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Chris Kopf Coldwell Banker Mountain Properties

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Choosing the Right Vacation Home or Second Home

August 30, 2013 By Myreen Alcober

family-hot-tub-300x197Prices are down, way down.  In many areas, we are still looking at five-year lows on home prices.  In some popular vacation spots, such as Napa Valley in California, prices are down as much as 47% from the highs of 2006.  This trend won’t last forever.  If you’re serious about making the purchase of a second home, striking while prices are low just makes sense.  Other vacation hot spots are already starting to see price increases, particularly in popular beach communities like Myrtle Beach or Palm Beach.  So, don’t wait!

Currently, homes are also spending less time on the market with multiple offers coming in within just weeks of listing.  You probably don’t want to immediately jump on the very first property you look at, but when you see the one you like, the time to act is now.

Rentable is Preferable

It’s a second home, which by definition means you won’t be living there full time.  So, why not make the property work for you when you’re away?  Rental potential affects resale value and can supplement your own mortgage payments.  Before you finalize your purchase, it will be important to be sure you can rent out your beach bungalow or ski chalet on a short term basis.  Many home-owner associations or townships do not allow short term renting.

Some rental bonuses to keep in mind are:

  • Renters like lots of bathrooms.  One bathroom per bedroom is always a perk.
  • A great kitchen saves renters on having to eat out every meal.
  • A hot tub is always hot!  Vacationers want to relax and what’s more relaxing than a good soak?  A pool is a great perk, but hot tubs can be used year-round, not just in warm weather.
  • Look for other amenities that might appeal to renters.  Covered patios or porches, fireplaces, lush landscaping and good acreage, peaceful solitude plus easy access to shopping and dining are just a few pluses.

Rental Income is a Bonus Not a Sure-Fire Business

Be aware that if you’re not already an experienced vacation landlord, there are many expenses and responsibilities that go along with renting out your second home.  Consider the peak vacation times and that typical get-away properties are only rented about 17 weeks out of 52 in a year.  That’s not a full time income and you shouldn’t expect it to cover all your payments and expenses, although it can off-set them.

The income from renting can help you pay your mortgage, but keep in mind you’ll need to pay for cleaning, maintenance and insurance.  You may also need someone to manage the property.  Be prepared to pay at least 15% of the rental income to the property management.

A local management company should be able to give you information on the area’s history of rental dates plus rates for comparable homes.   To break even, you’ll want a monthly loan payment that is less than or equal to one peak week of rent.

Loan Rates Are Determined by Use

Be clear on how you plan to use the home.  Lenders are giving greater scrutiny to vacation homes.  If the property will indeed be used primarily as your own second home, you will likely pay close to the same mortgage rate as you pay on your full-time residence.

If rental income is necessary to qualify for the loan, the house will be treated as investment property.  In this case, expect to pay as much as 25% for the down payment and more interest.

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Chris Kopf, Coldwell Banker Mountain Properties
305 6th Street
Crested Butte, CO 81224
  • Chris.Kopf@CBMP.com
  • (970) 209-5405

Testimonials

Bobby Nichols

"The first moment we met Chris, my wife and I knew he was all about what is happening in real estate sales in Crested Butte. He knows his job, the marketplace and the innovative ways to market your home in today's electronic internet space. A real professional that understood us and our needs in handling a very successful sales transaction. "

 
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:45:19-07:00
"The first moment we met Chris, my wife and I knew he was all about what is happening in real estate sales in Crested Butte. He knows his job, the marketplace and the innovative ways to market your home in today's electronic internet space. A real professional that understood us and our needs in handling a very successful sales transaction. "  
https://chriskopf.com/testimonials/bobby-nichols/

Jeff Hollings

Chris is outstanding! We recently bought a second home in Crested Butte and Chris did a great job throughout the whole process. He has a thorough understanding of the market and the benefits and drawbacks of various locations. He was very patient with us as our preferences evolved throughout the search. He gave us valuable information on which to negotiate the purchase. He had great follow-up during the inspection/closing process (when we were not in town) and made sure all of the commitments made by the seller were properly completed.
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:46:48-07:00
Chris is outstanding! We recently bought a second home in Crested Butte and Chris did a great job throughout the whole process. He has a thorough understanding of the market and the benefits and drawbacks of various locations. He was very patient with us as our preferences evolved throughout the search. He gave us valuable information on which to negotiate the purchase. He had great follow-up during the inspection/closing process (when we were not in town) and made sure all of the commitments made by the seller were properly completed.
https://chriskopf.com/testimonials/jeff-hollings/

James Brennan

This was our first experience trying to purchase additional land with hopes of building a home. Chris was tremendously helpful throughout the entire process and his professionalism showed.
Crested Butte Real Estate by Chris Kopf
2014-10-14T17:59:24-06:00
This was our first experience trying to purchase additional land with hopes of building a home. Chris was tremendously helpful throughout the entire process and his professionalism showed.
https://chriskopf.com/testimonials/james-brennan/

Jane Saltzman

Chris was terrific to work with. The house sold faster then I ever expected! He was particularly helpful for this second home owner that couldn't always get there to take care of house issues. Thank you Chris!!!
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:49:37-07:00
Chris was terrific to work with. The house sold faster then I ever expected! He was particularly helpful for this second home owner that couldn't always get there to take care of house issues. Thank you Chris!!!
https://chriskopf.com/testimonials/jane-saltzman/

Georges Lussier

The thought of a short sale was intimidating, but Chris made the experience very easy with lots of guidance from start to finish. I would highly recommend Chris for any Real Estate need buying or selling.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:40-06:00
The thought of a short sale was intimidating, but Chris made the experience very easy with lots of guidance from start to finish. I would highly recommend Chris for any Real Estate need buying or selling.
https://chriskopf.com/testimonials/georges-lussier/

Frank Stringer

Chris Kopf is a wonderful person to work with on any real estate matter you may have in Crested Butte. He is extremely knowledgeable of all elements of the Crested Butte area. He helped us recently to buy a new second home in Skyland and the entire experience was first class under Chris's guidance. I would highly recommend him to anyone who has a real estate need in Crested Butte.
Crested Butte Real Estate by Chris Kopf
2015-02-11T13:51:04-07:00
Chris Kopf is a wonderful person to work with on any real estate matter you may have in Crested Butte. He is extremely knowledgeable of all elements of the Crested Butte area. He helped us recently to buy a new second home in Skyland and the entire experience was first class under Chris's guidance. I would highly recommend him to anyone who has a real estate need in Crested Butte.
https://chriskopf.com/testimonials/frank-stringer/

Paul & Julie Keesee

Chris was quite helpful in showing us homes in the area we were interested in and contacted us when new listings were available. We not only consider him our realtor but also a friend.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:59-06:00
Chris was quite helpful in showing us homes in the area we were interested in and contacted us when new listings were available. We not only consider him our realtor but also a friend.
https://chriskopf.com/testimonials/paul-julie-keesee/

Jim & Sandra Wickham

Chris' patience and persistence paid off for us in finding the right house for the right price. We would highly recommend Chris to any potential buyer.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:06:18-06:00
Chris' patience and persistence paid off for us in finding the right house for the right price. We would highly recommend Chris to any potential buyer.
https://chriskopf.com/testimonials/jim-sandra-wickham/

Tom & Mary Aton

It was a great experience working with Chris, after showing me what I thought I wanted, he advised me of the pros and cons on the different condos and found one that I am thrilled with.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:06:31-06:00
It was a great experience working with Chris, after showing me what I thought I wanted, he advised me of the pros and cons on the different condos and found one that I am thrilled with.
https://chriskopf.com/testimonials/tom-mary-aton/

Dan Aquaviva

This agent has a very strong knowledge of the local area. He was very helpful in screening properties for potential purchase.
Crested Butte Real Estate by Chris Kopf
2014-10-14T18:05:26-06:00
This agent has a very strong knowledge of the local area. He was very helpful in screening properties for potential purchase.
https://chriskopf.com/testimonials/dan-aquaviva/
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Crested Butte Real Estate by Chris Kopf

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