We all crave that house by the lake to spend the summer with our loved ones. Buying a lake house is slightly different compared to a traditional purchase. It is important to understand these differences before making a decision.
First of all, you need to know your intended use.
Is this going to be your permanent residence, a vacation home, or an investment property? For a primary residence, you have the advantage of having the lowest mortgage rates possible. Also, you can obtain the property with as low as 3 percent interest rates. If you purchase it as a secondary residence, some mortgages do not permit owners to rent it out, so you may need to purchase it as a cash sale or with other means if you plan on financing. How you intend to use the home will also change what you’re looking for in the home!
Once you know what you’re expecting to get out of your lake home, you’ll be ready to plan out your budget for purchasing a lake house.
You should put into consideration not just the purchase price, but the closing costs, insurance costs (including flood insurance), taxes and special assessments on the property, management costs, total costs for utilities. the costs of traveling to the house and back to your primary home, the costs of any outdoor facilities and gear such as jet skis, kayaks, boats, and others, and the cost of property upkeep.
Third, review the monthly and yearly costs of managing and accessing the property.
In this case, you need to consider several items to know the total costs of maintaining the lake house. Are there yearly association fees on the lake? How much will it cost you to travel to your lake home every time you’d like to visit? What would it cost you to store a boat somewhere if you can’t store it on your own? Are there licenses you need to purchase to have a boat on the lake? How difficult is it to maintain the yard and home, and are you planning on being at the home frequently enough to take care of it on your own, or will you be hiring services?
Lastly, you need to research local Realtors and lenders before making an offer.
Local agents are equipped with the knowledge and experience to help you find the property best suited to your needs for the best price.
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