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5 Reasons Not to Own a Vacation Property

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We just put our vacation home on the market. The children are involved in sports and weekend activities making it difficult to get to the mountains. I can still remember the excitement when we purchased the property sixteen years ago.

We had babies.

And visions of teaching our children how to ski, bike ride and summer sailing; cool breezes away from the city and a beautiful pool with outdoor living. Yep, those were the dreams and our reality. Now, it sits empty most holidays and weekends. No kids screaming in delight while stick sword fighting for control of the boulder outside our patio. Now, the boulder seems like a little rock.

We buzz up the mountain to ski and buzz back down to attend a pressing event. I look across our house and see teenagers deeply engrossed in computer screens. Yes, we did have some wonderful family memories…but would I do it again?

No…and here are my five reasons not to own a vacation property:

1. It prevents you from exploring other places. We got locked into vacationing in one place long after the children lost interest. The ongoing financial outlay can prevent you from enjoying other beautiful venues. Our teenagers now prefer more privacy than our cozy vacation home, that seemed the perfect size when purchased. Tastes and family interests all can change.

2. It’s another expense. A second home takes away from your operating budget and reduces your cash flow. You essentially have double expenses from possibly a mortgage, taxes, utilities, cable, insurance and so on. Where else could this money have been directed? College funding? Paying off other debt? Emergency fund? Care for an elderly parent? Home improvements on your primary home? What could you use that money for back home? Disposable income and a stable job is a requirement because are locked into additional “fixed expenses”.

3. Bad things happen. Since your vacation home may go empty for weeks or months disasters may occur. Depending on the location - hurricanes, floods, fire or even break-in. The hot water leaks or someone decides to wax skis on your new carpet all result in unexpected expenses. You may have a property manager to help mitigate some of the above, but you also pay them to fix the problems.

4. The value can go down. Real estate does not always go up and vacation homes should not be purchased as an “investment”. The monthly out-of-pocket costs can quickly erode any appreciation you may experience over the years. A vacation home is a “lifestyle” choice. Do not convince yourself otherwise.

5. Rental income is no guarantee. It is true that a week or a month at a time rental, during peak season, could provide an annual mortgage payment. Unfortunately, that is usually when you want to use your property. Plus, you may pay a property management company 30 - 50 percent of your rental income. Recessions usually impact these resort markets, can you handle the payment if you received no rental income?

A chapter ends for my family. Hey, you interested in a beautiful Colorado Rocky Mountain vacation home…I have just the property!

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