Vacation homes for the FIRE'd

[fisherman]

We bought a lake home five years ago as a vacation home and possible future retirement home once th kids are gone. We paid cash for it so we do own it free and clear as well. It is about 60 miles form our main home.

The lake house is in a small subdivision with good neighbors. About a third of the neighbors are full time and the rest part time. our neighbors on both sides are full time so they watch the place for us which is nice but we really do not worry about it. If something happens that is what the Ins is for.

We have averaged 80 to 120 days a year there. We go 2 to 3 weekends most of the year and then usually spend spring break there as well as part of the summer and Christmas break. DW and I also use it separately for her to have a girls weekend or me to have a guys fishing weekend a couple of times per year.

We do travel to other places also each year either camping in the TT or staying in FL for a couple of weeks at least in the fall.

ESR has really help the travel time and lake house time although we found ways to use it a lot before ESR also.

I do all the maintenance myself which for now I enjoy and that keeps the cost down. Taxes and Ins are much less than our primary residence and utilities certainly are. It however is not considered an investment. We do imagine that we will be able to sell it for more than we paid but the rate of return after expenses and deductions would not even match a tax deferred bond so it is a toy. The current tax appraisal is 50% higher than we purchased at and still lower than homes in the neighborhood have sold for this year so if we sold this year it might work out to be a half decent investment but that is not going to happen. Long term that % is very likely to drop.

We keep our boats there at the dock ready to go year around and that is worth a lot to us. It has also been a great place to spend family time and entertain upon occasion.

We keep it fully stocked with cloths and toys as well as some food in the freezer. This means all we have to take is perishable food and Walmart is only 4 miles away if we need anything else. We use a programmable thermostat and just turn the water off when we leave so its not to much work to open or close the place.

We did try renting it as a vacation rental one year before ESR as a fall back plan test and $ wise it was good in that it cleared $1000 a month for the year. We were still able to use it some as well since it was being rented as a vacation rental. The bad part is it limited our time there and was a real pain to put up and lockup everything we did not want renters to use. Also we are clean freaks so even though the company that managed it for us had it cleaned we would clean again before staying. We do not plan to rent it again unless finances require it which thankfully does not appear to be a likely case. Vacation rentals are a good option for the right property if it works into your schedules and plans well but I would not buy and plan to rent in order to afford the home. It would be much better to just rent someone else's when you want to go.

If you want to have a special place to get away from and know you can spend a good bit of time there and do not mind house work then a vacation home is probably for you as it was for us but it is definitely not for everybody. We have several friends that have second homes and after a couple of years got disappointed with them since they could not spend enough time to justify having them. We are able to spend the time there and still travel other places. If you cannot do that then most likely you will not like a second home. YMMV

[Sea Kayaker]

I own about 5 acres on a small island in British Columbia. Beautiful place on which I will retire... I have no doubt about this. Problem is, the cost of getting services (power, water, septic field etc.) into the building site is daunting - and then you still have to build a cottage. My wife and I are die-hard LBYM'ers and are socking away $ furiously for our early (hopefully) retirement, so the thought of the costs of developing this land is tough for us to swallow. We are in our mid-30's so time is on our side I guess...

[NW-Bound]

It turns out many of us on this forum have 2 homes. When one is still working and lives mostly in a main residence, the other one is the "vacation" home. When one retires and alternates between them, then they are just "homes". Retiring takes the "vacation" out of it! Got to have an RV!

About owning a small piece of an island, last year while surfing the Web for real estate in the Puget Sound, I ran across a couple of listings of lots of a few acres on tiny islands. These are islands in the very true sense that they are surrounded by water and you need a boat to get there if you can't swim 1/4 to 1/2 miles (in cold water of course). It was intriguing to think one can play Robinson Crusoe in the 21st Century. However, these lots weren't cheap, and I quickly suppressed my fantasy.

[Sea Kayaker]

Thankfully, my island is blessed with ferry service... swimming in these frigid northwest waters is hazardous to ones health.

[Kroeran]

bought a Florida gated condo last year as second home

Pros
- once in a lifetime prices
- relatively safe place to hide investment money away from tax man, mutual fund salesmen and the Bernie Madoffs
- tool for family social cohesion...place to invite visitors and loan out to relatives, rent to friends
- second homes are approved under the "Die Broke" philosophy
- most neighbours in vacation condo situations are looking to be friendly and make quick friends
- avoiding spending after tax earnings on hotels and hotel taxes, air travel expenses (its a three day drive for us, not unpleasant)
- I LIKE having repairs and installs to do and excuses to pop over to home depot
- I LOVE having shared pool...no maintenance tasks and very social (still peeling from the burn I got bobbing and drinking in the pool last month!)
- Insurance requirements for gated condos are less stringent regarding houseminding
- Ownership is something you enjoy even when you are not there!
- possibility of capital gain
- buying, furnishing and figuring out all the issues is VERY entertaining for DW
- if you don't spend it, you know who will

Cons
- once in a lifetime risks to builders not finishing and associations going bankrupt, chinese drywall, city and state mismanagement, builder closing tricks
- taxes (research lower cost states), HOA, CDD, high risk insurance, flood insurance, cable, electric, phone, minder, AC maintenance, furniture, and so on
- hassle of paperwork associated with renting out
- rental neighbours with scary tatoos who leave cigarette butts on the pool deck (at least it is good to know there is someone handy to hire in case I need to whack a neighbour ; - ) [this is the sort of joke Canadians can make, and not be misunderstood!] ....that stuff doesnt bother me, but does peeve sensative types
- fear of natural disaster, such as hurricane, when there, when not there
- very disciplined types rent...I guess the question is if you are happy being disciplined ALL your life

the tradeoff with having a stand alone house is less expenses but the maybe neighbours who don't maintain their properties, breakins when you are away, and you may have to work harder at making friends in the new area, which may not be a consideration

main thing, RENT IN AN AREA BEFORE YOU BUY!!!!

[tryan]

Quote:

(its a three day drive for us,

Your pain threshold exceeds mine! When we looked, I drew a 120 mile circle around the house. Told DW "anywhere in this circle". Thought was: 2 hour drive ... ended up with 2.5 hours due to the back roads.

Obviuosly you bought at the right time! Good luck!

Here's a question for all second home owners: How many weeks a year are you in the second home?

We average about 6 weeks. Need to add a bunch of weekends together to get there. Typically 2 weeks in the winter to ski, 2 weeks in the summer for the lake. Then weekends: some holiday, a golf outing or two and a couple "girls" weekends.

[M Paquette]

The island getaway sounds neat... for about 30 seconds. I'd need a boat, and I recall the definition my boat-owning friends use: "A boat is a hole in the water that you fill in with money." Not for me, thanks.

I'm considering renting condos in areas of interest for short periods, a week or so. There are a number of these in my target area. Once I find something I like, I'll try a lease for a year unless something is screaming "Buy!", as a year's lease looks to be 2-3x the property taxes, or roughly half a realtor's commission (starving 6%ers out there...), to make sure I like the place, and get reasonable use out of it.

The target area is perhaps 3 hours at most away by car. The particular places I have an eye on have a very high walk score, and the region has plenty of nice activities. (It's actually better than the megasuburban wasteland I currently live in, with nothing in walking distance but other homes.)

[haha]

Quote:

Originally Posted by M Paquette The target area is perhaps 3 hours at most away by car. The particular places I have an eye on have a very high walk score, and the region has plenty of nice activities. (It's actually better than the megasuburban wasteland I currently live in, with nothing in walking distance but other homes.)

Why not just move there. I am kind of surprised by all the interest in 2nd homes, given that we have so many threads about LBYM and living simply.

There are things less simple and LBYM (unless one's means are huge) than a 2nd home, but not too many.

My neighborhood has a 98 walkscore. I really don't want to go very far away. I still own a country home in nice area, but I pay to keep it up and never look forward to going there.

I tend to think of all the crap that I should do while I am there, so I just put it out of mind and don't go.

If you live in the right place for you, you won't need so much distraction. Sometimes people say to me, "are you going anywhere this summer?" My answer is invariably "no, where would I prefer to be?"

If I could find a cheap way to spend a month each year in NYC, and a couple months at the beach in LA/Orange County in September and October, I would bite. But I suppose that is a tall order.

Ha

[freebird5825]

I am reading this thread with great interest. TY to all for your candid comments.
We are loosely formulating the 9.5 year plan to escape East Nowhere, and have the notion that we will rent. What we will not do is try to have someone maintain this house in the winter while we snowbird to a vacation or half year 2nd home. Too many true stories of burst pipes when the realtor was supposed to be checking the house regularly.
Plan A: We have already decided to relocate completely out of the state. It's just a question of what we can afford and where.
Plan B: If we can't afford a full move, we will sell this house to head southwest for the Finger Lakes of NY, which has a milder climate, longer summer and is truly beautiful.
Country living has become a cherished lifestyle for both of us. It's just way too remote and snowbound here.

[NW-Bound]

Quote:

Originally Posted by Sea Kayaker Thankfully, my island is blessed with ferry service... swimming in these frigid northwest waters is hazardous to ones health.

On the ferry from Nanaimo to Vancouver, we saw some of those islands. Later, found out that some offered B&B lodging and even luxurious hotels for visitors. I mentally made a note to add them to places to visit, along with other San Juan islands. Yeah, right. It only takes time, and of course money. I have yet to make an effort to stop by Lummi Island, the lowest hanging fruit, in a day trip when traveling between Seattle and Vancouver.

One more reason for me to get an RV...

Quote:

Originally Posted by Kroeran bought a Florida gated condo last year as second home.

The distance for you to travel may be about the same we would have to travel if we bought a place in the Saanich Penninsula. My problem is that whenever I go, I always tell myself that it would be a neat place for a 2nd home. The difference between me and those billionaires who have 2 dozen houses throughout the world is that I do not have their billions. It's illogical, but a common weakness, I'd say.

Quote:

Originally Posted by haha I still own a country home in nice area, but I pay to keep it up and never look forward to going there. I tend to think of all the crap that I should do while I am there, so I just put it out of mind and don't go. If you live in the right place for you, you won't need so much distraction. Sometimes people say to me, "are you going anywhere this summer?" My answer is invariably "no, where would I prefer to be?" Ha

If you neglect your 2nd place, how long will it remain standing? Yes, maintaining a 2nd home may become a chore.

Regarding how much use a second home sees on the average, I will have to say that it is not high. We use ours a lot more than other part-timers in our area. Owning our place for 4 years now, and going for a hike through the subdivision nearly every morning when we were up there, we saw some houses that were always vacant. Always. What was the point of the owners to keep the house?

If it weren't for my part-time work (which often requires face time), and my wife's need to watch her aging father, we would have split our time 50/50 between our 2 houses, which are 3 hrs apart but differ in elevation by several thousand feet. In other words, we can be snowbirds within our own state.

About "walkability", I suspect most of AZ would score very low. At my place in the metropolitan Phoenix, I am happy to have several grocery stores, Lowe's, Home Depot, and a library branch within a 3-4 mi radius. Walkability is a foreign concept to Southwestern state residents, I am afraid.

Quote:

Originally Posted by freebird5825 We are loosely formulating the 9.5 year plan to escape East Nowhere...

I admire people who can make such long-term plans. Most of the events in my life, be it career move or business decision, have gone wayward compared to my original plans. Yet, I tried to remain flexible and I survive so far. I now only make short-term plans and am open to more spontaneous happenings. I think it's more fun.

[W2R]

Quote:

Originally Posted by haha Why not just move there. I am kind of surprised by all the interest in 2nd homes, given that we have so many threads about LBYM and living simply. There are things less simple and LBYM (unless one's means are huge) than a 2nd home, but not too many.

I couldn't agree more. For a while, I wondered if the interest in 2nd homes was due to insurmountable indecision. Somehow, I think not. I suppose there is an appeal that I just do not quite understand.

Quote:

Originally Posted by haha My neighborhood has a 98 walkscore. I really don't want to go very far away. I still own a country home in nice area, but I pay to keep it up and never look forward to going there. I tend to think of all the crap that I should do while I am there, so I just put it out of mind and don't go.

Have you thought of selling it, some day? It doesn't sound like it is adding value to your life.

Quote:

Originally Posted by haha If you live in the right place for you, you won't need so much distraction. Sometimes people say to me, "are you going anywhere this summer?" My answer is invariably "no, where would I prefer to be?"

You sound so happy with your present location. There's a lot to be said for that. The cost of living there is high, but at least you are getting value for your money there. The walkability of the area sounds wonderful.

Quote:

Originally Posted by haha If I could find a cheap way to spend a month each year in NYC, and a couple months at the beach in LA/Orange County in September and October, I would bite. But I suppose that is a tall order.

I suppose it is.

[NW-Bound]

Quote:

Originally Posted by Want2retire ...For a while, I wondered if the interest in 2nd homes was due to insurmountable indecision. Somehow, I think not. I suppose there is an appeal that I just do not quite understand.

In talking to the part-timers in the area of my 2nd home, I find that there are a couple of neighbors who enjoy their place as much as we do ours. The others look at their place as an investment. A believer in stocks and not real estate, I have told DW and myself that we should not expect to make big bucks out of it, if and whenever we sell. Considering taxes, insurance, maintenance costs, and other selling costs, if we break even, we should be happy that we get some free use out of it.

For now though, we love it. Lots of "walkability", actually more like hiking. I of course prefer to be on my motorcycle, cruising through forest service trails, the wind in my face and rustling over the pine tops

[M Paquette]

Quote:

Originally Posted by haha Why not just move there. I am kind of surprised by all the interest in 2nd homes, given that we have so many threads about LBYM and living simply. There are things less simple and LBYM (unless one's means are huge) than a 2nd home, but not too many. My neighborhood has a 98 walkscore. I really don't want to go very far away. I still own a country home in nice area, but I pay to keep it up and never look forward to going there.

Heh, heh. DW has an emotional attachment to this huge tract home we are currently in, in spite of two of three kids being launched, to opposite corners of the country. (One 600 miles away, another on the opposite coast.) The third one is in college now.

My Sekrit Planz (shhhh!) are to get a second home in a very walkable neighborhood, with an environment we both like, and gradually turn it into a primary home. The places I'm looking at have very high walk scores, are close to medical facilities, recreation, and entertainment.

[haha]

Quote:

Originally Posted by M Paquette Heh, heh. DW has an emotional attachment to this huge tract home we are currently in, in spite of two of three kids being launched, to opposite corners of the country. (One 600 miles away, another on the opposite coast.) The third one is in college now. My Sekrit Planz (shhhh!) are to get a second home in a very walkable neighborhood, with an environment we both like, and gradually turn it into a primary home. The places I'm looking at have very high walk scores, are close to medical facilities, recreation, and entertainment.

Those are my criteria too. If I were not committed to Seattle where my family is, I might consider NYC or LA beach communities. A really large city right on swimmable beaches is very hard to beat. And depending on where you live, LA is mostly walkable, though you may want to get in your car to grab entertainment 15 or 20 miles away. When I lived in Venice Beach other than driving to work I mostly walked.

I think your plan should work as your wife will likely be seduced by the much greater opportunities for pleasure in the type of neighborhood that you are heading toward.

IMO medical is important too. There is a big difference between any bunch of doctors, and a really great medical center. Also a big difference in having your doctors and hospitals 10 or 15 minutes away vs a long car trip and maybe overnight stays or exhausting trips home late at night.

I formerly lived where many of the permanent residents were retired, and when they got old or unlucky their lives tended to turn into long emotionally or physically painful trips to the city.

Ha

[bizlady]

Quote:

Originally Posted by tryan Here's a question for all second home owners: How many weeks a year are you in the second home?

Every weekend for us year around, except major holidays. 2-3 weeks for vacation. We are not retired yet, but empty nested, and expect to spend about half the time here once retired. 2nd home is 2.5 hours north from our base.

When home and retired, will help aging parents and visit our daughter and family. Oh I suppose the mundane maintenance on the base home and stuff like that too!

[Ronstar]

Quote:

Originally Posted by tryan Here's a question for all second home owners: How many weeks a year are you in the second home?

We do about 9 trips at 4-7 days each to our Az condo. A trip every month, except May/June and August. I pop in in July just to experience a little heat. I spend more time there for baseball spring training in Feb/march. After we fully retire, we'll lessen the number of trips and increase the lengths of stay.

[NW-Bound]

Apparently, there are solid reasons for the precise "9.5" number. Does it have to do with pensions, early SS, etc...? Why 9.5 and not 1.5?

[freebird5825]

Quote:

Originally Posted by NW-Bound Apparently, there are solid reasons for the precise "9.5" number. Does it have to do with pensions, early SS, etc...? Why 9.5 and not 1.5?

dh2b just passed his 10 yr mark as a fed in April 09. He will w*rk for a full 20 years until age 58 to get a halfway decent FERS retirement. He also did 20 years military, as enlisted.
He still pays out divorce/child support related monies, so his ability to save a lot is greatly hindered right now. Such is life.

Unless of course we win the NY Lottery......then we can buy that vacation home. Lakefront property in the Finger Lakes.

[FIREdreamer]

DW and I are thinking about buying a small condo in Europe. My family lives there and we visit several times a year. Right now we crash in my mom's guest room every time we go visit but it is a bit cramped. We would like more room, more freedom and feel more "at home". We would like to keep some of our stuff there permanently, such as our heavy winter clothes and European appliances, which we do not need here in the south (it would allow us to travel even lighter). My parents could look after the condo when we are not there and I already have some furniture (stored in my dad's garage) that I could use to furnish the place.

What's stopping us right now are the upkeep costs (condo fees, taxes, utilities, insurance, etc...). We could easily afford them, but mom's guest room is hard to beat cost wise. So, for now, we'd rather build our portfolio. But we might reconsider in a few years...

[kat]

I use my second home in the mountains more than I use my first home in a city 85 miles away. My use is about 67% country, 33% city.

If I sell one, I will sell the city home and rent for a few months a year. But every time I sit down and think through selling the city home, I decide not to. Recently I put it on the 18 month plan, i.e. get it in shape to sell in the spring 2011 if I decide to, the same spring I intend to stop my attorney registration and officially retire (already really retired).

Truth is I like both places, in NE New York and Mid Vermont. The smartest thing I did was buy where I can go on a whim. I feel so free!