The holiday-home romance
It’s easy to fall in love when you’re on holiday. With the destination and the lifestyle, that is. Generally, it’s easy to fantasise about buying a holiday home—but before you jump in, consider these words of advice from Ya’el Geffen, executive director at Lew Geffen Sotheby’s International Realty.
“Remember that no matter where you are buying, whether it’s on the coast or in the bush, the most important rule of property investment is location,” says Geffen. “You want to make sure that the property you buy has potential to yield good returns.”
The goal is to buy a property that will appreciate in value and be easy to sell when the time comes. To make a good return, you will need to rent out the property for a couple months at a time, and in peak season. You’ll also want to ensure that it has universal appeal and that it is in a desirable location, close to typical tourist amenities.
“From an investment and rental-potential perspective, it is important to know a bit about the local housing market. You should understand what attracts holidaymakers and investors to the area, whether this trend is likely to continue, and what property values and rental prices are doing,” says Geffen.
She points out that buying a property is more than just a financial commitment. A holiday home requires maintenance and upkeep in the same way as your own house does. This is important to remember. If you live in another region, you’re not going to be around often enough to make sure the property is being maintained properly.
When you’re on holiday, you don’t want to spend all your time on maintenance and repairs, so it’s wise to choose a low-maintenance home that is solidly built with durable materials that are suited to the climate. An old fixer-upper is not a good idea for a holiday home unless you’re going to be there frequently or have a team of staff in place around the clock.
Consider security, too. You don’t want to go on holiday only to find your property’s been burgled. With this possibility in mind, you might want to consider a property in a secure estate or complex, rather than a freestanding beach home.
It makes sense to chat to an estate agent who knows the area and can offer sound advice, not least on the tax implications of buying a second home. So before you jump in, make sure you’ve done your homework.
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