When the time comes to start considering where we'll be spending our golden years, most of our thoughts immediately turn toward tropical temperatures, and with good reason. Southwest Florida, and especially Cape Coral properties leave nothing to be desired. You've got your pick of golf course properties, Cape Coral waterfront boating communities, nearby beaches, and the perfect weather to enjoy all of your outdoor activities.
Okay, back to reality. Once you've got your dream vacation home in your mind, it's important to take a look at the feasibility of bringing this dream into reality. Here are some facts for you to consider when deciding on the purchase of a seasonal home here in Southwest Florida.
Seasonal / Vacation Homes a Sound Investment in Today's Economy?
Earlier this year, The Wall Street Journal's Smart Money, an online financial magazine, advised that the current mortgage rates coupled with some of the lowest home prices in decades, make investing in real estate a smart move for those planning for retirement.
Liz Pulliam Weston, staff writer and money management expert at MSN Money agrees, as long as individuals looking toward retirement are willing to put in the effort to rent their home during the months they aren't vacationing, a retirement home can pay for itself. The three rules of thumb include:
- Finding a reliable property manager or cutting out the middle man altogether if possible.
- Renting the property at least 15 weeks out of the year in order to break even. This figure is based on the assumption that one week's rental income will be equal to one monthly mortgage payment. Of course, you may need to make adjustments to this figure.
- Properly advertise your vacation rental by using the internet to reach the widest possible audience. This is by far the most cost effective form of marketing.
Considerations for Second Home Buyers
Another attractive feature of purchasing your second home now is the fact that you can write off property taxes and mortgage interest as well as a percentage of your other expenses, such as maintenance (think lawn care and monthly pool maintenance fees) along with a portion of your utilities. In the event that you aren't able to rent the property out as planned, you may be able to write off up to $25,000 in rental losses as well, depending on your annual income.
The bottom line? You can get a head start on your retirement by purchasing your Cape Coral property now, locking in a low interest rate, and using your second home as a vacation rental so it can pay for itself. That's smart planning.
If you have more questions or are ready to start exploring Cape Coral properties, please give our office a call. We know Cape Coral and will be happy to assist you.
By David Sporleder | Sporleder-Ray Realty Group | firstname.lastname@example.org| Google+