Some choose to purchase a second home to rent most of the year, usually in places, which have a regular influx of tourists, like Lake Gaston in North Carolina.
Others choose to buy a second home to have a dedicated location to vacation and rent it only occasionally. However, doing so closes off some nice tax benefits, because renting a home for less than 14 days a year means only being able to pocket the cash without paying income tax. That might sound great, but when compared to the alternative, isn’t nearly as a sound of an investment.
Choosing a Vacation Rental Home
As stated above, the best place to own such a residence is in an area that’s attractive to tourists. The size of the home really depends on your individual preference. In most instances, a two or three bedroom, two bath home will be the best option because it will be the most attractive to families. The good news, it doesn’t matter so much as to the property type, it’s purely about location in an investment situation.
Advantages of Owning Vacation Rental Property
There are several benefits to owning a rental vacation home, so let’s take a look at it from an investment standpoint:
● You own something with real value. Unlike other investments, real estate, legally known as “real property” is just that, and isn’t tied to wild fluctuations, as are things like commodities.
● The property will appreciate in value. When you purchase a property, it’s value will rise in the coming years, giving you large equity or a big return on investment if you decide to sell.
● There are tax deductions available. Depending on how often you rent it, you might be able to deduct the interest. If you can’t, don’t worry, you can deduct expenses.
● You’ll have extra financial leverage. Should you decide to purchase more real estate, it could be used as collateral in the future.
● There will be a steady source of passive income. Vacation rentals in popular tourist destinations practically guarantee a regular income stream.
● It’s a dedicated place to stay. When it’s not rented out, you have a dedicated location to enjoy, avoiding the hassles associated with overnight hotel stays.
Lake Gaston is a great Choice
This is a popular area because of the many outdoor recreational opportunities available. From boating, hiking, fishing, biking, to sightseeing and more. Basically the Lake Gaston area is an ideal place to own real estate