As a family raising kids in the city, there is something appealing about having a place to go to escape the pavement and enjoy nature, for a change of scenery and a breath of fresh air—not to mention a place to make memories. So when friends told us about a small “three season” bungalow for sale in Peekskill, New York, on their block we began for the first time to seriously think about the concept of owning a vacation home.
As one of 12 properties located in a pseudo Borscht Belt co-operative that shares 16 acres of land, a lovely stream, and a number of other amenities, the price was also right. And interest rates are still relatively low. So we went to check it out.
Are We There Yet?
They’d said the drive to their home was an hour from New York City. Admittedly, I wondered immediately if they were driving back and forth at 2am, but sure enough, it took us an hour (leaving at 9:30am on a Saturday, and returning at 1:30pm the same day) in both directions. This is a plus, of course, as a friend in real estate explained that any place more than a two-hour drive should raise a caution flag because owners typically tend to use it much less unless staying there for long stretches of time.
Get Familiar with the Home’s Neighborhood
I’d been concerned that by owning a vacation spot we’d feel obligated to go there all the time—after all, we’d want to make sure to get our money’s worth. As a result, would we no longer have the time or money to travel to other destinations? But, then again, with younger kids there is something to the concept of familiarity. Coming back to your home away from home, making friends with the neighbors and feeling comfortable with those in this new community were all pluses.
Really Look Around When Considering a Second Home
We quickly learned that seeing the home and the area in the off-season is key. As a matter of fact, if you have a chance to visit several times during different seasons, that would be ideal. We’d seen the area in the post-summer season, and it was very quiet. But how loud would it be during the peak of the summer? What did the surrounding towns have to offer throughout the year? Were there businesses that simply closed up come fall? What kind of activities would be available for kids and when?
The outdoor amenities offered as part of this co-op included a shared swimming pool (and children’s pool), a tennis court, and a “Casino Room” (with old pool and ping-pong tables), a wading stream and plenty of space for kids to explore. Already, the pool on the property was covered and closed. But we learned, as an alternative, there is a local track and a high school with an indoor swimming pool offering the ability to swim on weekends.
Consider the Amenities in a Vacation Home
In addition to what’s offered outside the home, it’s a must to learn about the amenities inside. In this case, the home was built in the 1950s, but had been renovated and kept in excellent condition, was converted from electric to gas, had beautiful, authentic flooring, an updated kitchen and a washer dryer. But, it was on the small side, and right away, my husband (who’s 6’3” on a good day) was talking about the need to expand.
Other neighbors had done just that—in the form of a large screened-in porch and outdoor deck. We also discovered that they’d had a to-do with the local zoning commission, although in the end, been allowed to move forward with the changes.
Although this home in the woods would allow us to be exposed to plenty of greenery, it was the other type of green needing serious consideration. Would we really be able to afford a second home? It seemed to be an investment for now, and potentially for later. But, a number of people who were already in the group told us of their difficulties getting a loan on a second home.
And after consulting a friend in the banking world, I was warned that with vacation homes, it’s very common to have to come up with even more than you’d needed on your own home—20 to 25 percent even as high as 50 percent for a down payment! We’d better be sure we loved the place and the area, as it only makes sense that we’d need to be coming back for many years to make our investment pay off.
Renting out a vacation home may allow some of the costs to be offset, but again, check the “fine print”—as in many co-ops and condos, there are rules that may limit or prohibit your ability to do that. If you do rent out for more than 14 days in a year, make sure you consult the tax man early—as you’ll need to understand how your rental income must be addressed come tax time.
Wells Fargo bank, for example, reminds potential buyers to think about “other expenses you may have in addition to monthly mortgage payments on the property—such as homeowners association dues, cleaning services, flood insurance, and utilities.”
But even with those additional payments, it could still be less expensive in the long-run. It’s worthwhile to review your travel expenses for the year to determine their value—you may be surprised as owning a vacation home may cost less than traveling and staying in hotels or rental properties.
No Packing Necessary when Traveling to Your Second Home
One of my favorite perks with the vacation home concept — being able to just get into a car, board a bus or train with nothing but your purse or briefcase. With the convenience of leaving seasonal clothes and other items (skis, bikes, snowshoes etc.) you should be able to make the trip with ease. My husband was practically drooling over the thought of reducing items from our basement storage and getting things out of kitchen drawers to put to good use in a vacation home.
As we spoke with our loving-their-vacation-home-owning friends two days later, we learned that a bid had been put down on the house the day after we’d seen it. We were fairly certain the house would sell quickly. We’d missed our shot this time. But next time, we’d be more prepared. And next time, perhaps we’ll find the perfect place to consider investing in a new family tradition for vacationing.