For those who have achieved enough financial success to consider it, the purchase of a second home is a highly popular investment made by many in the real estate world. Second homes can serve several different purposes, including those that continue to benefit you financially, and it pays to know all the various routes you might take before you jump into the market.
At Primary Residential Mortgage, we’re proud to provide a wide variety of mortgage loan programs, from conventional loans to jumbo loans and more — including assistance for those considering the purchase of a second home. Why might you be thinking about going this route, and what are some of the important considerations you should be making while doing so? Part one of this two-part series will focus on the former, while part two will dig into the latter. Here are some of the common reasons people consider second homes.
For those who still have living parents who may need some assistance as they get older, a second home is often a perfect route to go. Many who have the funds will purchase a second home for their parents that’s close by, so they can spend time with them when needed. Even if you don’t live in the same city, maintaining a close relationship with your parents is vitally important to many people, and this may be one of the most common reasons for purchasing a second home.
As you start this route, it’s important to think about how much space you’ll need, which can vary widely. Do your parents still live alone? How will they handle the upkeep of a second home without assistance? There are several different variables involved in this situation, so it pays to plan carefully before you jump into it.
For some people, the purchase of a second home is more about creating the perfect vacation destination than it is about long-term assistance or living arrangements. Many people purchase second homes that are virtually all-inclusive, so that they can enjoy a variety of activities on their dime whenever they choose to travel. If you have a yearly vacation spot you know you’ll never get tired of, a second home in this location might be ideal.
Whether on its own or combined with the above themes, a second home can also be a direct part of your retirement planning. Many people who are planning to retire in the next few years won’t necessarily want to stick around where they currently live, and purchasing a second home before retirement can save them considerable time and hassle.
This may work well for those who have vacation homes they’ve visited and enjoyed previously, or it might be a strategy designed solely with their own interests in mind. In some cases, you can even hold onto both homes for some period of time after retirement, renting out the one you don’t live in for additional income.
*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Opinions expressed are solely my own and do not express the views of my employer.