Wednesday, January 10, 2018 / by Leon Zhivelev
Thinking of Retiring and Moving to Florida? Here's your quick guide.
Written by Jim McKinley
Wanna Retire? Start with a Vacation
Wanna Retire? Start with a Vacation
For many, the thought of owning a second home is little more than a pipe dream and something
only the ultra-wealthy can achieve. But that’s not necessarily the case. Retirees and small-time
investors with a steady financial platform and realistic expectations will find purchasing a
vacation home in Florida an enjoyable – and profitable – venture.
The real question is why not Florida? Florida boasts more than 663 miles of beaches between
the Atlantic and Gulf of Mexico. Miami, Fort Lauderdale, and The Keys, along with the rest of
South Florida, enjoy beautiful weather year-round. Florida attracts thousands of retirees each
winter; the spring and summer make the Sunshine State a beacon for families. In addition to the
beach, Florida is home to some of the largest theme parks in America, including Disney and
Universal Studios. It’s truly a year-round destination, meaning your potential rental income is not
limited by season. If those are not reasons enough, consider that seven of the top 10 most
affordable beach towns are in Florida, according to Redfin Real Estate.
Choosing a vacation home
Your first priority is, of course, to determine how much home you can afford. When dealing with
vacation properties, there are many more costs to consider beyond the mortgage. Unless you
plan to do all the maintenance and legwork yourself, you’ll have to hire a property rental
company to handle these things for you. Insurance on a second home can be up to 20% more
expensive than a similarly-sized primary residence; you’ll need to budget for that as well. Once
you have an idea of what is financially feasible, you can then determine what type of home
works best for you.
US News & World Report notes that, in addition to calculating all potential costs, you’ll need to
know the rules of your second home’s condo association or HOA.
Choose a home in an area you enjoy visiting. This will ideally be a location you can return to
several times per year. Make sure the property meets your specific lifestyle needs. For instance,
if you value time on the beach, consider spending more to ensure you’re walking distance from
the sand. Your second home should have enough bedrooms and bathrooms to accommodate
yourself as well as any secondary guests, including adult children, grandchildren, and friends. In
order to capitalize on as much rental income as possible, HGTV recommends picking a popular
destination. In Florida, that means either near the water or within an easy drive to the
aforementioned theme parks.
Are you ready?
Purchasing a vacation property is a major decision not far off from buying your first home. And
as fun as it is to dream about lazy days on the beach, you must first determine if you’re truly
ready for the responsibility and expenses. According to Allstate, there are three questions you
should ask yourself before taking the leap into vacation property ownership. These are:
- Would the home get a lot of use?
- Is it affordable?
- Would I consider sharing the home?
You must also ask yourself if purchasing a vacation home is a sound investment when
compared with other options, such as an IRA or company-sponsored 401(k). It’s best to speak
with a financial advisor to assess your personal economy before writing a check for a down
payment on a home that you can’t afford or that won’t lend to your quality of life.
Once you have determined that buying a vacation home in Florida is right for you, partner with a
Realtor® who has experience helping out-of- state buyers procure rental properties. This
individual should have vast knowledge of your target city as well as the surrounding areas.
Florida is an excellent location to purchase a second home due to its favorable year-round
weather, rental viability, and overall affordability. With a little patience, the right investment may
pay for itself. After all, money that grows on its own is the very best kind of currency.