"What is more agreeable than one's home?" - Marcus Tillius Cicero
Having a home is the ultimate goal of working for some people. There are people who want to invest for the sake of buying a home once they start earning money. Home is the first priority that everyone has on his or her list and this is quite wise and obvious because that is the place where you can go and seek refuge when you need rest. Having your own house is nothing less than bliss in today's world when the price of real estate is booming. Everyday the prices are escalating, therefore buying real estate is becoming more and more difficult and selling it is becoming easier. Investing in real estate is the best method of investment. Now you might be wondering exactly what I am trying to drive home? Let me put in a straight and simple way! Owning a house is essential for any individual or family, but investing in another house apart from your primary residence is the best way to invest money if you have that kind of money. Now the question arises that if a second home is bought, then how is it going to be profitable apart from its resale value.
Why should I Invest in a Second Home which would add to my Annual Expenses?
It is true that a second home might add to your annual expenses but then there are many more advantages to it than disadvantages. If you have money you would definitely like to invest it somewhere where it would multiply but given the kind of fluctuation the market goes through everyday, you might just end up investing it in a wrong place, if you are not a pro in the field of investment. The next thing that all of do is save the money in the bank but let me remind you that though you get a minimal interest rate, you certainly pay taxes for the same. So you have to face either risk or taxes, is there a way out? Yes investing it in a home is much more beneficial, you might pay the personal property tax but at the end of the day the property might just yield you the lost money. It serves as a backup for your hard times. You can also put it out on rent or keep it as vacation home for some solitude when you want to get away from the din of the known surroundings.
Will I get a Home Loan for my Second Home?
Yes certainly, if you do not have enough money to put in for the loan you can go for a mortgage, which is almost the same for primary and second homes. Even if you declare your second home as an investment property you would end up paying an extra interest of about 1-2 % though this is also determined to a large extent by the lender or broker who is handling your deal. As far as the down payment of the second home is concerned one way of paying it would be to borrow from the equity of your first home. This is also going to save up on your taxes.
Things to Remember Before Purchasing the Second Home
There are a few things that you might like to check before buying a second home and the following is a list of the same:
- Transport
- Possibility of renting the house
- Condition of the house that you are buying
- Area
