What To Consider Before Buying A Holiday Home

For many Australians, the option of purchasing a holiday house for dual use an investment property is an attractive one, as it provides investors with a viable prospect for on-going rental returns and unique lifestyle benefits. Despite such, it is imperative that all investors – no matter how experienced – properly weigh up the pros and cons relating to this type of investment; not only can holiday houses have some great advantages, but they can also have inherent risks and drawbacks.

With this being the case, I have decided to outline five important factors that should always be considered before purchasing a holiday house for investment property purposes:

1. Ensure that you account for different expenses that come with owning a holiday house. The holiday accommodation industry is competitive and, as such, you will need to factor in costs associated with advertising and marketing the property.  In addition, you will need to consider hidden costs including, but not limited to, agents fees, land and council rates, and general maintenance expenses.
2. As an investment, holiday houses are particularly susceptible to annual fluctuations; peak holiday seasons last for relatively short time-periods, which can potentially make finding regular tenants difficult. Although weekly rates for holiday rentals are generally quite high, these types of properties can sometimes lay unoccupied for weeks at a time, leaving owners to cover mortgage payments without any income support from the investment properties themselves.
3. There are a number of significant tax benefits that can potentially be leveraged via ownership of a holiday house. Ensure that you speak with a qualified accountant or tax adviser to understand the types of deductions that may apply.

 

4. If you do decide to purchase a holiday house, try to cater to a wide variety of potential tenants. For example, you might want to consider purchasing a one-bedroom or two-bedroom unit as these property types may be appealing to both families and couples.

In addition, you should look to identify a location that is not only idyllic in setting but also close to amenities such as shopping centres, public transport and entertainment venues.

 
5. Research and work with a real estate agent to list the risks involved before proceeding. While holiday houses can potentially deliver significant rewards, they can also carry large financial risks. As such, it can often pay to make a properly informed decision.


Source: Paul Mylott Blogs, www.century21.com.au/blogs/

 

About Port Douglas

Port Douglas real estate - Real estate in Port Douglas is now sought after the world over. Our passion for where we live stems from Port Douglas being the only place in the world where two natural, world heritage listed sites (the Great Barrier Reef & Daintree Rainforest) exist side by side. If you would like buy or live in your own piece of paradise, please browse our real estate listings http://www.realestateportdouglas.com.au The views expressed in the Port Douglas blogs are not those of Century 21 Port Douglas Real Estate nor the Century 21 franchise.
This entry was posted in Australia, Australian Home Buyers, Australian Homes, Buy Property With Your Superannuation, Buyer's need to pay attention To Details, Century 21, Century 21 Port Douglas, Far North Queensland, Great Barrier Reef, Port Douglas, Property Port Douglas, Property Tips, Property Values, Propety Prices, Queensland, Tourism. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

web design by precedence