Is a holiday home a worthwhile investment?
Those of you who are thinking about investing some of your hard earned money into a home away from home this year might need a little more convincing as to why it’s a great idea. Every year, more and more people are choosing to buy properties abroad and here are just some of the reasons why.
Enjoy great weather
If you’re currently residing in the UK, you’ve probably spent long hours daydreaming about being somewhere with warm, sunny weather. A lot of people opt for a home abroad simply because they want to have somewhere that they can go to enjoy lazy days on the beach soaking up the sun. Relocating to Monaco, for example, will give you the opportunity to benefit from sandy beaches as well as a variety of historical attractions with good weather almost all year round.
Have a steady income
Perhaps the reason for buying a holiday home is because you want to jump on the buy-to-let bandwagon of people who regularly rent their second property out to achieve a steady income. In the best case scenario, your holiday home can turn into your biggest asset, and you’ll diversify your money by basing your wealth across two countries. Plus, you might even benefit from a lower cost of living when you’re spending your time at your holiday retreat.
Protect your hard assets
A hard asset such as a second property is a sensible investment option in the current scenario because it means you can secure your wealth by investing in a long-term asset. No matter the economic climate, your property will never be valued at zero, whereas stocks and shares certainly can. However, you might have to ensure that the property value doesn’t fall too much to cause you financial damage. That can happen if you won’t do regular upkeep and maintenance of the house, which can lead to problems such as structural damage, wall dampness and mold, pest infestation, and more. These issues can negatively affect your property value. In case you encounter pest and mold issues on the property, you can consider hiring a company such as Pest Control Experts for property inspection and pest removal services. When investing in hard assets, ensure that you take all necessary measures to protect its value.
Expand your cultural horizons
The experience that you have while on holiday is completely different to what you’ll experience if you become a local. Yes, you may still spend a considerable amount of time at your first home, but owning property in a different country will give you the chance to learn the ins and outs of another culture and maybe even pick up a new language on the way.
Of course, as with every big decision, you’re advised to weigh up the pros and cons before you commit to investing in a holiday home. In that case, here are some things you might want to think about.
Falling property prices
Before you set your heart on a particular place, make sure you research the property market in that area. You don’t want to invest in a house or an apartment that is only going to go down in price the minute that you’ve bought it.
Even when you take away the potential financial strain, it isn’t easy to maintain a holiday home. When you’re not there, you may want to employ someone to clean the property for you or to keep your garden well looked after, but this will take the time to find someone you can rely on and then you’ll have to think about how you’re going to pay them from abroad.
The biggest nightmare to any buy-to-let landlord is untrustworthy tenants. Although letting your property out will give you a bit of extra cash in your pocket, you’ll be placing your trust in the hands of those who are staying there to keep everything in one piece.