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There’s nothing like a short trip to the hills or the beach to relax you. More often than not, these trips get you contemplating about purchasing a vacation home by the foot of the lofty mountains, or on the sandy shores of a tranquil beach. How difficult can owning a second house be?
Quite difficult, it turns out. You need to keep in mind that there are more expenses involved in purchasing a second home than just the cost of the property. Be wary of, and be prepared for unique costs that will suddenly creep up on you. Let’s take a look at some of the hidden costs that you might incur as a second homeowner.
Though you might not be occupying your second home throughout the year, you’ll be subletting it to tenants. As second homes are typically vacation getaways, you’ll have to pay careful attention to the furniture. Avoid going to high-end furniture shops. You can save on money by looking at secondhand furniture in thrift stores or online.
Most people who rent out your second home will be travelers looking for some peace and quite. They would not want to be bothered by trivialities such as frayed sofas and dusty rugs. Make sure the furniture you keep in your second house is in good condition.
Cleaning the Place
You’re going to have to clean the place thoroughly in between each rental. Travelers come and go, leaving behind a whirlwind of a mess. Cleaning the bathroom will require detergent and soaps, and you’ll need to vacuum the carets and drapes. Making the house look spotless and brand new every other week or so is going to cost you a fair amount of money.
Once you lease out your second home to travelers, your property becomes a commodity. You will have to make sure it looks brand-new every time a new group checks in. This means you have to be on top of repairs, making sure everything is fixed and in working condition. If your carpets are fraying, replace it. If the paint is peeling, repair it. These may be slightly expensive, be warned.
You will be faced with monthly electricity, gas and water bills. These bills will be borne by you completely, so make sure you charge your tenants adequately. You’ll need to maintain the exteriors as well, so account for painting charges and landscaping in your rental quote.
Forfeiting Rent During Season Time
The main point of you purchasing a second home is to enjoy it during the right season. This means that you’ll have to give up a couple of weeks of rent. This might set you back financially, so make sure the price you quote for tenants more than makes up for it.
Remember that with a regular cash flow in the form of rent, comes costs incurred for upkeep and maintenance. Proper planning will keep you from facing financial problems.
What to Know as a Homeowners
Modern building projects are complex and require precise organization. Builders manage a number of subcontractors, purchase surface protection and materials from many suppliers, adhere to numerous buildings codes and regulations, and ultimately answer to the homeowner overseeing the project. Due to this complexity it may feel as if a homeowner is far removed from their own project. However a homeowner’s role is as valuable as ever; the homeowner has the final say on project decision.
A homeowner’s role as project leader is of paramount importance towards finishing a job, as their decisions carry lasting impacts on the management of a project. Just as easily as good communication can expedite a remodel, detrimental decision can delay a project by weeks. Homeowners can take basic steps to best prepare them to effectively manage a project.
Foremost, learning about the construction process is the best preparation a homeowner can take to facilitate timely completely of a project. Understanding the progression of a project through its various planned phases will help to ensure timely completely of work. Knowledge helps the homeowner effectively communicate with the builder as a project progresses through planned phases. Understanding the pace, surface protection, and the material needs of a project allow a homeowner to constructively communicate with their builder.
Further, requesting a change order can significantly alter the planned timeframe of a project. A change order is a decision made after a previously agreed upon deadline has passed. For example, a homeowner may decide to change the type of floor being installed in their home. A new decision may delay a project as now new floor needs to be purchased, and surfaced protection methods may need to be revised. This change can have continual effects, as a setback in one aspect of a project can lead to further delays to subsequent phases of a project. It is the builder’s job to best accommodate change orders. But as the leaders of their own projects, it is the homeowner’s obligation to communicate with the builder to best implement change to a project. It is a homeowner’s responsibility to understand the potentially significant impact of change orders.
By learning about the building process of a project and communicating with your builder, many costly problems can avoided. Homeowners should be able to agree with their builder on reasonable deadlines, and follow through to adhering to those deadlines. A well prepared, educated, and savvy homeowner will be able to meet their builder halfway to best streamline the building process.
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