Should You Buy or Rent A Vacation Home?

The three rules of real estate, location, location, location, should be imagined with 20, 30, 40 or more years into your future.  Image your future self.  Where do you want to live?  How do you want to spend your leisure time now and decades into the future?

You might think to yourself, that you don’t need to plan to live in the same location for decades, since you could sell your current home and move.  However, there is no guarantee that the real estate market will be favorable when you want to move.

Our Florida Snowbirds will agree that if you are in a financial position to buy a vacation home in your ideal retirement location, then you will have your preferred lifestyle option for decades to come.

Envision your home.  Where is it?  What does it look like?  Do you mind living in close quarters with others, or do you prefer detached homes?  What is the smallest size home that will be acceptable to your future life style?

Calculate your budget then divide by half, if you are planning to buy new construction.  If you are planning to buy a fixer-upper, divide by half again, unless you are able to do most of the work yourself, or the home is in rentable condition and currently has long-term tenants.  Another consideration is the time you have available for construction or overseeing tenants.

After you determine where you want to live when you are retired and your available funds and time constraints, take out a map of the world and put a pin in your perfect location.  Draw a circle around the pin that would extend out ten miles from the center.

Rent a vacation home in that area at least once.  Spend as much time as possible inside your circle.  Shop in the local markets inside your circle.  Mail a letter from the local post office.  Get to know the roads, the people, the weather, current home prices and the homes’ zip codes.  Talk with as many people as you can meet inside that circle.  Buy a copy of any neighborhood association(s) documents for the areas that you are considering.  Read as many blogs as you can find written by people who live inside the circle.

Now that you know your preferred neighborhoods and their zip codes, then do a computer search using websites such as  The final step is to contact a real estate agent.

Although it is possible to earn income from your vacation home, never depend on this income.  It is not a good idea to have your home vacant for more than a few days.  If you do not have a large enough family to occupy a vacation home year round, then just save your money until you are closer to retirement or add house-sitter expenses to your budget.  Added to normal home ownership expenses, a vacation home will bring many extra expenses including non-resident property taxes, legal fees, possible short term rental taxes and management fees.

With the ups and downs of real estate, never consider a home or condo to be a financial investment.  If you are able to make the choice to buy rather than rent, home ownership is a life-style choice and a blessing,


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