By: Lucy Donn, Guest Blogger
For most individuals, buying a second home brings many opportunities. Most importantly, the creation of a vacation “home-away-from-home” where new traditions can be born, and family memories can be made for a lifetime. Owning a second home can be the perfect platform to begin preparation for lifestyle changes or retirement plans. Living in a different location enables you to “test try” that area in advance and can potentially confirm or alter your decision to ultimately move there. And, believe it or not, a second home can become an investment today to support future plans for retirement later. You may ask yourself, “How is this possible in a fluctuating economy such as ours?” Because among the beaches and barrier islands surrounding Charleston, SC, where the weather is mild, and the tourism is booming, there is a 2nd home market right here waiting to grow your income!
Factors to Keep in when buying at the Beach:
Purchase Pricing: Location… location… location… I have heard it before, but how can I possibly afford it? Even within the Charleston beach communities of Folly Beach, Kiawah, Isle of Palms or Sullivan's there are notable differences in prices and affordability. And whether it is beachfront, ocean view, "one-block-back" or marshview, it is a fact that beach homes tend to cost more. Even a small condominium can be pricey based on its proximity to the beach. This is why it is so important to evaluate all the economic factors, including perhaps interest rates and loans that contribute to the overall cost of your investment. If you choose to purchase a new or renovated home, obviously you will spend more money up-front. If you choose to up-grade the interiors or renovate, you may want to consider who would be there to help you during the renovation period if you could not directly oversee it yourself.
Insurance: What? I have to buy MORE insurance? If your second home is by the beach this will lead to unique insurance needs. Obviously, a beach home is located near the coastline, which makes it very susceptible to flood and hurricane damage. As South Carolina is located on the East Coast, most beach home properties require the additional purchase of flood insurance to protect from the possibility of water damage from rain and coastal storm surge. It is also important to keep in mind that South Carolina does experience hurricanes, so hurricane shutters, a generator for loss of electricity, and thoughtful building materials might be recommended. Understanding the Flood Zone map, and the required building elevations based on that, is critical when evaluating where to purchase. One needs to carefully select a team that is seasoned and aware of the laws and best practices that are required for proper construction or potential renovations for bringing a home up to hurricane resistant standards … keeping in mind the eventual insurance savings to you.
Operating Costs: If I choose to make my second home a vacation rental, what is it going to cost me? These costs, known as “operating costs,” do not include paying the mortgage, taxes, or insurance on your home. They are costs that cover the more detailed expenses (utility expenses, maintenance costs, homeowner association or neighborhood fees, etc). If you plan to rent out your beach vacation rental home, it is considered an income property which, unless you are a devoted real estate investor who can spend time marketing, showing, collecting rents/paying the appropriate taxes, and providing the proper upkeep for your beach home (… whew!), then it is in your best interest to hire a reputable property management team to manage and oversee your property. An experienced team like Luxury Simplified Retreats might be the right fit for you.
You might be surprised to learn just how many people come to vacation on one of Charleston's popular beaches and decide to look at second home vacation properties for themselves while they are here. It may seem a bit impulsive ... but Charleston SC just seems to have that affect on people!
Note: If finding your perfect oasis on the beach in Charleston SC sounds like the second home you've always been waiting for, then start searching today ...
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