The decision to buy a second home is always an exciting one because of the prospect of being able to temporarily live between two homes. There are however, a few things that you should be thinking about before jumping in and buying a home and in this article, is going to be some advice that you should take into consideration.
Location. It’s easy to fall in love with a country when you go on vacation and want to have the chance to be there as much as possible. Before going ahead and buying yourself a home in this new and exciting place, make sure you look at everything that it’s going to entail before doing so. These are things like:
- The cost of living there, will it break the bank?
- Some countries don’t have safe water in the taps to drink, are the amenities close by that you can get to?
- Think about the home insurance there, and how much that’s going to cost you. Is the location prone to hurricanes or earthquakes? If so, your insurance is going to be higher.
- If this is somewhere that you plan on permanently moving to when you retire, is the area somewhere that’s going to be suitable for you when you’re older?
Affordability. Look at the prices of mortgages in the area and decide whether that is an amount that you will be able to keep up, especially if you’re going for an executive condominium. These are usually owned by many different people and the upkeep of the ground surrounding it will cost you as well. Take a look at http://www.propertyguru.com.sg/singapore-property-resources/singapore-condo-guides/executive-condominiums-in-singapore for more information on executive condominiums, and the benefits of owning one.
If you’d rather go for a property that’s separate like a detached house or bungalow, then make sure you take into consideration any improvements that need to be made to the property before it’s liveable. It’s often the cheaper option to buy a derelict building and do it up from scratch rather than buying one that’s already decorated.
Renting it Out. There will be months of each year where you’re not living there, and renting the property out is a great way of making sure that your home is lived in and not left empty for many months at a time. It could also be a great way of making extra money. Depending on the location of your second home, you could be charging a lot of money for people to use it as a vacation home for a few weeks.
Keep in mind that any money that you earn from property, even if it is abroad needs to be declared so that you don’t get caught up with the tax system in a bad way.
Upkeep. Take into consideration the possibility of things going wrong with the property while you’re not there and how you would go about getting these things repaired. Make sure that you take some numbers of local handymen, electricians and plumbers that could go and make repairs to your property if necessary.
Again, the price of all of this comes into play too. Would you be able to afford the payments if something major went wrong like a big leak or electrical faults? Make sure that you’d always have money aside ready for disasters like these.
A good idea is to make sure that any repairs that need doing are completed while you’re staying there. This way, you should be able to avoid most things going wrong when you’re not living there.
Area. Before making any purchase on a home, be sure to properly check out the area so that you can make sure that it’s an area you’d like to live in. Speak to the locals and get to know what kind of atmosphere to expect. Make some friends beforehand so that you’re not so isolated when you do decide to move over there. Another good idea is to visit the place when tourist season is over to see how you like it when the area is quieter.
Don’t forget that many exotic countries close up shop once tourist season is over, so make sure that you will still have access to everything you need like food and the bank.
If you have small children, are there schools nearby that they would be able to attend? Make sure that you’d be able to send them to a school that can provide the education that they need, especially if you’re going to be living there during school terms.
Shared Ownership. Opting to share the ownership of the property that you’re interested in is another route that you could go down. Maybe a family member or friend is interested in having access to a second home too. This would dramatically reduce the costs that you will be paying, and take some of the load off your back if something does go wrong. Of course, you could speak to an estate agent over there to see if anyone else is looking to go into shared ownership of a property, but be wary of sharing with strangers, and always make sure you keep things above board by going through the estate agent to avoid any confusion.
The downsides are that you will both have to agree on things like renting it out, and who is going to be staying there and when. Also, when things do go wrong both parties will have to dig into their pockets to pay, so making sure that you have the money is still essential.
So there we have it, 6 things to think about when you’re considering buying a second home. Remember to check out everything before making any purchases, because you don’t want to be stuck with a property that you no longer need or want! Enjoy your second home and the benefits that it reaps!