Lake Nacimiento’s vibrant community is one of the many things that draw buyers to purchase a home in the Oak Shores or Heritage Ranch communities. However, a number of people who buy a Lake Nacimiento home are not permanent residents and enjoy vacationing on our beautiful lake whenever they get a chance! They look forward to getting away for a weekend or even weeks at a time during the summer. Vacationers know that when they come away to Lake Nacimiento, a fun and relaxing time awaits and the built in community offers many things to do year round!
If you’ve been thinking about buying a vacation home on Lake Nacimiento; now is a great time to do so! Current pricing is reminiscent of market prices from 10-15 years ago. This reduction in vacation home prices has opened the opportunity for more people to enter the market of owning a second home.
However, it’s important to note that because of this year’s tightening of the reigns of qualifying for a mortgage loan, you will probably need to put down more money up front. The average down payment for vacation homes is 30%, and nearly 40% of vacation home sales were done in cash to get around the strict loan guidelines. The great news is that because of the lower market prices for vacation homes, it’s easier to have a larger downpayment.
There are five additional things that Money.CNN.com recently noted are key to know before buying a vacation home and why now is an ideal time to buy a vacation home on Lake Nacimiento.
1. Now is a good time to pounce– In many second-home hot spots, prices are still close to their ten-year lows. Most economists believe the biggest declines are behind us, so buying now before prices begin to rise will prove to be a smart decision.
2. A home is a better deal if it’s rentable– You may think you’ll keep the retreat all to yourself, but it’s still smart to shop as if you’re going to rent the place out. That’s because a home’s rental potential can affect its resale value. Before you bid on a house, make sure the homeowners association or township allows short-term rentals (many do not). Your Lake Nacimiento Real Estate agent can give you the details of the Oak Shores Community Association and Heritage Ranch Homeowners Association!
3. Don’t count on rental income to pay your bills– The typical property rents out just 17 weeks a year, says Christine Karpinski of vacation-rental site HomeAway.com. However, for Lake Nacimiento rentals there are many factors determining how many weeks’ homes are rented. The average time is 6-8 weeks a year. Plus, you’ll need to pay for cleaning, maintenance, insurance, and maybe management fees (at least 15% of income). If you decide to rent your home out you will need to consider any income a bonus and not count on it to pay the bills.
4. Your loan rate depends on how you use the house– Lenders have raised standards across the board, but they’re giving extra scrutiny to vacation homes. Use the property primarily as a second home and you’ll pay about the same mortgage rate as you would on a primary residence, says HSH Associates vice president Keith Gumbinger. If you need rental income to qualify for the loan, however, the house is treated as investment property — so you’ll have to fork over as much as 25% for the down payment and pay up to one percentage point more in interest.
5. Tax benefits can be sweet– Rent the house out for two weeks or less and you won’t have to report a cent of income to the IRS — and you can still deduct property taxes and mortgage interest. Stay there for less than two weeks or 10% of rental days, whichever is greater, and you can deduct operating costs — everything from cleaning fees and maintenance to linens and repairs — in addition to interest and property tax. Use and rent a lot? You’ll have to allocate the write-offs between personal and rental use, which gets tricky, says Rick Shapiro, a CPA in West Hartford, Conn. So talk to your tax guy before you buy.
I hope this answers some of your questions about buying a vacation home in Lake Nacimiento! If you still have questions about what’s involved in buying a Lake Nacimiento vacation home, or about the Lake Nacimiento Real Estate market, please let me know! I would enjoy the opportunity to talk with you about what you’re looking for in a vacation home and show you some of the homes currently available on Lake Nacimento. Feel free to contact me today to get started. Your vacation is waiting!
Grace Borzini
Your Local Lake Nacimiento Real Estate Expert
Oak Shores Realty
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Oak Shores Realty specializes in Oak Shores at Lake Nacimiento properties. Please contact us today to get more information on Lake Nacimiento lake homes. Oak Shores Realty can also provide you an insiders “Lake Nacimiento Buying Guide” with great information including maps and market information.
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