profits From Preconstruction Real Estate Investing

The preconstruction process is an innovative real estate investment opportunity... Read More

Finding The Perfect Maui Home For Sale

If you are thinking of relocating to Maui, this article... Read More

Sellers, Are You Having A Hard Time Selling Your Home?

Sue and Chuck DeFiore have the perfect solution for you... Read More

Selling Your Home ? What Can Go Wrong With Title and Lenders

If you're selling your home, there are going to be... Read More

The Sadness of Old Buildings

From the book No Smooshing!For years, I've carried on a... Read More

Dead Deals and Recycled Reports

Everyone knows that at the end of a home inspection,... Read More

Why Mobile Homes?

There are mobile homes for sale, for much less than... Read More

How To Build A Million Pound Property Portfolio

Looking to quickly build a million pound property portfolio? You... Read More

A Simple Step by Step Aproach to Fail Your Way to a Million Dollars

If You want to be Financially Successful you need to... Read More

Get Rich With Mobile Homes

Does the myth that mobile homes depreciate in value keep... Read More

How to Make the Real Estate Market Work For You and Get The Most Money

How to make the Real Estate market work for you... Read More

Real Estate Investing - The Marvel Of Home Depot And Lowes

Repairing a rental home (or your own home) use to... Read More

Selling by Owner Tips

Do strangers scare or intimidate you? If you're planning to... Read More

Time Is A Major Real Estate Wealth Growth Tool, So Use IT And Watch Your...

In Real Estate "Time" is a Wealth Development ToolsReal estate... Read More

I Believe God Wants Me To Tell All In Real Estate

After years of experience in the real estate industry I... Read More

Chapter One FSBO the Russ Miles thriller/mystery novel

Chapter OneShe reached the phone on its second ring. "This... Read More

Real Estate Investing and Home Ownership

If you already own your home, you will probably make... Read More

How to Qualify For 90% Plus Commercial Financing!!!

There are three important questions that you must understand and... Read More