With South Africa’s endless shoreline beauty, mountainous gems, paradise towns and other attractive world-class holiday locations, it is no wonder that there is great demand for homes in these areas to act as holiday getaways.
Richard Gray, Harcourts Africa Chief Executive Officer, says these properties are very popular and, when the right path is followed, can prove to be fruitful investments and value-for-money holiday bases.
Gray gives his top tips for buying a holiday home:
1. What can you afford?
“First off, and most importantly, is deciding on affordability,” says Gray.
He says there are tax implications when owning a second home, and you also need to calculate thoroughly whether you can afford paying a second home loan and utilities, especially if you plan on letting the property.
If there is a time when you have no tenants, can you afford to cover the shortfall?
2. Location, location, location
Next, Gray says you have to choose the location.
“It seems simple enough to decide on the location of the holiday home you wish to buy, as you surely want to purchase where you prefer to go on holiday,” he says.
“However, does investing in this location actually make sound financial sense?”
When you start, identify a handful of locations you usually visit, and also identify areas you find by doing research on locations that show the most promise. Narrow these suburbs down to match your needs, and then do more homework.
“Contact agents in each of these areas and ask them what the average return on investment and growth percentage has been for properties in your price range,” says Gray.
“Also ask if there are any developments going up in the area, which will be a sign of interest by investors, and could present you with possible property opportunities that will be well looked after by a body corporate.”
3. Finding your holiday home
Once you’ve decided where you want to buy, Gray says distance comes in to play as you are often buying far from where you live.
“This is where property portals and the online space can be a great help,” he says.
“Ask the agent if they have virtual listings, which are video tours, of homes in the area for you to see. This way you can get a real good look at the different properties before spending the money to go and view.”
Assess demand in the area by browsing listings of similar value in the suburb online. Here you can gauge what the demand is, so when the time comes and you decide to let out the property in the months you’re not there, you know you will be able to find good tenants relatively easily.
4. Maintaining your holiday home
Gray says maintenance is always a major concern, largely because owners usually live far from their holiday property.
What is the point of buying a home you want to enjoy during your stress-free time or to act as an investment if it only depreciates and causes headaches because of a lack of maintenance?
“There are a few options here, and the best possible route is hiring a managing agent that will greatly reduce your hiccups by constantly keeping an eye on the property,” he says.
“Managing agents also ensure you are informed when problems arise, and they have electricians, plumbers, and so forth on call that can attend to any problems that occur while you’re away.”
5. Furnishing your holiday home
Lastly, Gray says furnishing a holiday home is often required, and this can prove tricky.
“Many holiday homeowners break the bank hoping to create a space that resembles home as well as an environment they feel comfortable in when they go on holiday,” he says.
“This is a personal choice and should also be considered carefully. A home standing open an entire year with many valuables can be a target for potential thieves. So be smart.”
All things considered, Gray says buying a holiday home is an exciting venture, and with the right agent assistance and research, can be a lucrative investment and a place where memories will be etched into the minds of those who spend their holidays there.
The information in this article is courtesy of www.property24.com