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Make your second home pay
By | February 15, 2008
A lot of people buy second homes but they stop after that. It is great to have another home, but there is a lot of spending on it including a second mortgage, cost of upkeep etc which is never easy to manage. For this very reason, many smart folks rent out second homes so that some of the cost incurred on the house is recovered through rent. If you plan out the whole thing properly, market the house well and use some common sense, owning a second home can be one of your best decisions.
What you should do first is a little research upfront. You should be aware of the things that attract people who are looking to rent, the rents for comparable houses in the neighborhood, how many people the house can accommodate, the features and facilities etc. This information can be obtained from a real estate agency or also with associations that own property and also various websites.
The next thing that is to be done is to do the math. Add up the costs that you have and will incur on the house and also add a buffer of 10-15% to be on the safe side to cover your losses, if any. This will help you figure out whether it will be profitable at all to rent out your home and what percentage of your investment you can recover through renting it out.
The final step is to let people know that your house is up for rent. The common, easy and effective method these days is to set up a website and advertise on it or advertise on popular websites. This will get you good exposure and it is cheaper than most other alternatives. There is however a requirement that you stay in the house for a minimum of 15 days a year for it to be called a second home and not something you bought as an investment.
Topics: Mortgages, Uncategorized |