2. Additional costs can add up and eat into the benefits of buying a second home.
Craig Venezia, author of "Buying a Second Home: Income, Getaway or Retirement," estimates that insuring a vacation home that gets rented either in part or in full costs about 20 percent more than a primary residence.
Where rental properties are concerned, tax rules differ, marketing costs exists, and added medical and liability insurance coverage may be required. (If you rent your home for more than 14 days a year, you will need to report rental income and your state may require that you pay sales tax on that income. But you will be able to deduct rental expenses, including repairs.)
Those who plan to rent their property for added income should investigate potential return more aggressively. Is the opportunity to rent seasonal or year-round? Is the property close to local attractions, such as a beach or a lake, which makes your home more marketable? Do you need to hire a property manager? And how much can you reasonably expect to make in rental income, relative to similar properties?
Where vacation and rental homes are concerned, due diligence on owner communities is critical. Vacation homes are often built in communities with a homeowner's association, which divvies up annual maintenance fees among its residents.
"If any of the homes in that community get foreclosed upon, that puts tremendous pressure on the other homeowners to pay those fees," Woodward said. "Make sure that the community you're buying into is in good financial shape."
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Lastly, be aware of the added costs associated with owning a second home. You may need to pay a handyman, for example, if you don't live close enough to fix leaky pipes or leaf blow yourself, and flood insurance is often required for properties near the water.
"I am not a huge fan of buying second homes, but I am a big advocate of investment properties," Bera said. "Usually people don't use their second homes enough to justify the costs. It would be cheaper for them to rent a furnished apartment for a few months a year and then change locations if they decide to try a different country, city or apartment for a while."