I met a good friend for coffee when he asked me what I thought of taking equity from a principal residence and using it to purchase a vacation home.
My knee-jerk thoughts were, “Don’t do it!” I look at real estate purchases other than a principal residence as an investment and a vacation home, in my opinion, is not an investment. But, I inquired with him further.
He considered a vacation home as a place you can call your own to enjoy with your family who would look forward to going to relax and unwind.
I started getting passed my objectivity, then reality struck. I explained to him some things to consider from a financial aspect, including potential tax consequences in owning a vacation home.
I thought it would be best if I highlighted several factors to consider when purchasing a vacation home.
Buy in a location you enjoy
Enjoying the area and finding it to be your frequent go-to vacation is probably the main reason for considering a purchase.Read More