Vacation property purchases are complex investments. The typical purchaser is challenged by the prospect of purchasing real estate in markets where they are not familiar. Historical value patterns and current trends are often derived from emotional meters rather than from solid investment principles. Purchasers frequently select a condo in the area where they have traveled or vacationed and evaluate the purchase by their limited exposure to the area.
The first step to purchasing a beach condo is to determine how it will be used. Do you plan to vacation in the unit for a week or two each year, or will you migrate for most of the winter? If it will be a frequently-used second home you should make more than one visit to the area to be certain that it will suit your long-term goal. If the unit is primarily intended to be a rental, you must evaluate the purchase in a less personal fashion.
Investment purchases are best made with the assistance of an investment advisor who specializes in investment real estate. Establish a relationship with a buyer’s agent who works the vacation market in the areas of interest. Request price patterns for each condo site and compare variations. Pay special attention to any irregular spikes or dips. Lastly, compare vacancy rates and apply those numbers to your debt service.
The beach condo market has surged in popularity as Baby Boomers continue to enter the second home market in record numbers. This buyer group is placing heavy emphasis upon “lifestyle” properties. These are properties that offer beach, golf community or other lifestyle amenities. The Boomer interest helps to support value and demand, making a beach condo purchase a wise investment.