Is Buying a Vacation Home Worth It?

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When it comes to taking that much-needed vacation, sometimes we’re not really in the mood for the crowds and bustling bars and clubs. There are times when the usual amusement park and hotel combo just don’t measure up to what we need.

If we could, on those occasions, many of us would hop on the first shuttle to another planet. However, that’s just not impossible, yet. So, the next best thing, at least we think it is, is to own a vacation home.

Be that as it may, many are finding that little piece of peace and quiet might cost them more than it’s worth. Below are some reasons buying a vacation home might not be the epiphany you thought it was.

Added Mortgage

If you own your own home, you are familiar with the process of purchasing a one. It’s very time intensive and expensive. You have to meet certain criteria to even be eligible to buy one. Unless you carry enough cash to pay for it outright, you need good credit, good references, and one heck of a down payment.

After all is said and done, there is interest, taxes, and closing costs. Want to buy another house? Simply repeat everything above. Except for this time, your credit rating will have to be even higher and so will your down payment. The banks know as well as we do that having two mortgages can drain any wallet. (One actually does is well enough for most.)

Now, if you are the type of person that can maintain a savings account with $10,000 in and draw a wealthy paycheck on a regular basis, this may be a walk in the park for you. For most, however, buying a vacation home will be a very tall order.  


When you leave for that weekend getaway or go to spend a week at the beach with the family, there are some things at home you have to make sure are taken care of in your absence. Pets need to be fed and taken care of, the security of your home needs to be attended to, mail picked up, trash needs to be taken off, and the lawn mowed.

That’s just if you are gone for a short period. Now, think about that extra vacation home. How much time will you really spend in it? Not much in comparison, but you will still have to keep it up.

That means keeping the lawn cut and manicured, keeping the house cleaned, paying electric and water bills, any homeowner fees, and paying the salaries of the people you will have to hire to maintain all of it. Unless you spend at least half the year in your vacation home, spending the extra money is equivalent to setting it on fire. You money boat seems to have a leak.

Investment is Rocky

As an investment, a vacation home is a roll of the dice. Even if your second house is in a well to do part of town if the housing market crashes like it did a few years back, demand will tumble with it and so will your vacation home’s resale value. As the demand falls, so does the resale price of your second home.

Have you thought about using the equity in your vacation home as a retirement fund? Might not be the best idea. Even if it carries equity, should you need to tap into that in your retirement years, it more than likely won’t be the quick fix you need.

The idea of a vacation home is definitely attractive until you see the bill. So, it really comes down to whether or not you make enough money to cover the hole in your pocket a second house will create. Feel free to refer to this article to help you decide.

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