There are many reasons to invest in a second property. Whether you want a cozy vacation home, an income-generating rental property, or a house for your relatives to live in, there are some considerations you will need to make before signing the mortgage papers.
Goal-setting isn’t just for Tony Robbins junkies, it’s an important step in any large financial investment. How often will you be using this home? Do you want to make money off this property? Do you want to pay off the mortgage and live there for your retirement? Who will be paying rent? How long will they be living there? These are all questions you need to ask yourself as you develop your goals. Winging it isn’t an option when it comes to investments.
Now that you know what you want, it’s time to figure out how to get there. Expand your budget to include an extra set of utilities, insurance costs, and mortgage payments. Consider how you will save up for the down payment and how you will continue to maintain this second home. Also factor in possible tax advantages and the costs associated with being a landowner, if applicable. In this step, you will need to think long term. The bottom line: can you realistically afford two mortgages?
You have a goal and a plan, it’s time to start browsing the listings. Remember that the location, amenities, and size of your potential second home need to reflect your goals. For example, if you are planning on renting it out, ensure that it is in a desirable location where renters would actually want to live. This could mean proximity to schools, public transport, or a grocery store. Research the market with a critical eye and don’t rush into making a purchase you will regret later.
Buying a second property can be the best decision you’ve ever made. However, it requires all the same considerations as your first home, plus a few more. For access to expert advice and great rates, ensure to partner with a mortgage broker. If you’re looking in Red Deer and surrounding areas, contact our team and get started today!
Source was absolutely great to work with - went above and beyond to help us get everything done when buying our new home. Highly recommended!! Chad and Jenelle Richards Jan 09 2013
Chad and Jenelle Richards
Added January 23rd 2013
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