Purchasing a vacation home can be exciting when you consider that you will have a place to go anytime that you choose to do so, but along with the advantages, there can be disadvantages. Following are some drawbacks to purchasing a vacation home with your same sex partner.
Unless you have the money to purchase a vacation home outright, you will have to pay a mortgage. Generally, the required down payment and mortgage interest rate will be higher on a vacation home than it is on your primary home. In addition, your homeowner’s insurance will likely be higher because of the risk involved in the home sitting vacant and, depending on where the home is located, in natural disasters.
Most people look for vacation homes in popular areas where they like to visit such as the mountains, the beach, or near golf courses. Because those places are popular, the cost of purchasing a vacation home may be much higher than you have anticipated and your mortgage payment may end up being more than the home that you live in.
Renting the Home to Others
Many vacation homeowners prefer to rent the home out for periods varying from a few days to weeks in order to recoup some of their expenses and to avoid leaving the home sitting vacant for extended periods of time. If you rent your vacation home to others, the Internal Revenue Service, requires that you pay taxes on that income. If you used the home for personal purposes, but not as a home, you must report your rental income as well as the expenses on your tax return. You will be required to divide the expenses you incurred into rental use and personal use. The personal use expenses are not deductible in your rental expenses. If you rented the home less than 15 days out of the year, you are not required to report the rental income or the rental expenses. Your mortgage, interest and property taxes should be reported as you normally would on your income taxes.
Your vacation home, just like your primary home, will require maintenance. Many people choose to leave the home vacant when they are not visiting so that it is always available for their own use. If you live more than two hours away from the home, the chances of you being able to visit the home very often to check on it and take care of any maintenance that is needed are slim. If you cannot afford to hire a caretaker, you can expect part or all of your vacation time to be spent on home maintenance.
How Much Can You Afford
Before you look for a vacation home, you should decide how much you can afford to pay, and the amount that each of you will contribute to the mortgage, taxes, insurance and upkeep on the home. Even if you intend to rent your vacation home to others during the times that you are not using it, you should not count any rental income in your calculations. It would be best to ensure that you can afford both your primary home and the vacation home from your own incomes.
If you are ready to look for the vacation home of your dreams, contact a professional LGBT real estate agent. He or she will help you through the entire process of locating and purchasing your home. You can locate the best LGBT agents located in the area you are considering making a purchase by conducting a search on GayRealEstate.com. There is no fee or obligation. For more information on hiring a real estate agent, see our article Top 10 Reasons to Hire a Gay Realtor for Your Home Purchase.