Vacation home sales skyrocketed during the pandemic. Should you buy one?

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Demand for homes has skyrocketed during the pandemic. mortgage rates made this time more attractive for shopping. But buyers were eager to acquire more than just the primary homes. Vacation home sales also skyrocketed during the pandemic.

Vacation home sales rose 16.4% in 2020, outpacing the 5.6% growth in total existing home sales, according to the National Association of Realtors. Meanwhile, sales of vacation homes from January to April 2021 were up 57.2% over the same period in 2020.

What is fueling this trend? The fact that so many people get the green light to work remotely made holiday homes more attractive on a long-term basis. After all, why stay in the same house when you can move between two objects and enjoy a change of scenery?

Vacation homes have also served as a good rescue during the pandemic, especially for city dwellers, who may have gotten tired of being locked up in small apartments in many cases over the past year.

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Should you buy a country house?

If you have money to use as a down payment on a vacation home and are confident you can qualify for mortgagethen you may be considering buying a second property in the near future. But before you do that, ask yourself these questions.

1. Will buying a second home be a burden on my budget?

Perhaps you can technically afford to pay off the second mortgage. But will this lead to excessive financial stress or the risk of falling behind on other accounts? Make sure the vacation home fits your budget.

2. Is it worth paying more for a country house?

Housing is currently overpriced nationally, so if you buy a holiday home, you may be paying a lot more in the near future than in the regular housing market. Moreover, the big reason house prices are so high it is that the inventory is very limited. But inventory is even harder to find in some vacation spots, so make sure you don’t get stuck overpaying for properties that you will have to keep up with.

3. What is my goal in creating a vacation home?

Maybe you want to buy a vacation home so that you have a comfortable place to escape to when needed. Or maybe you are thinking of buying one as an investment. If the latter motivates you, make sure you buy in a renter-friendly area. Some holiday destinations have strict rules for renting homes for short stays, so talk to your local real estate agent who can help you determine how likely you are to receive a steady rental income.

As tempting as it may be to buy a vacation home, this is a decision you need to consider carefully before diving into it. And if you do decided to continue building your holiday home, don’t be surprised if it costs a lot more than expected.

Buying a second home may be a smart move, but you can also wait until the value of real estate will decrease slightly… Sitting around until next year can make a huge difference, especially if you’re buying this home as an investment more than anything else.

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