May 18th, 2011
Have you always wished you had a cabin at Sugarloaf Mountain, or a cottage near Sebago lake? Now may be the ideal time to purchase that vacation home!
In the CNN Money article, “Want a vacation home? Prices are falling” Les Christie points out that families who previously could not afford a vacation home may now be able to with the sluggish housing market. Christie writes,
The median price of a vacation home was $150,000 in 2010, down 11.2% from a year earlier, the National Association of Realtors reported Wednesday. In contrast, the national median for primary residences fell only 4.5% in 2010, according to NAR.
One down side that Christie points out is that it may be more difficult to get a second mortgage. Those who did get the second mortgage often found that the amount necessary to put down was higher than their first mortgage. Christie says, “For vacation homes, the average was 30%, far more than the standard 20% down.”
But, if you can get approved for the mortgage and afford the money down, it’s well worth it to buy now.
Plus, there are incentives besides having your own place to get away to on the weekends. One perk is the ability to rent out your vacation home when it’s not in use, which then can go towards paying off the mortgage. According to Ella Zhang in her USA Today article, “As vacation home sales stall, owners turn to renting” , homeowners earn more than $35,000 on average in annual income by renting their properties. Home rentals, versus, hotel rentals, tend to be more cheaper and more appealing, so the demand is always there.