Friday, April 4, 2014
There are many types of real estate investments that cater for different investors’ financial situations, requirements and preferences. Finding the right type of real estate investment may be a worthwhile income-earning endeavor. Vacation homes are often thought of as luxury real estate, but these properties may also earn income through rent.
As with any real estate investment, location is a key factor for many advantages. The location you choose to buy in could result in lower expenses such as property tax rates and homeowners association dues. It could also affect the income and value of the property, as certain locations are more desirable for renters, and prime locations tend to appreciate more over time.
Before committing to a property location, consider the travel time and expenses involved, as these will affect the costs you incur.
The primary source of income available for vacation home investments is rental. The peak season for vacation home rentals are during holidays and weekends. As a vacation homeowner, remember that you may have to forego spending some time at your own vacation home if you decide to rent it out. Another consideration is the cost involved. Bad tenants may get away without paying rent while vacancy periods will leave you without any income for months on end. And property damages from wear and tear, as well as careless tenants may also be incurred.
For many people, having a private vacation home is a luxury incomparable to staying at hotels or resorts. For this kind of investor, who would like to use the vacation home as their regular weekday retreat, it could be a worthwhile investment and opportunity to earn an income as well. However, for those who are primarily looking for a real estate investment to earn income, there are other types of investments that can better fulfill your goals.