vacation rental property

8 Things to Consider Before Buying a Vacation Rental Property

You’re just back from an incredible vacation, feeling rested and refreshed. You start to wonder: Is it possible to have more of that feeling while also generating some income?

While it is an appealing investment strategy to own a vacation rental property in an area you love to visit, there are some things to think about to ensure you make a smart investment decision.

Here’s what you’ll want to consider:

1. Set your budget

Your first step should be setting aside some time to review your finances and determine what your budget is for your future property. This is one of the most important things in preparing to purchase a vacation home. You will also want to keep in mind, your budget is more than just the cost of the property. You will also want to factor in items such as:

  • Closing costs
  • Taxes and Insurance
  • Utilities
  • HOA and condo fees
  • Furnishings and seasonal items that make a vacation rental property attractive such as kayaks, jet skis or snowmobiles, boats, beach gear, coolers, and so on.

2. Choose a location

Think about the experience you are hoping to create for yourself and your guests with your vacation rental property. Are you looking for a peaceful, quiet retreat or somewhere in the middle of it all? If you live in a cold climate and want to enjoy the Caribbean several times a year with your family, Selva Escondida may be a perfect fit for you. But if you already live in a tropical area, a snowy, mountain escape may be what you are looking for.

selva escondida puerto morelos

3. Learn about rental requirements for your new property

If you are planning on financing the purchase of your vacation home, keep in mind that the lender may require that you obtain an investor type of loan rather than a conventional mortgage. If you have your eye on a condo or townhome at Selva Escondida, we have trusted financial partners that can assist you with financing, and plans to rent out your home do not impact the loan in any way.

It’s also important to check for any restrictions on using the property as a rental unit. You can get this information from your real estate or sales agent. Our state of Quintana Roo has no restrictions on renting out your home.

4. Know what rental income you can expect

If you are counting on the income the rental generates to offset the cost of the property, you’ll want to do some research into the vacation rental market in the area where you plan to buy your vacation home. Many factors influence rental prices including its location, amenities, and how it’s furnished. You’ll also want to get an idea of additional costs associated with renting out your property such as advertising, property management, and maintenance.

vacation rental property

5. Protect your investment

Regardless of the location of your property, it’s never good to leave your home away from home unattended for long periods. Here in the tropics, humidity can create problems. And in colder climates, a burst pipe can cause considerable damage in a short time. A property manager can not only assist with rentals, but they keep an eye on things, ensuring you catch any potential problems right away. If you are considering Selva Escondida, we have some trusted property managers we can recommend to you.

6. Be prepared for taxes

Taxes may not be anyone’s favorite subject, but it is good to be prepared. You can ask your sales or real estate agent about the area’s property taxes. You may also want to think about hiring an accountant who can assist with all the finances associated with your vacation home, including local taxes requirements if you decide to sell your home.

vacation rental property

7. Plan ahead to enjoy your own home

You can’t put a price on spending quality time in your favorite place with family and friends, so give some thought to scheduling time on the calendar for yourself. How many times a year do you picture utilizing your vacation rental property? When you retire, do you plan to move to the area and live in your home full time? These are all good things to think about before purchasing.

8. Make your dream a reality!

While it’s smart to consider all the information, be careful that researching doesn’t become procrastinating. We talk to many happy buyers who say that although it took courage to take the first step towards owning a vacation rental property, they wish they did it sooner while there were plenty of properties available and the before prices increased. That is especially true if you are considering one of our properties, as we are in the final stages of our development.

So why not reach out to us today? Our knowledgeable sales agents have helped many people purchase an incredible investment property in the Caribbean. Will you be next?

 
 
 
 
 
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Una publicación compartida por Residencial Selva Escondida (@selvaescondidamx)

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